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A multi-asset fund with a healthy, sustainability-centred balance

Camilla Ritchie, investment manager at Seven Investment Management, spoke to Alex Blackburne about their Sustainable Balance Fund – a fund that aims to achieve equilibrium between income and capital, with an underlying sustainability theme.

The investment sector often isn’t for the faint-hearted. Certainly, given the current volatility of stock markets globally, making a commitment to a fund can be a potentially disastrous risk.

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Camilla Ritchie, investment manager at Seven Investment Management, spoke to Alex Blackburne about their Sustainable Balance Fund – a fund that aims to achieve equilibrium between income and capital, with an underlying sustainability theme.

The investment sector often isn’t for the faint-hearted. Certainly, given the current volatility of stock markets globally, making a commitment to a fund can be a potentially disastrous risk.

The majority of the over 90-strong ethical funds in the UK are equities, meaning they invest in stocks and shares. This makes them prone to sometimes drastic instability, but the ultimate rewards can be very lucrative.

What happens, though, if you are swayed by Blue & Green Tomorrow’s cutting edge features about why you should invest ethically, but you’re not willing to enter the potential perils of the ethical equity market?

Well, there is at least one fund that could fit your needs.

The Seven Investment Management (7IM) Sustainable Balance Fund provides individuals with, as its name suggests, a balance.

Instead of investing in stocks and shares, the fund is multi-asset, meaning it distributes its investments around other assets, such as cash and bonds.

By offering a balanced risk profile, 7IM is significantly reducing the hazard involved, thus appealing to perhaps more cautious investors.

Camilla Ritchie, investment manager at 7IM, highlights the fund’s key background.

It’s a sustainable fund, but it has ethical exclusions”, she says. “But I would say it’s more of a positively focused sustainable fund rather than a negatively focused ethical fund.

It used to be called the Ethical Fund, but the idea behind calling it the Sustainable Balance Fund was that we wanted to emphasise the fact that it’s sustainable more than ethical, but also, we wanted to emphasise the fact that it had a balanced risk profile”.

Set up at the beginning of 2007, the fund is now worth around £28m. Despite the obvious investment limitations because of the ethical and sustainable criteria in place, admirably, its performance has been in line with unconstrained funds that have similar risk profiles.

7IM uses a Swiss company called Sarasin & Partners, a London-based investment manager that has a substantial sustainable research resource in Switzerland, which it uses to screen potential companies to invest in.

[Sarasin] runs a matrix comparing the environmental and social aspects of each of the companies that it sees, to decide whether they are sustainable or not”, says Ritchie.

The research facility out in Switzerland not only looks at companies – but also at countries, from the point of view of deciding whether their bonds are sustainable or not”.

The cooperation with Sarasin & Partners, Ritchie claims, is one of the major reasons as to why people should consider the 7IM Sustainable Balance Fund. Having the expertise of two companies of such esteem certainly gives the fund a leg up in terms of attracting investors.

Sarasin & Partners assesses various sectors in order to select companies to invest in, looking at social and environmental aspects of each. After matching the company to specific criteria, the information is entered into a matrix to determine whether an investment opportunity is available.

In some sectors, you wouldn’t find any companies that are suitable, and that would really be to do with the sustainability of the sector as a whole”, explains Ritchie.

Sectors like gold mining are unsustainable, and so you’re not going to find any gold company which is going to pass any of the criteria, particularly social, as I’d imagine some of them are in places where work practices are not socially acceptable  – so that sector probably would be excluded at the outset.

But there are other sectors that are generally sustainable and companies within then that have generally good social and environmental practices.

After analysis using the matrix system, this should throw up which of those companies are the best of breed in their sector in sustainability terms”.

As Blue & Green Tomorrow continues to show, there are lots of options to choose from if an individual wishes to invest their money in an ethical fashion.

Whatever your morals or ethics, there is a fund for you. But why should people consider doing this?

I don’t want to proselytise or dictate what people should do, but I genuinely feel that people ought to consider the environment and how much of the world’s resources we’re using”, Ritchie stated.

If we are able to invest in companies that have a lower carbon footprint than others, then I think that that is the better thing to do.

From an environmental point of view, it’s preferable to invest in stocks that have a lower carbon footprint, and also it’s preferable to invest in stocks where the companies are behaving in a better way towards their workers, so the social environment is better”.

The most important thing is not to get overawed by investments. It can be a confusing, and it can be tedious, but when it comes down to it, if your money is invested in sustainable places, the aftereffects really are world-changing.

Why not start a trend by choosing picking an ethical fund that mirrors your beliefs. For the more wary folk, the 7IM Sustainable Balance Fund might just be perfect.

It’s very difficult to see where things are going at the moment, and it would be sensible to have a cautious view at this stage, because we just don’t know how the financial crisis and the Eurozone are going to play out”, Ritchie says, looking ahead.

In some ways, markets are very binary at the moment – you either think it’s going to work out, in which case the stock markets will be fine, or you don’t think it’s going to work out, and if that’s the case, there is nobody who really knows how that might affect markets, or whether they might completely unravel.

If you are looking to take a slightly more cautious view, then maybe a more balanced risk profile is the best solution”.

If you’re interested in the 7IM Sustainable Balance Fund, get in touch with them through their website.

Or if you’re interested in ethical investing more generally, ask your financial adviser or fill in our form if you don’t have one, and we’ll connect you to a specialist ethical one.

Economy

How Going Green Can Save A Company Money

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going green can save company money
Shutterstock Licensed Photot - By GOLFX

What is going green?

Going green means to live life in a way that is environmentally friendly for an entire population. It is the conservation of energy, water, and air. Going green means using products and resources that will not contaminate or pollute the air. It means being educated and well informed about the surroundings, and how to best protect them. It means recycling products that may not be biodegradable. Companies, as well as people, that adhere to going green can help to ensure a safer life for humanity.

The first step in going green

There are actually no step by step instructions for going green. The only requirement needed is making the decision to become environmentally conscious. It takes a caring attitude, and a willingness to make the change. It has been found that companies have improved their profit margins by going green. They have saved money on many of the frivolous things they they thought were a necessity. Besides saving money, companies are operating more efficiently than before going green. Companies have become aware of their ecological responsibility by pursuing the knowledge needed to make decisions that would change lifestyles and help sustain the earth’s natural resources for present and future generations.

Making needed changes within the company

After making the decision to go green, there are several things that can be changed in the workplace. A good place to start would be conserving energy used by electrical appliances. First, turning off the computer will save over the long run. Just letting it sleep still uses energy overnight. Turn off all other appliances like coffee maker, or anything that plugs in. Pull the socket from the outlet to stop unnecessary energy loss. Appliances continue to use electricity although they are switched off, and not unplugged. Get in the habit of turning off the lights whenever you leave a room. Change to fluorescent light bulbs, and lighting throughout the building. Have any leaks sealed on the premises to avoid the escape of heat or air.

Reducing the common paper waste

paper waste

Shutterstock Licensed Photo – By Yury Zap

Modern technologies and state of the art equipment, and tools have almost eliminated the use of paper in the office. Instead of sending out newsletters, brochures, written memos and reminders, you can now do all of these and more by technology while saving on the use of paper. Send out digital documents and emails to communicate with staff and other employees. By using this virtual bookkeeping technique, you will save a bundle on paper. When it is necessary to use paper for printing purposes or other services, choose the already recycled paper. It is smartly labeled and easy to find in any office supply store. It is called the Post Consumer Waste paper, or PCW paper. This will show that your company is dedicated to the preservation of natural resources. By using PCW paper, everyone helps to save the trees which provides and emits many important nutrients into the atmosphere.

Make money by spreading the word

Companies realize that consumers like to buy, or invest in whatever the latest trend may be. They also cater to companies that are doing great things for the quality of life of all people. People want to know that the companies that they cater to are doing their part for the environment and ecology. By going green, you can tell consumers of your experiences with helping them and communities be eco-friendly. This is a sound public relations technique to bring revenue to your brand. Boost the impact that your company makes on the environment. Go green, save and make money while essentially preserving what is normally taken for granted. The benefits of having a green company are enormous for consumers as well as the companies that engage in the process.

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Energy

5 Easy Things You Can Do to Make Your Home More Sustainable

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sustainable homes
Shutterstock Licensed Photot - By Diyana Dimitrova

Increasing your home’s energy efficiency is one of the smartest moves you can make as a homeowner. It will lower your bills, increase the resale value of your property, and help minimize our planet’s fast-approaching climate crisis. While major home retrofits can seem daunting, there are plenty of quick and cost-effective ways to start reducing your carbon footprint today. Here are five easy projects to make your home more sustainable.

1. Weather stripping

If you’re looking to make your home more energy efficient, an energy audit is a highly recommended first step. This will reveal where your home is lacking in regards to sustainability suggests the best plan of attack.

Some form of weather stripping is nearly always advised because it is so easy and inexpensive yet can yield such transformative results. The audit will provide information about air leaks which you can couple with your own knowledge of your home’s ventilation needs to develop a strategic plan.

Make sure you choose the appropriate type of weather stripping for each location in your home. Areas that receive a lot of wear and tear, like popular doorways, are best served by slightly more expensive vinyl or metal options. Immobile cracks or infrequently opened windows can be treated with inexpensive foams or caulking. Depending on the age and quality of your home, the resulting energy savings can be as much as 20 percent.

2. Programmable thermostats

Programmable thermostats

Shutterstock Licensed Photo – By Olivier Le Moal

Programmable thermostats have tremendous potential to save money and minimize unnecessary energy usage. About 45 percent of a home’s energy is earmarked for heating and cooling needs with a large fraction of that wasted on unoccupied spaces. Programmable thermostats can automatically lower the heat overnight or shut off the air conditioning when you go to work.

Every degree Fahrenheit you lower the thermostat equates to 1 percent less energy use, which amounts to considerable savings over the course of a year. When used correctly, programmable thermostats reduce heating and cooling bills by 10 to 30 percent. Of course, the same result can be achieved by manually adjusting your thermostats to coincide with your activities, just make sure you remember to do it!

3. Low-flow water hardware

With the current focus on carbon emissions and climate change, we typically equate environmental stability to lower energy use, but fresh water shortage is an equal threat. Installing low-flow hardware for toilets and showers, particularly in drought prone areas, is an inexpensive and easy way to cut water consumption by 50 percent and save as much as $145 per year.

Older toilets use up to 6 gallons of water per flush, the equivalent of an astounding 20.1 gallons per person each day. This makes them the biggest consumer of indoor water. New low-flow toilets are standardized at 1.6 gallons per flush and can save more than 20,000 gallons a year in a 4-member household.

Similarly, low-flow shower heads can decrease water consumption by 40 percent or more while also lowering water heating bills and reducing CO2 emissions. Unlike early versions, new low-flow models are equipped with excellent pressure technology so your shower will be no less satisfying.

4. Energy efficient light bulbs

An average household dedicates about 5 percent of its energy use to lighting, but this value is dropping thanks to new lighting technology. Incandescent bulbs are quickly becoming a thing of the past. These inefficient light sources give off 90 percent of their energy as heat which is not only impractical from a lighting standpoint, but also raises energy bills even further during hot weather.

New LED and compact fluorescent options are far more efficient and longer lasting. Though the upfront costs are higher, the long term environmental and financial benefits are well worth it. Energy efficient light bulbs use as much as 80 percent less energy than traditional incandescent and last 3 to 25 times longer producing savings of about $6 per year per bulb.

5. Installing solar panels

Adding solar panels may not be the easiest, or least expensive, sustainability upgrade for your home, but it will certainly have the greatest impact on both your energy bills and your environmental footprint. Installing solar panels can run about $15,000 – $20,000 upfront, though a number of government incentives are bringing these numbers down. Alternatively, panels can also be leased for a much lower initial investment.

Once operational, a solar system saves about $600 per year over the course of its 25 to 30-year lifespan, and this figure will grow as energy prices rise. Solar installations require little to no maintenance and increase the value of your home.

From an environmental standpoint, the average five-kilowatt residential system can reduce household CO2 emissions by 15,000 pounds every year. Using your solar system to power an electric vehicle is the ultimate sustainable solution serving to reduce total CO2 emissions by as much as 70%!

These days, being environmentally responsible is the hallmark of a good global citizen and it need not require major sacrifices in regards to your lifestyle or your wallet. In fact, increasing your home’s sustainability is apt to make your residence more livable and save you money in the long run. The five projects listed here are just a few of the easy ways to reduce both your environmental footprint and your energy bills. So, give one or more of them a try; with a small budget and a little know-how, there is no reason you can’t start today.

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