Last night we had the pleasure of attending the ‘Going Green with your Money’ event, hosted by EQ Investors. We found it not only informative, but inspirational. If we each make small changes in our daily lives, from what we buy to where we invest, we can make a real difference in the world today – and for future generations.
Below are five key lessons we took away from the event:
»The difference between ethical and impact investing – Unfortunately, these terms are used interchangeably, although the investment approaches are completely different. Ethical investing involves avoiding or screening out ‘sin’ sectors such as tobacco, alcohol, weapons, pornography and gambling. By contrast, impact investing takes an active approach by investing in companies with products and services which have a positive impact on society and the environment.
»It’s now possible to bank ethically – This is a great one to share with your ethically-minded clients. These banks avoid lending to corporations that invest in sin sectors and are likely to have a strong ethical or environmental policy in place. Publications Ethical Consumer and Good with Money have created a list of banks to consider, which includes Triodos Bank, Charity Bank and Monzo (alongside other ‘challenger banks’).
»Every pound we spend can have an impact – When we each make small changes in our daily lives, our efforts result in a much larger cumulative action. Each time we spend with companies we believe in, we are casting our vote. We like the following graphic from the B Corp (visit the B Corp website for a short quiz to find B Corps to incorporate into your current daily routine).
»We can all reduce our contribution to climate change. The chart below says it all. We can make low impact decisions, like changing to more energy-efficient light bulbs; moderate decisions like recycling or washing clothes in cold water. The highest impact decisions include having one less child or avoiding plane travel. Interestingly, impact investing can contribute as much change as living car-free.
Personal actions we can all take:
» Shorter showers
» Switch off the lights
» Take public transport
» Reusable water or coffee cups
» Buy local/organic food
» Use an electric car
» Eat less meat
» Have fewer children
» Switch to renewable energy
» Mend and re-use items
» Use LED light bulbs
» Unplug the TV
» Use a bamboo toothbrush
» Buy second hand clothes
» Insulate your home
» Turn down the heating
Greenwashing is an issue
is the practice of making an unsubstantiated or misleading claim about the
environmental benefits of a product, service, technology or company practice.
Greenwashing can make a company appear to be more environmentally friendly than it really is. It can also be used to differentiate a company’s products or services from its competitors by promising more efficient use of power or by being more cost-effective over time.
Examples mentioned at the event include:
Yoghurt packaging, where the plastic is designed to look like wood!
And Fiji water, where every bottle is made of plastic and shipped around the world, which creates a huge carbon footprint.
Another example, more relevant in our market, is the Future World Fund. This fund ‘invests your money into companies that pledge to move to an environmentally-friendly economy’. The key word in this description is ‘pledge’: the companies are not actually doing this, as you can see from the fund’s top nine holdings:
- Apple Inc
- Royal Dutch Shell
- Proctor & Gamble
- Microsoft Corp
- Johnson & Johnson
- Costco Wholesale Group
- Exxon Mobil Corporation
- CVS Health Corporation
EQ Investors’ eye-opening event hammered home that we can all do more to make a positive change to society and the environment. The key is to avoid simply accepting the status quo: think about how the active decisions we make can have a positive impact. You can do this on a personal level, but also by helping your clients. Whether it is a case of banking ethically, eating less meat or buying a disposable coffee cup, it’s time to make a change.
Recycling statistic: in the UK we recycle just 53% of our plastic bottles (this means 47% end up in landfill). By comparison, the recycling rate in Germany is 97%!