Their 2007 survey confirms that Americans expect more from companies than ever before. Of those surveyed by Cone, 83% say that companies have a responsibility to help support causes.

Of course, the question asked of the affluent addresses intent, not action. Saying that you consider the green business practices of companies does not mean that you necessarily let those practice guide your actual investments. Talking green and appearing environmentally conscious is very popular now. Indeed in mid-March Northern Trust launched a new socially aware index fund in response to interest from the market in putting money in environmentally friendly areas.

While it is likely that more wealthy investors are looking at the environmental track records than ever before, it is also likely that a certain amount of lip service is being paid to ideas like green investing and small “carbon” footprints.

Industries like mining, those involved in nuclear power, major chemical firms, or processors of steel or aluminum can be very lucrative investments and may never be considered green or environmentally responsible companies because of the nature of what they do. But even they can be encouraged to investigate cleaner ways to do business if their investors apply pressure.

Green investors are still taking part in the lucrative energy industry, without investing in traditional power companies, by selecting among the myriad of clean energy companies engaged in solar and wind power, fuel cells, and the next generation of biofuels.

There are also various levels of sustainable business practice that investors have to consider. The first level would be cursory; a retailer like Target carrying more organic products. A second level would be any kind of factory reducing its carbon footprint. A third level might be a large company like Nike only interacting with suppliers or vendors who also followed sustainable business practices.

These are the levels of grey that wealthy investors must wrestle with when making investing choices. A real life example of this could be the ubiquitous Wal-Mart. While Wal-Mart is doing good things for the environment by buying more organic materials and foods and trying to reduce packaging, they also have an overall emphasis on consumerism that might not be compatible with the concept of Green. If a company like Wal-Mart, is consistently focused on all products being the cheapest, it creates an environment where suppliers could get pushed to cut sustainable practices. To be truly reflective of green practices, the whole mission of the company must be in line with green tenets.

Discuss this article on the forums. (0 posts)

---