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Consider investing in projects that generate positive environmental and social impact beyond profitsOver the decades, Singapore has made a name for itself as the leading financial hub in Asia.存倉But while it blazes a trail ahead of rivals in many financial offerings, I find it severely lacking in one aspect - impact investments.Impact investing, broadly also known as ethical or socially responsible investing, refers to investment in projects that generate positive social and environmental impact beyond financial returns.Global awareness of such investments has gained momentum in recent years.A study by the Monitor Institute has projected that the global impact investing market could grow to US$500 billion (S$620 billion) by 2018 - accounting for 1 per cent of global assets.According to a report on the global impact investing industry by the Rockefeller Foundation last year, a few factors have contributed to this.Investors are considering broader definitions of risks in investment decisions, triggered by the 2008 global financial crisis. There is a growing recognition that existing resources are insufficient to address severe poverty, inequality and other complex issues.There are emerging projects demonstrating that it is possible to finance scalable business models that create social and environmental value, such as say, a renewable energy project in rural Asia that provides reliable, affordable energy to a community that would otherwise rely on burning diesel or coal that not only adds to pollution, but also has negative health effects.The report also noted that there has been a transfer of wealth in developed countries to a generation of wealthy individuals seeking to embed their values in where they choose to put their money.In other words, young and savvy investors today are more likely to want to put their money into worthwhile investments that do good beyond just generating profit.And why not?Just a generation ago, investors couldn't care less what type of equities they bought as long as it generated a healthy return.My parents typify this generation of investors. They have no qualms investing in equities known as "sin stocks" that make their money from vices such as gambling, alcohol and tobacco.In contrast, I am finding that more of my peers - the enlightened ones - think carefully about where they put their money.During the severe haze outbreak in June, I casually mentioned to my older relatives at a family gathering that maybe they should reconsider buying the stocks of several listed palm oil companies - given that some of them were allegedly linked to the acute deforestation in Indonesia.Their reply? "But these stocks have healthy fluctuations - easy to make money!"I suppose it's difficult to argue against an investing philosophy that prioritises healthy returns. But I do believe that given a choice, most rational investors would like to know that the companies they are supporting are generating some social good that addresses some of our global problems while doing business - instead of adding to the world's woes.Investing in such equities does not necessarily require financial sacrifice.A 2010 report by JP Morgan and the Rockefeller Foundat儲存on forecast that a small subset of the sector addressing housing, water supply, health, education and financial services has the potential of generating total returns of between US$183 billion and US$667 billion over the next 10 years.The problem is, even if the spirit is willing, there is a lack of access and dearth of investment options here for retail investors today.There are a few, such as the HSBC Global Investment Funds' Climate Change Fund, launched in 2007, which invests at least two-thirds of its total non-cash assets into firms developing activities related to climate change such as alternative energies, water, waste and pollution, energy efficiency and low carbon players.Its year-to-date return as of end-September net of sales charge is 15.8 per cent. It is available to investors in Singapore at a minimum investment of $1,000.A survey of our financial landscape throws up little else. Singapore's three local banks have shown little leadership in this area.Wouldn't it be great if the Singapore Exchange (SGX) provided a platform for such socially responsible firms to be listed in Singapore, and all it took was for us to log into our trading accounts and buy these equities?A Singapore-based company, Impact Investment Exchange Asia (IIX Asia), had precisely this idea. Its Impact Exchange is the world's first public trading platform dedicated to social enterprises.Its managing director Robert Kraybill said that due to a variety of factors, including the ability to serve both Asian and African social enterprises, the company decided to locate the exchange in Mauritius in partnership with the Stock Exchange of Mauritius.All issuers must demonstrate positive social and environmental impact to be listed. IIX Asia expects to have the first listings trading by the middle of next year, making the equities accessible to all investors, including retail ones.It is my hope that in the years to come, retail investors here will find it easier to invest in these equities. For now, the alternative is to select listed companies on the SGX based on their corporate responsibility and sustainability practices.The SGX, lagging behind other exchanges in countries such as Malaysia, South Africa and France, does not require listed companies to file sustainability reports - so investors with these goals have to do more homework. This involves reading through annual reports and assessing a company's impact and business operations based on our own research and deciding if this is a company we'd like to support.There are some companies that I invest in that have demonstrated leadership in this area - real estate plays such as City Developments and CapitaLand. They have taken significant steps to improve the energy efficiency of their buildings, reduce their companies' carbon footprint and adopt other responsible business practices like looking at supply-chain issues.Another is Hyflux, whose water-treatment business does have a positive impact on communities.The way I see it, investors can make a powerful impact - and return - by choosing carefully where they place their investment dollars. It seems obvious to me which ones are more deserving than others.stinvest@sph.com.sg迷你倉