In the 1980s, greed may have been seen as good but many investors have long since recognised the need to act responsibly alongside making a buck. The problem is that chasing the good has not necessarily offered investors the chance to satisfy their greed.
On the face of it, companies at the forefront of renewables should be a safe bet as one means of combating the global build-up of greenhouse gases. Given the intractable nature of global warming, one would expect this is a long-term growth story. After all, China, the world’s largest greenhouse emitter, the US and the EU have all spent heavily to build up green energy credentials. But still relatively few investment winners have emerged.
Sure, there have been a few companies that have done well, such as Vestas, the Danish maker of wind turbines. Its shares have more than doubled over the past three years. Big growth in wind generation in the US and Europe has helped. And it has only begun to crack the world’s largest wind market, China. But then look at the shares of its Chinese rival, Hong Kong-listed Xinjiang Goldwind, the world’s largest turbine maker. They have hardly budged over that time. Wind turbine users have fared little better: China’s largest wind power producer China Longyuan Power has also been a poor investment.