If you've ever felt like your investment money is stuck doing the same old thing, chasing profits without a purpose, you're not alone.

Welcome to the world of Sustainable investing. It’s where your money earns a return and works to build a better world. Within this movement, there are three key approaches often mentioned: ESG, SRI, and the most powerful of all, Impact Investing.

Let’s break this down.

What are ESG, SRI and Impact Investing?

ESG, SRI, and Impact Investing are all ways to align your investments with your values.

They shift the central question from just "How much money will I make?" to "What kind of world am I helping to build?"

These are frameworks that help investors make decisions aligned with their values, global sustainability, and long-term impact, without ignoring financial performance.

ESG - The filter

ESG stands for Environmental, Social and Governance. ESG Investing evaluates companies based on three core factors:

Environmental: How a company manages its impact on the planet like emissions, waste, renewable energy use, and resource efficiency.

Social: How it treats its employees, suppliers, customers, and communities.

Governance: How it operates through leadership ethics, transparency, board diversity and fair executive pay.

It is like a filtered feed on YouTube. ESG filters out the bad content (polluters, unethical firms) from your video feed, so you get clean recommendations that you might like.

ESG is primarily focused on managing risk.

Moneysmart AU explores more deeply how ESG can help investors to make value-focused decisions and what to look for.

SRI- The curator

Socially Responsible Investing (SRI) takes ethical considerations one step further. It focuses on excluding industries or companies that conflict with moral or social values.

SRI investors apply what’s called negative screening, which is intentionally avoiding “sin” sectors such as:

Tobacco
Weapons
Fossil fuels
Gambling
Adult entertainment

In contrast, positive screening highlights companies making meaningful progress in areas like renewable energy, fair labour, and diversity.

Think of it like a curated Youtube playlist. SRI helps you curate your content playlist that fits your purpose and values and ensures no awkward "why is this in my recommendations?" moments.

SRI is focused on aligning with values.

For a deeper understanding of SRI and its inclusions click here.

Impact Investing- The inspirer

This is where it gets exciting. Impact Investing refers to investments made with the intention of generating measurable, positive social or environmental outcomes, alongside financial returns.

While ESG manages risk and SRI avoids harm, Impact Investing actively creates solutions. Impact investments target crucial sectors where capital can drive demonstrable change, such as:

Clean energy: Funding new solar, wind, and geothermal power projects.
Affordable housing: Investing in developments that address housing shortages in underserved communities.

Education technology: Backing tools that make quality learning accessible worldwide.

Think of it like a feel-good podcast. This content moves you and leaves you inspired, not drained. You feel good when you invest your time (or your money!) into it and get a great experience out of it.

Imagine going from “I recycle” to “I fund the recycling company.” That’s Impact Investing, where purpose meets profit in motion.

To explore more about impact investing in our blog, click here.

Impact investing is the way forward

The future of finance is about action. Investors, particularly those from the younger generations, are no longer content with simply avoiding bad investment. They want their money to actively solve global challenges.

The focus on clear, measurable outcomes is what gives Impact Investing its edge and why it represents the future of responsible wealth building.

Morgan Stanley research details an overwhelming interest in sustainable investing from individual investors, especially Gen Z and Millennials.

How to select what works?

Like any other investment approach, these strategies help you choose which companies or funds your money supports, but the selection criteria go beyond profits.

When you invest through funds or platforms that offer these approaches, you can often choose between ready-made portfolios (curated by fund managers) or build your own by picking companies that match your beliefs.

Click here to see how you can get started with impact investing.

Benefits of impact focused investing

When you focus on genuine Impact Investing, you gain unique advantages that go beyond traditional portfolio management.

Aligning wealth with a deeper purpose

This is your Emotional ROI (Return on Intention). You're not just growing your money, you’re growing your influence. For many modern investors, the confidence of knowing their capital is solving problems they care about, is just as valuable as the financial return.

Have a quick read on how Australians are starting to demand more from their money.

Access to future-proof markets

By directing your investments toward innovative solutions in areas generating positive impact like clean water and air, you gain exposure to markets that are set up for significant, long-term growth. As global sustainability becomes a necessity, companies solving these problems are naturally more resilient and future-proof.

Review how this report from Oxford research discusses how impact itself can act as a driver of excess returns under specific market conditions.

How to evaluate the risks?

In Impact Investing, assessing risks means looking beyond standard financials. It means asking: “Is this company’s impact claim genuine?”

You should always look for a clear connection between the investment and the outcome. Always check the data, not just the buzzwords, to ensure a company’s impact claims are backed by measurable performance, a concept that is now becoming easier than ever.

Betterevaluation does a great job at highlighting the risks associated and how to screen companies to check their impact.

How inaam makes impact investing simple

Building an investment portfolio that actively creates measurable impact shouldn't feel like navigating a complex maze. At inaam, we are dedicated to making Impact Investing intuitive, accessible, and transparent, so you can stop wondering and start acting.

We make Impact Investing easy by simplifying the entire process through guided, impact-focused features.

Select your impact themes: Start by choosing the causes that matter most to you. From tackling climate change to promoting health and well-being, inaam helps you identify the specific outcomes you want your money to support.

Define your action: Using our guided tools, you decide where you want to make a difference. These selections inform inaam exactly where to direct your money for measurable change.

Get curated portfolios: inaam curates diversified investment "buckets" tailored to meet your financial goals and your specific impact outcomes. We simplify the complexity, matching your desire for change with high-quality, impact-focused funds.

Create an investment portfolio without the endless “what now?” moments and finally feel

confident that you’re doing it right.

A note for the future ‘you’

Impact investing is changing what it means to grow your money. It proves that strong financial returns and positive change can go hand in hand. Instead of chasing short-term gains, it’s about using your capital to support the world you want to live in.

At inaam, we are making that journey simple and clear. Our platform helps you see exactly where your money goes and the difference it makes, dollar for dollar.

Ready to start investing for good? Take our Money Values Quiz to see how inaam can help you take that first step.

The Three Pillars of Sustainable Investing