On Tuesday night, BBC Panorama is set to accuse Comic Relief of investing in the tobacco, alcohol and arms industries. Hiding behind the laws of fiduciary duty, the charity maintains it has nothing to hide. But investing to contradict its mission is plain wrong.
If the defence is that if something is legal, it represents a valid investment opportunity, then if slavery was legal, would Comic Relief invest in it? The answer should, of course, be a resounding no. The practice was abolished nearly 200 years ago in the UK, and although it still happens in certain areas of the world, it is completely deplorable in any civil society.
Whether Comic Relief would invest in slavery raises some interesting issues. The charity, among the most popular in the UK, will tonight be accused by BBC Panorama of investing in tobacco, alcohol and armaments – specifically and most notably £630,000 in arms manufacturer BAE Systems.
The Campaign Against the Arms Trade (CAAT) points out that in 2010, BAE was fined £30m for selling an outdated military air traffic control system to Tanzania – a poverty-stricken country in which Comic Relief works to alleviate poverty.
These industries are odd bedfellows for any mission-driven organisation. But for a charity like Comic Relief, whose prime remit is to alleviate poverty and suffering at home and abroad, they surely contradict entirely. You don’t have to be an enlightened investor to see that investing in the very same tobacco firms whose products are causing premature death and widespread disease in places with little access to public health is wrong.
Despite this, Comic Relief’s response has been inadequate and certainly incommensurate to the justifiable criticism. It said last week, when the BBC revealed Panorama would be airing the investigation, that it had “nothing to hide”. It added that everything it was doing with its money was entirely legal – but this isn’t good enough. “It’s legal” is, as one tweeter pointed out, the worst possible answer in this situation.
“It’s legal” is not a defence – though it does raise necessary questions over the make-up of the current laws. That said, Charity Commission guidance, published in 2011, is fairly revealing: “The law permits the following reasons [for investing ethically, even if lower returns are anticipated]: a particular investment conflicts with the aims of the charity; or the charity might lose supporters or beneficiaries if it does not invest ethically; or there is no significant financial detriment.”
Simon Howard, chief executive of the UK Sustainable Investment and Finance Association (UKSIF), debunked a whole host of myths relating to the supposed underperformance of ethical funds last week. In response, Comic Relief said, “If we had invested £50m across the FTSE4Good indices, as opposed to the equivalent FTSE indices, we would have lost around £10m over the last 10 years.”
But instead of anything goes, what it should be saying is that it would be conducting a thorough internal investigation into its investment policies to ensure its money was not only avoiding the unethical industries, but not contradicting its core function as a charity.
Ethics are personal and certainly not black and white. If, for example, Comic Relief decided to invest in nuclear power, it would likely raise another interesting debate. There are benefits of nuclear as an energy source – it’s low-carbon and provides reliable power – as well as the well-known negative aspects such as proliferation. But can similar arguments be made for tobacco firms, the arms trade and alcohol manufacturers? “The returns are quite good” is not a legitimate riposte.
The problem with the Comic Relief situation is that it doesn’t control what its money is doing. It isn’t the first mission-driven organisation to have been caught out because of this. Whereas the likes of the Church of England invest partially in pooled funds – which allow investors to invest alongside others – Comic Relief puts its money into blue chip managed funds. These are large funds that deliver reliable returns, and which, in theory, would include companies like Wonga – which the church was found to be investing indirectly in back in July.
Jane Tully, head of policy and public affairs at the Charity Finance Group, said that charities should look to avoid investing against their stated missions “as a minimum”. She admitted, however, that it was often difficult in practice – particularly for large investors like Comic Relief.
She added, “Generally as good practice, all charities should have an investment policy that sets out the parameters of their investment activities, including at a high level what their trustees have agreed they can or can’t invest in.
“They should also consider the fact that the public expect them to be good and responsible investors. Investing in a way that conflicts with what they do, or damages reputation may harm their mission and have long-term impacts on donors’ willingness to give – a loss of support that may ultimately undermine the financial return generated anyway.”
The reputational impact of the BBC Panorama investigation on Comic Relief is as yet unknown. But it’s unlikely to do it any good in the eyes of the British public who so generously pledge money to its worthwhile cause each year.
To go back to my original question, if slavery was legal, would Comic Relief invest in it? Probably not. But tobacco, alcohol and the arms trade are seemingly decent bets – and making its charity work ever harder with every extra penny.
Comic Relief’s work is invaluable to the poorest people in our own country and overseas. Due to its mission and its reliance on the generous support of millions, we should rightly hold it to a higher standard than other investors.
We will always applaud Comic Relief’s many good works. But we must deplore such bad investment decisions and look forward to it revising its policies.
Will Self-Driving Cars Be Better for the Environment?
Technologists, engineers, lawmakers, and the general public have been excitedly debating about the merits of self-driving cars for the past several years, as companies like Waymo and Uber race to get the first fully autonomous vehicles on the market. Largely, the concerns have been about safety and ethics; is a self-driving car really capable of eliminating the human errors responsible for the majority of vehicular accidents? And if so, who’s responsible for programming life-or-death decisions, and who’s held liable in the event of an accident?
But while these questions continue being debated, protecting people on an individual level, it’s worth posing a different question: how will self-driving cars impact the environment?
The Big Picture
The Department of Energy attempted to answer this question in clear terms, using scientific research and existing data sets to project the short-term and long-term environmental impact that self-driving vehicles could have. Its findings? The emergence of self-driving vehicles could essentially go either way; it could reduce energy consumption in transportation by as much as 90 percent, or increase it by more than 200 percent.
That’s a margin of error so wide it might as well be a total guess, but there are too many unknown variables to form a solid conclusion. There are many ways autonomous vehicles could influence our energy consumption and environmental impact, and they could go well or poorly, depending on how they’re adopted.
One of the big selling points of autonomous vehicles is their capacity to reduce the total number of vehicles—and human drivers—on the road. If you’re able to carpool to work in a self-driving vehicle, or rely on autonomous public transportation, you’ll spend far less time, money, and energy on your own car. The convenience and efficiency of autonomous vehicles would therefore reduce the total miles driven, and significantly reduce carbon emissions.
There’s a flip side to this argument, however. If autonomous vehicles are far more convenient and less expensive than previous means of travel, it could be an incentive for people to travel more frequently, or drive to more destinations they’d otherwise avoid. In this case, the total miles driven could actually increase with the rise of self-driving cars.
As an added consideration, the increase or decrease in drivers on the road could result in more or fewer vehicle collisions, respectively—especially in the early days of autonomous vehicle adoption, when so many human drivers are still on the road. Car accident injury cases, therefore, would become far more complicated, and the roads could be temporarily less safe.
Deadheading is a term used in trucking and ridesharing to refer to miles driven with an empty load. Assume for a moment that there’s a fleet of self-driving vehicles available to pick people up and carry them to their destinations. It’s a convenient service, but by necessity, these vehicles will spend at least some of their time driving without passengers, whether it’s spent waiting to pick someone up or en route to their location. The increase in miles from deadheading could nullify the potential benefits of people driving fewer total miles, or add to the damage done by their increased mileage.
Make and Model of Car
Much will also depend on the types of cars equipped to be self-driving. For example, Waymo recently launched a wave of self-driving hybrid minivans, capable of getting far better mileage than a gas-only vehicle. If the majority of self-driving cars are electric or hybrids, the environmental impact will be much lower than if they’re converted from existing vehicles. Good emissions ratings are also important here.
On the other hand, the increased demand for autonomous vehicles could put more pressure on factory production, and make older cars obsolete. In that case, the gas mileage savings could be counteracted by the increased environmental impact of factory production.
The Bottom Line
Right now, there are too many unanswered questions to make a confident determination whether self-driving vehicles will help or harm the environment. Will we start driving more, or less? How will they handle dead time? What kind of models are going to be on the road?
Engineers and the general public are in complete control of how this develops in the near future. Hopefully, we’ll be able to see all the safety benefits of having autonomous vehicles on the road, but without any of the extra environmental impact to deal with.
New Zealand to Switch to Fully Renewable Energy by 2035
New Zealand’s prime minister-elect Jacinda Ardern is already taking steps towards reducing the country’s carbon footprint. She signed a coalition deal with NZ First in October, aiming to generate 100% of the country’s energy from renewable sources by 2035.
New Zealand is already one of the greenest countries in the world, sourcing over 80% of its energy for its 4.7 million people from renewable resources like hydroelectric, geothermal and wind. The majority of its electricity comes from hydro-power, which generated 60% of the country’s energy in 2016. Last winter, renewable generation peaked at 93%.
Now, Ardern is taking on the challenge of eliminating New Zealand’s remaining use of fossil fuels. One of the biggest obstacles will be filling in the gap left by hydropower sources during dry conditions. When lake levels drop, the country relies on gas and coal to provide energy. Eliminating fossil fuels will require finding an alternative source to avoid spikes in energy costs during droughts.
Business NZ’s executive director John Carnegie told Bloomberg he believes Ardern needs to balance her goals with affordability, stating, “It’s completely appropriate to have a focus on reducing carbon emissions, but there needs to be an open and transparent public conversation about the policies and how they are delivered.”
The coalition deal outlined a few steps towards achieving this, including investing more in solar, which currently only provides 0.1% of the country’s energy. Ardern’s plans also include switching the electricity grid to renewable energy, investing more funds into rail transport, and switching all government vehicles to green fuel within a decade.
Zero net emissions by 2050
Beyond powering the country’s electricity grid with 100% green energy, Ardern also wants to reach zero net emissions by 2050. This ambitious goal is very much in line with her focus on climate change throughout the course of her campaign. Environmental issues were one of her top priorities from the start, which increased her appeal with young voters and helped her become one of the youngest world leaders at only 37.
Reaching zero net emissions would require overcoming challenging issues like eliminating fossil fuels in vehicles. Ardern hasn’t outlined a plan for reaching this goal, but has suggested creating an independent commission to aid in the transition to a lower carbon economy.
She also set a goal of doubling the number of trees the country plants per year to 100 million, a goal she says is “absolutely achievable” using land that is marginal for farming animals.
Greenpeace New Zealand climate and energy campaigner Amanda Larsson believes that phasing out fossil fuels should be a priority for the new prime minister. She says that in order to reach zero net emissions, Ardern “must prioritize closing down coal, putting a moratorium on new fossil fuel plants, building more wind infrastructure, and opening the playing field for household and community solar.”
A worldwide shift to renewable energy
Addressing climate change is becoming more of a priority around the world and many governments are assessing how they can reduce their reliance on fossil fuels and switch to environmentally-friendly energy sources. Sustainable energy is becoming an increasingly profitable industry, giving companies more of an incentive to invest.
Ardern isn’t alone in her climate concerns, as other prominent world leaders like Justin Trudeau and Emmanuel Macron have made renewable energy a focus of their campaigns. She isn’t the first to set ambitious goals, either. Sweden and Norway share New Zealand’s goal of net zero emissions by 2045 and 2030, respectively.
Scotland already sources more than half of its electricity from renewable sources and aims to fully transition by 2020, while France announced plans in September to stop fossil fuel production by 2040. This would make it the first country to do so, and the first to end the sale of gasoline and diesel vehicles.
Many parts of the world still rely heavily on coal, but if these countries are successful in phasing out fossil fuels and transitioning to renewable resources, it could serve as a turning point. As other world leaders see that switching to sustainable energy is possible – and profitable – it could be the start of a worldwide shift towards environmentally-friendly energy.
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