Your investments make the world of difference. Here’s how to get started with sustainable investing.
In the past week, British newspaper The Guardian has uncovered some unsavoury findings linking big business to the worsening climate crisis.
Their research revealed that just 20 companies are responsible for a third of all carbon emissions.
Later, they showed that Google — among numerous other big brands — have been making large financial contributions to climate change deniers.
This comes at a time when hundreds of thousands of people are taking to the streets to encourage positive action. To see such damage being done by the world’s largest companies is unsettling.
The take-home message is that money talks.
Investors want a return on their investment. Companies want a political landscape that allows them to prosper without regulation — companies without a conscience, that is.
Today we’re going to look at how this way of doing things is dying. Here’s how sustainable investing can — and will — change the world.
The public demands change
The tide is turning. More customers are becoming aware of the problems of plastic pollution, the destruction caused by eating animal products and the climate catastrophe in general.
That awareness has led to huge, successful campaigns.
In the UK, the past decade has seen pressure grow on universities to divest from fossil fuels. Many of these institutions had large investments with near-guaranteed returns. But the cost to the planet — and their PR image — was too great to bear.
To date, over £11billion has been divested from UK universities.
That’s not to mention the huge growth in plant-based food alternatives, the rise of electric vehicles and the huge global protests against climate inaction.
The public is not willing to stand for exploitation and destruction any longer. If investors need clues into how things are changing, they need only open their eyes.
The effect of an unstable environment
Fossil fuels, tobacco and junk food were always safe bets when it came to investing. That’s because our capitalist system encouraged and protected them, through generous subsidies and political influence.
These cash cows were too valuable and too big to fall.
But that’s changing too.
The recent Google revelations, as mentioned above, show just that. We’ve reached a point where individual action against the climate crisis is no longer enough. We have to change on an industrial scale to limit catastrophic warming.
But public perception is not the only reason things have to change. Inaction will lead to worsening natural disasters and unstable environments for people and companies to thrive.
That instability is a risk for investors, regardless of how profitable oil and gas have been in the past. Sustainable action will be more sustainable for investors, too.
In every sense, we simply can’t afford to allow our planet to warm to beyond 1.5ºC.
How to get started in sustainable investing
Your investments reflect you more deeply than you have probably considered. Where you place your trust — and money — is a big part of your personality.
That doesn’t mean your wallet should take a hit. In fact, the International Monetary Fund recently stated that sustainable investments matched the success of ‘regular’ investments.
Getting started is simple, and it starts with research.
Look for projects that are close to your heart. For example, renewable energy in developing nations. Search for sustainable investment funds that highlight specific projects and do some more digging.
Check that it’s not just a case of corporate greenwashing. A truly sustainable investment fund will have consistency, not just a few token projects. Search for their ‘exclusions’ (projects they refuse to fund) and make sure there’s nothing unethical slipping through the net.
