Friday, January 8, 2021

Social Investing (ESG) for Profits in Emerging Environment Technology

Investing is the blood that keeps financial markets rising and fuels nation with needed financial capital. Without access to resources we chock our prospects and smother our options. There are winners and losers in the market where large fortunes are made and hopes dashed on peaks and valleys of stocks. While we may not instinctively want to throw ourselves into the rapids of profit seeking thrills we must consider investing in industries that have value beyond the dividends of dividends. Changes in climate legislation and increased international coordination on carbon emissions are likely over the next decade as the values of the young grow up and invest on the market. 

Investing for Environmental, Social and Governance (ESG) seeks to put money where our values lay. Dr. Max Schanzenbach a professor  of Law at Northwestern University is an expert on empirical analysis of public institutions and Dr. Robert Sitkof  a Professor of Law at Harvard specializing in probate, investment and trust law have done some research on this topic and believe ESG can be sustainable under the right conditions "The original motives for ESG investing were moral or ethical, based on third party effects rather than investment returns." (Schanzenbach, & Sitkoff, 2020, pg 2).

 ESG can invested in for profit via (1) active investing; or (2) active shareholding. 

1. Active Investing: Must search out and find mispriced/underpriced stocks in order to continue to earn money in ESG investing. 

2. Active Shareholding: Trustees and other investment managers for entities like pensions, charities, trusts, etc. and often amount to trillions of dollars. 

Some individuals will actively seek out investments that have helpful benefits to society (i.e. carbon emissions). Billionaires and crowd-capital type investments could have a large impact on these types of companies. Institutional investors are likely to be the best bet (i.e. pension funds...) because they can hedge profits with good works investments. 

One company I looked at and bought a small amount of shares (disclosure) in was KNRLF. It doesn't necessarily matter that it is this company, but that it is in line with two different trends 1. climate control and 2. innovating technologies. When investing I look for different ways to understand larger trends by individual stocks I can follow that can help understand how economic elements and trends interact.

You can read the description of their flagship product and how it could be used once its fully developed for multi-purpose use. KNRLFKONTROL ENERGY CORP COM

BioCloud is a real-time analyzer designed to detect airborne viruses. It has been designed to operate as a safe space technology by sampling the air quality over time. With a proprietary detection chamber that can be replaced as needed, viruses are detected, and an alert system is created in the Cloud or over local intranet. BioCloud has been designed for spaces where individuals gather including classrooms, offices, retirement homes, hospitals, mass transportation and others. Additional information about Kontrol BioCloud can be found on its website at www.kontrolbiocloud.com

Notice that the company has grown significantly over the past 6 months while prior to that not much was going on. Its interesting 👀

I don't want anyone to assume that I'm giving advice. I'm not. What I am highlighting is that there are emerging technologies that can have an impact on our climate (and other social issues). In order for these companies to grow and innovate they need additional investment designed to solve common problems. We can solve problems through legislation but it would be more prudent to develop industries capable of solving problems. This is a Canadian company but certainly you could search out American companies.  I would like to search out public traded companies exist in Delta County MI and related private industries and their core competencies to see where the best growth paths are likely. See if we can find a path and sprinkle it with investment "magic" to explore the concept of pack investing (multiple investments in industries that can cluster) to spark innovative clusters that can lead to perpetual sustainable growth. With the strengths of the area they may be able to attract investments, manufacture (and/or assemble), and distribute from local resources that leads job growth and economic development.

Schanzenbach, M. M., & Sitkoff, R. H. (2020). ESG Investing: Theory, Evidence, and Fiduciary Principles. Journal of Financial Planning, 36(10), 42–50.

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