DUTCH-BASED sustainability bank Triodos, which invests in projects offering social and environmental value, is targeting Australia as its next big market.
Peter Blom, chairman and chief executive of the executive board of Triodos, and Bas Ruter, managing director of its funds management division, have been in Australia for the past week checking out banks as potential distribution and strategic alliance partners.
Triodos’ funds total 3 billion ($A4.8 billion) and its products include a European renewables fund, a large-cap equity fund, a bond fund and a thematic sustainability fund.
Its business banking division provides loans to charities, community groups, social businesses and environmental initiatives such as wind farms, and other businesses such as organic food and fair trade organisations. In its investment banking business, Triodos manages venture capital funds to invest in social and environmental enterprises across Europe.
Its investments exclude companies associated with tobacco, animal testing, alcohol, nuclear power, gambling, fur, arms and genetic modification. Its investment portfolio has few mining and oil companies but plenty in the renewable energy sector.
Its returns have been in line with the Morgan Stanley Capital International World Index, which Mr Ruter puts down to selective stock picking.
Mr Blom said sustainable investment, particularly in renewable energy, was now an enormous growth market, and he predicted it would become increasingly more mainstream.
"What IT was 10 years ago, is now sustainability," he said.
"People are turning to it now because they feel things have become really serious. It’s different from the past when they thought there would be a long-term solution. Now they hear the situation will create problems in 10 to 20 years so they know they have to do something now.
"And what we have been told here is that if people have access to a product with the risk-return profile in line with all the others, if this product can solve the water crisis and makes climate change less of an issue, then that is extra value that people as clients would value now."