How the **** can I ever make an impact? 🤔
Why understanding your investments' journey is the secret ingredient to a better world (and bank balance) 💸
The "value chain": An essential summary of an (intentionally) complex monetary roller-coaster 🎢
You know that feeling, right? The one you get when seeing that modest green number becomes slightly wild and sheds a few digits? Maybe it even heads off to the red light district, occasionally? 🔻
As painful as watching that bank balance decrease for a bunch of important subscriptions (and some less important things like groceries), that is only the beginning of the journey that your money takes - and a prequel to the impact it creates. ⛓️
Some folks may have heard mentions of supply chains before. Basically, supply chains are the start-to-end sequence of things that people or businesses must do - usually with the help of other people or businesses - to deliver that pepperoni pizza with extra cheddar to your doorstep🍕:
1.From the farmers who source equipment and raw goods to cultivate and eventually sell ingredients or materials ↩️
2.to the wholesalers who buy these to supply the restaurants ↩️
3.that use Uber Eats drivers (who are also considered 'suppliers' of human labour) and finally into your hungry belly ✅
Phew! Okay, that is a lot to consider when you're really only clicking a few pixels on a screen before lunch. But the truth is, while each of the supply chain's activities have critical contributions to your pizza, and costs that scale with how important and difficult they are to do, what really matters most are:
1. The VALUE that each activity brings or creates for YOU- the pizza eater - and as a result,
2. The VALUE companies are rewarded with by YOU- for helping to make and send your pizza
And thus, ladies, gentlemen and other beautiful people of the world, we have a value chain! The way that your favourite brands organise their processes to create mutually-beneficial value for themselves and their customers. Of course, the benefit you the feel that you earn from being delivered a lukewarm pizza is up to you to decide. But our general way of working is that we tend to pay- and pay more - for things that we feel benefit us the most.
Since the average Aussie's estimated average monthly spending on food and drink takeaways on Deliveroo and Uber Eats individually were 51 and 44 dollars respectively in 2021, you can see the huge amount of financial value and assume the huge amount of personal benefit that Aussies receive. Because of this, the monetary value and customers' personal benefit (often called a customer's "utility", referring to the perceived value from using products or services) is ascribed differently to each activity ('link') in the value chain.
Okay, cool, thanks for the lesson... But why should I care about value chains when I'm only here to make moolah responsibly??
The one-liner to bind them all is: Your money decisions tell companies what you think the ultimate value of every chain link, final product and service ever made from now to eternity. Companies want YOUR money, and it's up to you to decide when and to whom you give it.
The best part? Companies will literally CHANGE their minds and actions to get it from you! Now, isn't that just dandy for someone like you - a special youth who wants the world to be a better place (and make big bucks doing it)! 😉
Value today ≠ value tomorrow. Critical ≠ irreplaceable.
Your investing habits can force companies to make changes and act in-line with your personal values. By rewarding and funding the companies and value chain partners that are either transitioning towards or already operating ethically and sustainability, the financial incentive for joining the trend grows. Eventually, things that companies once told us were "necessary evils" or irreplaceable suddenly become relics of the past when both customer and regulator pressures increase.
Although in today's world coal power is generally critical and valuable for companies to create wealth from providing your benefits, they will replace it with greener alternatives IF their customers and investors vote with their wallets. For example, innovation and transition is on the rise concerning net-zero shipping activities thanks to driving the use of green hydrogen.
They would not have had any interest in doing this without incentive because when they are already making bank, it's safer to take a path of least resistance if that path is more profitable.
Your impact investing decisions shape the future by speaking the language that capitalism prioritises above all - financial flows. It overrides ethical and moral debates for why aim for sustainable development goals set by the United Nations and instead cuts to the chase - do it or else.
Invest with a positive impact at Inaam 🚀
We are building an app with embedded investment literacy and a true learn by doing approach. An app the shows you how to invest your money, tells you exactly where your money is being invested and exactly what impact it is going to have.
Here's our next stock pick 💡
Canadian Solar founded back in 2001 is rapidly revolutionising the clean energy transition by providing modules, inverters, system kits and storage solutions across the globe! Their latest market cap values them at over $2.1 billion and in the last 5 years they have earned investors over 170% in returns!
In terms of impact here's how they stack up.
- Over 67 GW of modules shipped 🛳 (thats almost a billion LEDs).
- 24 GW pipeline 🔋
- Active customers in over 160 countries 📍
- 20 manufacturing facilities across the world 🌍
- 14,000 employees globally of which 35% are women (22% in management positions) 💁♀️
The good companies exist the world over - we just need to find them and bring them to the forefront of retail investment and thats exactly what you can do with Inaam! 📲
We hope you enjoyed this week's edition of Opening Bell! See you soon! 👋
