Invest in Our Planet: Reshaping Business and Investing for Global Positive Impact
SCG Chemicals Public Company Limited, one of our Corporate Members, provide us the article on Invest in Our Planet: Reshaping Business and Investing for Global Positive Impact.
Our world is getting warmer every day, and people are beginning to realise it’s time to change toward a more environmentally conscious lifestyle. At the same time, consumers expect businesses to operate on a sustainable basis without causing long-term damage to the environment.
“Invest in Our Planet” is the central theme of the environmental campaign for Earth Day (held annually on 22 April), which has been running consecutively for two years. The objective is to encourage all sectors, including government, businesses, and the general public, to work together and invest in making positive changes for the world.
From a consumer’s perspective, changing the world may start with simple actions, such as adjusting one’s behaviour. However, on a larger scale at the national or business level, transforming organisations into fully eco-friendly ones requires increased investment and financial liquidity support.
“SCGC is committed to conducting business along the path of sustainability. In the past, SCGC has invested in improving its operations to align with ESG principles, considering environmental factors, social responsibility, and good corporate governance. Furthermore, SCGC continuously innovates and develops chemical products for sustainability, such as SCGC GREEN POLYMERTM eco-friendly plastic resins, floating solar farms that support the use of alternative energy, or lightweight plastics for automotive components that help reduce energy consumption during driving. Importantly, SCGC is determined to achieve carbon neutrality by 2050.”
The investment world shifted focus to sustainability.
Regarding investments, it is evident that the financial sector is becoming more aware and directing its focus toward investments that positively impact society and the environment, also known as Impact Investing. This includes investments in stocks, mutual funds, or bonds that contribute to a better world while generating continuous profits.
Today, ESG criteria serve as indicators of which businesses prioritise creating positive global impacts. These criteria consist of Environmental, Social, and Governance factors. Several sustainability indices are available on the market, including the SETTHSI (Thailand Sustainability Investment) by the Stock Exchange of Thailand, the Morningstar Global Markets Sustainability Index by Morningstar, a leading provider of investment data and analytics, and the Dow Jones Sustainability Indices (DJSI) selected by RobecoSAM and S&P DowJones, which are internationally recognised indices. These indices incorporate ESG criteria along with considerations of historical returns, giving investors confidence in selecting stocks or funds that deliver long-term benefits.
A global push to support environmentally responsible businesses.
Turning to the business sector, transforming organisations to adapt to sustainability challenges requires a long-term vision and foresight for future changes. For example, offering products that address the need for alternative energy sources will become a crucial solution for preserving the environment in the future. Additionally, organisations must prepare funds to invest in business transformation or production processes, leading to the emergence of Green Finance as a means of raising capital and enhancing liquidity for environmentally-friendly businesses.
When it comes to green finance, several financial instruments are used to raise capital for businesses and meet the needs of investors seeking returns from companies that operate based on ESG principles. These include Green Equity Funds, which are mutual funds that focus on investing in sustainable businesses; Green Loans, or credit lines used for improving businesses to be more environmentally friendly; and Green Bonds, which are debt securities or bonds issued to borrow money from investors. Among these, Green Bonds are the most popular method.
- Green Bond is aimed at raising capital to invest in or repay existing debts related to environmental projects.
- Social Bond is issued to develop society and improve the quality of life for people, such as public health services, education, or other social initiatives.
- Sustainability Bond is a combination of Green and Social Bonds, aiming to raise capital that will benefit both the environment and society simultaneously.
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