In a world that is becoming increasingly technologically filled with gadgets and gimmicks that seem to make people less connected to nature, significant efforts are being made to bridge the threatening gap between technology and the environment. As we all strive for a greener future, sustainability has become an ongoing topic of debate for business leaders and trendsetters across the world.
A Shift in Perspective
Nowadays, it appears that there is no limit to what people are capable of creating. And as we continue to explore the realm of possibilities, we become more mindful of our impact on our planet. As a result, there has been a rise in the demand for sustainable practices across all sectors of society, particularly in technology and science. "72% of consumers and small business clients are interested in environmental sustainability," according to Intive, a global technology hub, and "more than 69% would prefer their debit or credit cards to be made out of recycled materials." The statistics clearly show that a mindful and considerate approach to our environment is on the rise, and it is rapidly permeating all aspects of business practices.
The Future, Driven by Fintech
In the fight against climate change, financial technology has emerged as a key player in the development of green-powered solutions. Artificial intelligence (AI), machine learning (MI), and cloud technology, among other cutting-edge innovations, have allowed for cleaner and more efficient operational transactions aligned with Environmental, Social, and Corporate Governance (ESG) goals. Keep in mind that the United Nations has recently issued a worldwide call for all businesses and corporations to adopt cleaner technology strategies to help mitigate the effects of global warming. Fintech is leading us into a new era of sustainable finance, thanks to such system modernizations that drive sustainable financial practices.
Understanding Sustainable Finance
In the early 1990s, UN Environment and the international financial sector created an alliance to establish a global framework to address rapid environmental deterioration, thus the origin of the term "green finance." This alliance marked the beginning of sustainable financial practices. Sustainable finance is defined by the Harvard Extension School as "investment decisions that take into account the environmental, social, and governance (ESG) factors of an economic activity or project." Therefore, the goal of sustainable finance is to create a greener future by investing in businesses that are consistent with ESG principles in both practice and ethics. Many businesses are adopting this practice, if not for the greater good then at least to attract investors.
Fintech Leaders of Today
- Stripe Climate
Stripe's call to action is to reduce carbon emissions that are released into the atmosphere on a daily basis. Companies can use this dedicated service to invest a portion of their revenue in carbon removal technologies that are currently being researched and developed. This participation comes with a badge of honor that a company can proudly wear to demonstrate sustainable and environmentally friendly initiatives.
- Trine
Based in Sweden, this Fintech company encourages customers in making a positive environmental impact while also profiting. Their focus is on renewable energy like solar products, and with the help of private and public investors, Trine helps these green businesses move society toward a greener and more sustainable future. So, if you're an investor wondering where to best allocate your money, keep in mind that sustainable funds have long been shown to perform better than conventional funds in terms of returns, and Trine could be your next golden ticket.
Fintech has paved the way for many positive and conscious changes that can be made addressing climate change and a cleaner and more sustainable future, which can be made by anyone from an individual to a large corporation. It's important to get on the eco-friendly bandwagon sooner rather than later!