Today the United Nations estimated that the world's human population has reached seven billion people. It has become a number so large that it is difficult to grasp--like the size of the national debt. More alarming is the trend in population growth and the resulting demands on the earth's life-supporting capacity. The world's population has doubled in just the last fifty years. Think about that for a moment. The increase has been one billion in just the last twelve years.
These developments have enormous implications for the ability to meet human needs in the decades ahead. It's not just for aesthetic or compassionate reasons that the quality of the air, water, and natural environment in general needs to be protected. With already nearly one third of the world's people lacking clean water, future demands on water and food supplies will cause even greater strains.
We, as global citizens, have the responsibility to foster sustainability in our personal behaviors and in electing government officials. Likewise, corporations have a responsibility to do their part as well. Top business leaders should recognize--and many already have--that by anticipating and acting on the challenges from population and resource strains (and climate change) that their comparative business prospects will improve and be sustained for years to come.
We as investors can foster this as we allocate our capital toward the most sustainable businesses. Research shows that incorporating environmental, social, and governing (ESG) factors into traditional financial statement analysis yields superior investment returns (as well as spillover benefits to the world overall).