Looking to make the world a better place while growing your money?
According to a recent report from the Responsible Investment Association, more than $4 billion has been allocated in Canada to “investments made into companies, organizations, and funds with the intention to generate a measurable, beneficial social and environmental impact alongside a financial return”. This definition speaks to the notion of a ‘blended’ return whereby investors are rewarded with both a financial return AND a social / environmental impact. It’s a clear win-win-win for the economy, society, and the planet.
Community bonds can enhance any portfolio by offering a strong return on investment, while hedging against systemic risks that could affect the entire stock and/or bond market. Since community bonds aren’t traded on any exchange, they will remain stable in the event of a crash. Community bonds do come with some unique risks, and investors need to do their homework before investing.
So how can everyday investors like you and me get in on this action? Thankfully, three leading organizations have teamed up to present a quick factsheet that outlines their community bonds:
I love the content of this factsheet, and what excites me the most is the collaboration it represents. All too often in the investment industry, I’ve seen organizations competing against each other for your (or my) money. It’s refreshing to see that these nonprofits, instead of competing for a bigger piece of the pie, are collaborating to make the whole pie bigger! This speaks volumes about the culture in the social finance sector, and provides a stark contrast to the cut-throat nature of the old investment banks.
My hope is that investors will stop asking ‘should I or shouldn’t I?’ around community bonds and start asking ‘what percentage of my portfolio should I invest?’. If Canadians allocated just 5% of their money into community bonds, it would activate more than $50 billion of capital to help the nonprofit sector grow and thrive. Now that’s a sustainable economy!
Want to learn more? Get your tickets to the Community Bond Showcase happening March 19 6-9pm at CSI Annex (720 Bathurst, just south of Bloor).
**DISCLOSURE – The author is a member of both SolarShare and CSI and is about to join ZooShare**
This post was written by Timothy Nash and was originally posted on The Sustainable Economist blog. It was re-posted here with permission.