Green finance creating a ‘virtuous’ sustainable circle

MAKING a profit and doing the right thing is helping to create a ‘virtuous’ sustainable finance circle, according to private equity guru and investor Jon Moulton.

Mr Moulton, who lives in Guernsey, said people were interested in making money and doing some good.

At the same time, government net-zero carbon targets had accelerated developments in the sustainable finance sphere.

‘At the moment it’s growing very quickly.

‘It has become very fashionable, politically correct and rewarding to invest in sustainable and green activities.

‘Because people are investing in green, green assets are going up in price – so you get an increased performance,’ said Mr Moulton during an event at Guernsey Finance-hosted Sustainable Finance Week.

‘So you’re got a virtuous circle driven by good old fashioned profit as much as anything else.’

He continued that for most family offices, profits remained the main game.

‘If they can do it and do some good at the same time they like that.

‘Some family offices are more genuinely green and sustainable first and profits second. But they are very much a minority.’

Mr Moulton, who said he had been involved in green investing, added that new activities were springing up in response to government climate initiatives. Areas he has been involved in include alternative energy, forestry and reusing materials.

Using forests as a way of taking carbon dioxide out of the atmosphere had become ‘very hot’, he added. People were buying land such as forests, setting up tree nurseries and finding species that held more CO2 and lasted longer.

The cost-effectiveness of alternative energy had also become within reach as an affordable option. But it was a ‘complex game’ given that the sun did not always shine or the wind did not always blow.

Sustainable Finance Week. (29636901)

Mr Moulton said alternative energy had to be mixed with other forms of energy. It was also easy to end up in the part of the supply chain where there was too much capacity, at which point a return would not be made.

‘It’s not easy green investing at all.

‘Picking out what’s truly green as opposed to what’s painted green is sometimes difficult.’

He also said he had been investing through Guernsey vehicles since 1985 and that it had worked pretty well, with the rules and regulation tending to be sensible.

Things had been allowed to develop when they needed too.

‘It’s a good place to invest in,’ said Mr Moulton.

. Sustainable Finance Week has seen the restart of physical events for Guernsey Finance, the industry promotional agency. This week has seen an audience watching events live locally and online, blending on-stage speakers with guests from across the globe. Fringe events have also been taking place.

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