It’s time to look at five areas where you can invest sustainably. Yesterday, day six of our countdown to the end of our crowdfunding campaign, we looked at the sextet of sin stocks. Today we look at the saint stocks to be included.
As UKSIF chief executive Penny Shepherd pointed out in a recent article during National Ethical Investment Week, investing ethically is a little bit more involved than unethical investing but fortunately, Blue & Green Tomorrow is here to clear the path. If you can help us do this, we’ll do the hard reading and research so you don’t have to.
Climate change – it’s a clear and present danger to our way of life
Whatever the cause, our climate is changing, and we need to mitigate, or make less severe, our contribution to that change; adapt to unavoidable change it or geoengineer (the deliberate large-scale intervention in the Earth’s climate system, in order to moderate global warming) our way out of the mess.
This pecking order, 1) mitigate, 2) adapt and 3) geoengineer, is often trotted out, but the order is important. It is better to reduce our impact (mitigate), before we are forced to adapt to inevitable change. The last on the list is geoengineering, as on paper it offers a straightforward engineering solution and means we can carry on business as usual. The downside is any ‘large-scale intervention in the Earth’s climate system’ is going to have unforeseen consequences and the scale of that intervention may be beyond us.
Some funds invest in green or clean technology or renewable energy companies and/or screen out those with heavy carbon footprints.
If you’re most concerned about climate change, then look for or ask about funds that take this approach.
The environment – there’s more to the biosphere than the climate
As we, and Zac Goldsmith, often point out, the single issue of carbon emissions often disguises the broader issue of widespread pollution and waste. Any level of pollution and waste means harm and inefficiency in a process, so the lowest polluting and least waste-creating companies are, by definition the least harmful, most efficient and sustainable.
Funds may seek the best green performers and to screen out those with poor records on waste or pollution.
If you’re most concerned about the environment, then look for or ask about funds that take this approach.
Equal opportunities – sustainability is about people as well as the planet
For years, business practices have ignored discrimination on the grounds of race, gender, disability, age and sexuality. It is only over the howls of indignation that business lobbies and companies have been dragged kicking and screaming, using law, to more enlightened practices. This is not the case throughout the world and many developed world countries rely on divisions or third parties that do not subscribe to standards of behaviour that we would accept as normal.
Funds may take companies’ performance on key issues like race, gender, disability, age and sexuality into consideration.
If you’re most concerned about equality, then look for or ask about funds that take this approach.
Human rights – no really; humans and their rights really matter
Ever since the Universal Declaration of Human Rights (UDHR) was adopted in 1948, individuals, corporations and governments around the world have been doing their level best to circumvent or override them.
While a corporation is not a member state or signatory of the UDHR, one would like to think that as they enjoy the freedoms of living in a country subject to the articles, they would use their considerable power and reach to adhere to them in principle and practice.
If a company treats it employees unfairly they are in breach of article 23 that, “Everyone has the right to work, to free choice of employment, to just and favourable conditions of work and to protection against unemployment.” If a company invests in or supports an oppressive regime that are in breach of almost every single clause.
Funds that have human rights at their core ask whether a company treat its employees fairly or whether it has dealings with oppressive regimes.
If you’re most concerned about human rights then look for or ask about funds that take this approach.
Positive business focus – and sustainability means stronger profits
As repeated research has shown, companies that act more sustainably reap higher long-term profits. As the CBI recently reported, low-carbon products and services could add £20 billion to Britain’s GDP by 2015.
Funds can choose to invest in companies that contribute positively to society and the environment such as green technology companies, healthcare or public transport systems.
If you’re most concerned about companies playing appositive role in society, then look for or ask about funds that take this approach.
Get the right advice
So there you have it. These are just five of the positive investment options for the enlightened and engaged investor and six sectors to avoid.
Don’t be fobbed off by misinformed financial advisers and profiteering commentators who discourage you from matching your ethics and values with your investment approach, at any cost to society and the environment.
A large number of financial advisers would simply place your money with whoever paid them the most commission – until RDR kicks in at the end of the year, and then they won’t touch you unless you’re wealthy.
Remember, financial advisers are human and dependent on their bounded rationality, experience, prejudices and need for income.
An ethical IFA is simply one that has specialist knowledge of ethical stocks and funds. An IFA is required by the FSA to take into account your ethics and values, and an ethical IFA is just more able to do so. Most don’t or try and put you off doing so.
The enlightened and engaged kind of people who choose a specialist ethical IFA over another IFA tend to want to place more importance on ethical considerations but it’s a continuum from dark green (maximise good) to light green (minimise harm) to couldn’t give a fig (sin stock territory).
We strongly recommend the following:
If you’re not covered by one of the above you can find more at the Ethical Investment Association, the industry body of specialist ethical financial advisers.
In the meantime, here’s another five reasons to invest in ethical funds from our National Ethical Investment Week coverage.
How to Build An Eco-Friendly Home Pool
Swimming pools are undoubtedly one of the most luxurious features that any home can have. But environmentally-conscious homeowners who are interested in having a pool installed may feel that the potential issues surrounding wasted water, chemical use and energy utilized in heating the water makes having a home swimming pool difficult to justify.
But there is good news, because modern technologies are helping to make pools far less environmentally harmful than ever before. If you are interested in having a pool built but you want to make sure that it is as eco-friendly as possible, you can follow the advice below. From natural pools to solar panel heating systems, there are many steps that you can take.
Choose a natural pool to go chemical free
For those homeowners interested in an eco-friendly pool, the first thing to consider is a natural pool. Natural swimming pools utilise reed bed technology or moss-filtration to naturally filter out dirt from the water. These can be combined with eco-pumps to allow you to have a pool that is completely free from chemicals.
Not only are traditional pool chemicals potentially harmful to the skin, they also mean that you can contaminate the area around the pool if chemical-filled water leaks or is splashed around. This can be bad for your garden and the environment general.
It will be necessary to work with an expert pool builder to ensure that you have the expertise to get your natural pool installed properly. But the results with definitely be worth the effort and planning that you have to put in.
Avoid concrete if possible
The vast majority of home pools are built using concrete but this is far from ideal in terms of an eco-friendly pool for a large number of reasons. Concrete pools are typically built and then lined to stop keep out any bacteria. This is theoretically fine, except that concrete is porous and the lining can be liable to erode or break which can allow bacteria to enter the pool.
It is much better to use a non-porous material such as fibreglass or carbon ceramic composite for your pool. Typically, these swimming pools are supplied in a one-piece shell rather than having to be built from scratch, ensuring a bacteria-free environment. These non-porous materials make it impossible for the water to become contaminated through bacteria seeping into the pool by osmosis.
The further problem that can arise from having a concrete pool is that once this bacteria begins to get into the pool it can be more difficult for a natural filtration system to be effective. This can lead to you having to resort to using chemicals to get the pool clean.
Add solar panels
It is surprising how many will go to extreme lengths to ensure that their pool is as eco-friendly as possible in terms of building and maintaining it but then fall down on something extremely obvious. No matter what steps you take with the rest of your pool, it won’t really be worth the hassle if you are going to be conventionally heating your pool up, using serious amounts of energy to do so.
Thankfully there are plenty of steps you can take to ensure that your pool is heated to a pleasant temperature while causing minimal damage to the environment. Firstly, gathering energy using solar panels has become a very popular way to reduce consumption of electricity as well as decreasing utility bills. Many businesses offer solar panels specifically for swimming pools.
Additionally, installing an energy efficient heat pump or boiler to work in conjunction with your solar panels can be hugely beneficial.
Finally, it is worth remembering that there are many benefits to investing in a pool cover. When you cover your pool you increase its heat retention which stops you from having to power a pump or boiler to keep it warm. This works in conjunction with the solar panels and eco-friendly heating system that you have already had installed.
Additionally, you cover helps to keep out dirt and other detritus that can enter the pool, bringing in bacteria. Anything that you can do to keep bacteria out will be helpful in terms of keeping it clean.
4 Ways To Get a Green House in 2018
Demand for green houses is surging. In 2020, almost 20% of all homes on the market will be green.
If you would like to buy a green home, this is a great time to look into it. Prices are still pretty low and there are a lot more financing options available than there were right after the recession.
If you’re thinking about buying a house, now could be a very good time to make the move! A number of factors in the housing market right now mean that you might be able to afford your dream home. Although in many parts of the country house prices are still rising, if you do your research and plan wisely, there are lots of good schemes to help you get your foot on the property ladder, or trade up to the house you’ve always wanted.
Interest Rates and Stamp Duty
Although the Bank of England raised interest rates by 0.25% recently, they remain very low, which is good news if you’re thinking of taking out a mortgage. However, rates may not stay low and it’s predicted that there’ll be a further rate rise during 2018, so don’t wait too long. Another factor that’s going to help first time buyers in particular is the Chancellor’s decision to abolish stamp duty for first timers purchasing properties for under £300,000.
For many people looking to buy a green home, raising a deposit of between 5% and 20% may not be a realistic option, in which case there are a growing number of schemes to help. Increasingly popular are shared ownership schemes, through which the buyer pays a percentage of the full value of the property (typically between 25% and 75%) and the local council or a housing association pays the rest, and takes part ownership. This is suitable for buyers who may struggle to meet the up-front costs of buying outright. There will often be a service charge or management fees to pay in addition to the mortgage. The Government’s Help To Buy scheme is a good place to start looking if you’re interested in this option. This scheme is now available to people looking to buy green homes too.
If you’re still saving for a deposit, another scheme is the Help to Buy ISA. You can get a 25% boost to your savings on amounts up to £200 per month with this scheme. It’s only open to first time buyers and you can claim a maximum of £3000.
Green home buyers are going to run into a number of other ancillary costs, most of which are common to other homebuyers.
When calculating how much you can afford, it’s vitally important to remember that buying a house comes with a whole host of other costs. Depending on the cost of the property that you’re buying, you may have to pay stamp duty of anywhere between 1% and 5%. There’ll be estate agents fee if you’re also selling a property, although there are a wide range of online estate agents operating such as Purple Bricks or Right Move that have lower fees than traditional high street companies. Conveyancing costs to a solicitor can add another £1000-£3000 and you may need to take out life insurance and hire a moving firm.
There are other initial costs such as, fixing parts of the home that aren’t upto your taste. Getting new furniture to fill up all the new-found space in your new home. If you are moving away from the city, you need to consider the cost of transportation as well, as it can take up quite a lot over time. Take your time, do your homework and shop around and soon you could be getting the keys to your perfect home.
I hope this article was useful for you to learn more about the basics that you need to be aware of before you start the process of buying your first home. If you have any doubts with regards to this, let us know through the comments and we will be glad to help you out. If you have any suggestions regarding how we can improve the article, let us know them through the comments as well for us to improve.
Do you have any other reservations against buying your first home? Do you see your house as an asset or a liability? Do you think it is important for everyone to get themselves a new home? Let us know through the comments.