Alexander Kopecek, boardmember of Wien 3420 Aspern Development AG
Socially responsible investing – Public Housing in Vienna
The Imperial-Royal Government had passed a Tenant Protection Act (Mieterschutzgesetz) in 1917 which had been declared applicable in Vienna immediately. Despite the high inflation, the act ordered the rents for flats to be frozen at the level of 1914. This made new private housing projects unprofitable. After the war, demand for affordable flats therefore grew extremely high. Creating public housing projects became the main concern of the Social Democrats in Vienna.
In 1919, the federal parliament passed the Housing Requirement Act (Wohnanforderungsgesetz) to enhance the efficiency of existing housing structures. Low private demand for building land and low building costs proved favourable for the city administration’s extensive public housing planning.
From 1925 (the year in which a strong Schilling currency replaced the devalued Krone) to 1934, more than 60,000 new flats were built in so-called Gemeindebau („community construction“) buildings. Large blocks were situated around green courts, for instance at Karl-Marx-Hof (one of the hot spots in the civil war of 1934) or at George Washington Court. The tenants of the new flats were chosen on the basis of a ranking system in which e.g. persons with handicaps got extra points to be chosen earlier. Forty percent of building costs were taken from the proceeds of the Vienna Housing Tax, the rest from the proceeds of the Vienna Luxury Tax and from federal funds. Using public money to cover building costs allowed the rents for these flats to be kept very low: for a worker’s household, rent took 4 percent of household income; in private buildings it had been 30 percent. If tenants became ill or unemployed, rent payments could be postponed.
Socially responsible investing, also known as sustainable, socially conscious, or ethical investing, describes an investment strategy which seeks to maximize both financial return and social good.
In general, socially responsible investors favor corporate practices that promote environmental stewardship, consumer protection, human rights, and diversity. The areas of concern recognized by the SRI industry can be summarized as environment, social justice, and corporate governance (ESG).
Socially responsible investing is a global phenomenon. With the international scope of business itself, social investors frequently invest in companies with international operations. As international investment products and opportunities have expanded, so have international SRI products. The ranks of social investors are growing throughout developed and developing countries.