What is Sustainable Finance?
Community Investing
Sustainable finance refers to financial activities that consider environmental, social, and governance (ESG) criteria, aiming to promote sustainable development. Within this broad category, community investing is a key component.
Community investing involves directing capital to underserved communities with the objective of generating positive social impact alongside financial returns. This form of investment supports local businesses, affordable housing, and essential services that contribute to community well-being.
Impact Investing
Impact investing overlaps with community investing, focusing on creating measurable social and environmental benefits while achieving a financial return. Investors in this space deliberately allocate resources to enterprises that address specific social challenges, such as poverty alleviation or climate change.
Both community and impact investing aim to mobilize capital towards sustainable projects, enhancing quality of life in communities while fostering economic resilience. These practices not only yield financial returns but also strengthen community bonds, empower local economies, and promote sustainable development.
In essence, sustainable finance, particularly through community and impact investing, is about building a future where financial viability goes hand-in-hand with societal progress.