Ethical Markets Media has released its 2012 Green Transition Scoreboard, the newest report based on their global scoring system used to track private sector investments in green companies and technologies since 2007.
At the close of last year, the green global investment total stood at $3.3 trillion, according to their results starting from 2007.
The 2012 report found Asia, Europe and Latin America catching up with the U.S. in terms of total non-government investments and commitments for all facets of green markets.
Studies have indicated that investing at least $1 trillion annually until 2020 will accelerate the transition to green technologies worldwide, and based on Ethical Markets’ findings in their 2012 Green Transition Scoreboard, green investments are on track to reach the $10 trillion goal by 2020.
The group suggests that institutional investors are shifting away from more speculative investments such as hedge funds, private equity, oil and commodities—and appear to be redeploying at least 10% of their portfolios directly in companies driving the Green Transition.
Ethical Markets believes that their recent data will provides investment advisors the foundation to update their asset allocations to include green sectors, in an effort to both offset climate risk and capitalize on these opportunities.
Global consultancy group Mercer has also recommended investors include green sectors in 40% of their portfolio.
“The current transition from fossil fuels to greater efficiency and renewable energy and resources is simply the next stage in knowledge and scientific progress,” says Hazel Henderson, president of Ethical Markets Media. “Institutional investors have made the leap to opportunities in the global retooling for the inevitable green transition, estimated to be a $45 trillion new global market.”
Timothy Nash, senior advisor to Ethical Markets Media, believes that an example of the paradigm shift is the burst of activity in the M&A space due to companies spending cash that was hoarded since the credit crunch, with more capital being spent on expansion in to the green space and developing R&D.
Fritjof Capra, physicist and author of The Hidden Connections, adds that, “[The Green Transition Scoreboard] is an important initiative that tracks a quiet revolution: the Green transition to technologies that are small-scale, community-oriented, non-polluting, energy-efficient, labor-intensive, [and that] create plenty of jobs.”
But, there are many smaller companies, local enterprise and initiatives not yet being recognized within the report.
“As impressive as $3.3 trillion is, there are many green market investments omitted from the GTS,” says Rosalinda Sanquiche, executive director of Ethical Markets Media, “Thousands of investments ranging from $100,000 to several million offer significant opportunities to move the green economy forward at the local and regional levels, transforming Main Street beyond Wall Street’s attention.”