Private sector investments since 2007 in green companies and technologies globally now total $2,405,182,005,199 worldwide, according to the Aug 2011 update of the GREEN TRANSITION SCOREBOARD® released by Ethical Markets Media.
The GTS anticipates investments and commitments of $1 trillion annually until 2020, a figure many studies indicate will accelerate the global Green Transition. This amount is significant because many studies, computer models and reports indicate that investing $1 trillion annually until 2020 can ramp up material and energy efficiencies, reduce costs of wind, solar, geothermal and other renewable energy, increase sustainable land-use and forestry, and support smart infrastructure, transport, building and urban re-design, accelerating the Green Transition worldwide. The updated 2010 finding of over $2 trillion puts global investors and countries on track to reach $10 trillion in investments by 2020.
To ensure meeting the target, investment funds need to shift away from more speculative sectors such as hedge funds and dark pools and away from investing in fossilized sectors to investing at least 10% of their portfolios directly in companies driving the global Green Transition. With the data in the GTS, security analysts can update their strategic asset allocation (SAA) models to highlight green markets, as now recognized in the report by Mercer that “standard approaches to SAA rely heavily on historical quantitative analysis … historic precedent is not an effective indicator of future performance.”
Indeed, in a time of global transition, companies need to follow sound investment strategies, relying on proven strategies instead of historical precedent, to take advantage of new opportunities.