Sustainability key to economic survival

by Sarah Rich, The Australian, 22 April 2009.

(Reported by Xander Wheen)

The value of sustainable business practices has been thrown into question on the back of the Global Financial Crisis. Some believe that a down market begets a singular focus on profit maximisation. This article from The Australian traces a series of high profile individuals who tend to disagree. Sustainability in business remains key to Tyndall’s Roger Collison, Insurance Australia Group’s Mike Wilkins, and Generation Investment Management’s David Blood. Both Collison and Wilkins emphasise the importance of sustainability to economic survival. The growing emphasis on environmental and social issues as reflected in new governmental policy and legislation internationally, requires that a business is sustainable in terms of environmental, social and governance (ESG) goals. David Blood and his founding partner, Al Gore, see short-termism in financial institutions as a destabilising force that contributed to the current financial crisis.

On the investment side, Blood and Gore run an investment fund dedicated to sustainability. They are aware of the desirability of supporting sustainability in business for stability’s sake as well as the investment opportunities provided when market reorientation brings sustainability to the fore. So far their investment thesis shows promise; their fund was a top international equities performer last year. Blood believes sustainable development will be a key driver in investment returns for years to come. From the ashes of the international financial crisis, recovery is being led in part by some who want to start again and this time do it right.

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