In the spirit of media harmony that heralds National Ethical Investment Week, the Investors Chronicle chose to run an article headlined, “Why investing in ‘good’ funds could ruin your returns”. Simon Leadbetter addresses a spectacular case of ‘missing the point entirely’.
In a headline and first paragraph pairing that would put journalists at The Sun to shame, Katie Morley of the Investors Chronicle provides a masterclass in how to mislead a reader. The headline to this article rather depressingly reveals the prejudice of the writer before we even start. She compounds this by setting up straw men such as, “Would you risk investment returns on your hard-earned cash to make a small positive difference to the world of businesses?” The obvious answer to this question is, “No Katie, because I’m not an idiot.”
She completes her first paragraph with a call to action against ‘good’ funds: “You should steer clear of ‘ethical’ funds, advisers are warning.” Reading the whole article, you will see that no, you shouldn’t and no, advisers don’t.
Morley then reveals her own confusion and states what to us is bleeding obvious: “Everyone’s concept of ‘ethical’ is different”. Yes it is. Of course it is, Katie. Global history rather points to that being a truism. However, the point of ethical investing is to ask the questions in the first place, both as an adviser and investor and allowing the investor to make an informed choice. If you hold a moral viewpoint or support a particular ethical cause, you might be bothered if the fund you had put money in invested in companies that actively work against your values.
Looking for a scandal that just is not there, Morley then expresses her concern that we might be surprised “to learn that the majority of ethical funds invest in major banks, as well as oil companies.” If you are surprised, then your IFA has not been doing their job properly. While she recognises these “industries have earned a distinctly ’immoral’ reputation in recent years”, she doesn’t seem to care that people would be surprised they are investing in them. Banks and oil companies are a reality. Reducing their share in a portfolio or fund can be a positive step to creating a more balanced approach.
Not letting her prejudice hide for one minute, she explains to us that, “More predictably, ethical funds do tend to exclude stocks with exposure to other ‘unethical’ industries such as fur, tobacco and alcohol.” Why is that wearily described as more predictable? Of course it is predictable, Katie. People with certain ethical views tend to object to killing animals for fashion, killing people in countries with poor public health or education programmes through promoting smoking and the less than savoury marketing techniques of the drinks industry.
She finds a friend in Jason Hollands, managing director of business development and communications at Bestinvest (note: business development means sales).
Hollands says, “During tough economic times, people still smoke and they still drink, meaning ‘unethical’ companies, despite damaging other people’s health, are defensive assets that will actually protect your portfolio. Ethical companies such as wind turbine and solar energy producers look the most flimsy during a recession, which is not very reassuring for private investors.”
OK, that’s alright then. So, if you’re dying of lung cancer, cyrohsis and maybe even campaign against smoking and excessive drinking, you shouldn’t let the little fact that your pension is invested in these companies bother you. Really Jason, really? “…despite damaging other people’s health.” Does anyone else hear the terrible silence of a moral vacuum that impoverishes our society and capitalism more generally?
Morley adds a specific dire warning: “The approach ringing the most alarm bells is called ‘negative screening’, whereby ‘bad’ companies or entire sectors are banned from the fund’s portfolio. Everyone we spoke to said this exclusionary method could strangle your returns and send your investment risk through the roof by killing diversification. So if there’s anything to avoid like the plague, it’s funds deploying this strategy.”
No Katie, no. If you are genuinely concerned about the global issues caused by weapon proliferation, gambling, pornography, smoking, animal testing and alcohol abuse, you probably don’t want to invest in companies engaged in those activities. Colloquially they are known as the sin stocks. The line, “everyone we spoke to”, is a deeply misleading phrase akin to the pub favourite, “everyone knows”. One thing you can be certain of is that anyone who enlists ‘everyone’ to their cause is speaking only for themselves. From what we can see, she didn’t speak to anyone who was very informed on the issues involved.
She states that, “Negative screening is badmouthed even by ethical investment experts themselves.” Negative screening is obviously right for some with strongly held views, and is very rarely badmouthed by advisers who genuinely care about their clients’ concerns and values. Sadly, many IFAs don’t care at all about their clients’ values and are more concerned about commissions and fees. This is despite the Financial Services Authority issuing guidelines on fact checks that advisers should take into account the beliefs and views of an investor.
Morley goes on to say that there is a better way (phew!) in the shape of positive screening, “whereby funds mangers pick the companies they believe are the most ethical”. That’s not quite right Katie, but we’ll let it pass.
This is backed by David Harris, manager of the FTSE4Good index and vice-chairman of the UK Sustainable Investment and Finance Association (UKSIF). Lost in several fact-free paragraphs that precede this, he actually points out that, “Investing with ethics in mind can reap rewards in the form of returns, claiming all but one of the environmental FTSE indices has outperformed equivalent ‘non-ethical’ indices.”
Hold on. “All but one of the environmental FTSE indices has outperformed equivalent ‘non-ethical’ indices”. Let’s refer back to the article’s headline: “Why investing in ‘good’ funds could ruin your returns”. How do these two points tally? They don’t, basically.
Morley concludes that, “Off-the record, advice from most of the advisers we spoke to goes as follows: If you care about a cause enough that you would stake your money on it, positively screened ethical funds are worth a look. But if you want to keep your nest egg safe, giving to charity or buying ethical products – such as fair trade coffee – will put your money to just as good use, without the risk.”
Unable to put anyone on the record (despite the gratuitous use of ‘everyone’ and ‘most’) and allowing her own prejudice to cloud her judgment, she presents the contradictory view that we should give to charity, ignoring the fact that companies we invest in may be directly undermining the work of the charity we support. Katie, charitable giving in the UK was £11 billion in 2010/2011 (NVCO/CAF) and assets under management was £4.2 trillion (IMA). Charity isn’t going to address the issues created by what we invest in. For every pound of charitable giving, £382 is assets under management.
As for, “Buying ethical products – such as fair-trade coffee”, according to the Co-operative, the size of the ethical goods and services market in the UK is £47 billion, with fair trade representing £1 billion. All minnows compared to the £4.2 trillion assets under management.
This is a fundamentally flawed, fact-free and misinformed opinion piece masquerading as journalism. We really would expect better from the Investors Chronicle. A better headline would be “Why investing in ‘unsustainable’ funds could ruin your planet and your children’s future.” However, we are not entirely sure Morley has done her research, knows enough about the subject, or can even hide her prejudices enough to write that particular article. Must try harder, Katie.
National Ethical Investment Week runs until Saturday, October 20. Join the movement on Twitter using the hashtag #NEIW12.
What Kitchen Suits Your Style? Modern, Classic or Shaker?
A kitchen is the centre of the home. Your kitchen ranges between where friends and family gather, talk about their day, cook meals, have drinks, to somewhere you can just enjoy each other’s company. The kitchen is the heart of the home. But, everyone’s lifestyle is different. Everyone’s taste is different. So, you need a kitchen that not only mirrors your lifestyle but matches your taste too. Whilst some prefer a more traditional design, others want a modern feel or flair – and it’s all down to personal taste.
When it comes to redesigning your kitchen, what style would you go for? It’s a difficult one isn’t it. With so many different styles to go for, how can you know exactly what you want until you’ve seen it in action? Leading kitchen designer, Roman Kitchens, based in Essex, have provided three examples of bespoke kitchens and styles they specialise in, accompanied with beautiful images. This design guide will get you one step closer to picking your dream kitchen for your home.
New home in the city centre? Or even a sleek new modern build? You want a trendy and modern kitchen to reflect your city lifestyle. In modern kitchen design, colours are bolder and fresher, with sleek design and utilities that are distinctive and vibrant.
This modern kitchen is sleek and smooth with flawless design and beauty. Minimalism doesn’t stop this kitchen standing out. Featured walls of wood and vibrant mint green draw the eye, whilst the white surfaces reflect the light, illuminating every nook and cranny of this kitchen. This kitchen features products from Rotpunkt, innovators of modern kitchen design. Made with German engineering, a Rotpunkt Kitchen is the ultimate modern addition to your home. Rotpunkt Kitchens have timeless design and amazing functionality, they work for every purpose and are eco-friendly. Sourced from natural materials, a Rotpunkt kitchen uses 37% less timber, conserving natural forests and being more environmentally conscious.
Prefer a homely and traditional feel? Classic kitchens are warm, welcoming and filled with wood. Wood flooring, wood fixtures, wood furniture – you name it! You can bring a rustic feel to your urban home with a classic kitchen. Subtle colours and beautiful finishes, Classic kitchens are for taking it back to the basics with a definitive look and feel.
With stated handles for cupboards, Classic kitchens are effortlessly timeless. They convey an elegant but relaxing nature. Giving off countryside vibes, natural elements convey a British countryside feel. The wood featured in a classic kitchen can range between oaks and walnut, creating a warmth and original feel to your home. Soft English heritage colours add a certain mood to your home, softening the light making it cosier.
Any kitchen planner will tell you that the meeting point between traditional and modern design, is a Shaker kitchen. They have a distinctive style and innovative feel. Shakers are fresh, mixing different colour tones with stylish wood and vinyl. The most important feature of a Shaker kitchen is functionality – every feature needs to serve a purpose in the kitchen. Paired with stylish and unique furniture, a Shaker kitchen is an ideal addition to any home.
The ultimate marriage between Classic and Modern kitchens, this Shaker kitchen has deep colour tones with copper emphasis features. All the fittings and fixtures blur the line of modern and tradition, with a Classic look but modern colour vibe. Unique furniture and design make Shaker Kitchens perfect for the middle ground in kitchen design. Minimal but beautifully dressed. Traditional but bold and modern at the same time. Storage solutions are part of the functionality of Shaker kitchens, but don’t detour from conveying yours as a luxury kitchen.
Whatever you choose for your new kitchen, be it Modern, Classic or Shaker – pick whatever suits you. Taste is, and always will be, subjective – it’s down to you.
Ways Green Preppers Are Trying to Protect their Privacy
Environmental activists are not given the admiration that they deserve. A recent poll by Gallup found that a whopping 32% of Americans still doubt the existence of global warming. The government’s attitude is even worse.
Many global warming activists and green preppers have raised the alarm bell on climate change over the past few years. Government officials have taken notice and begun tracking their activity online. Even former National Guard officers have admitted that green preppers and climate activists are being targeted for terrorist watchlists.
Of course, the extent of their surveillance depends on the context of activism. People that make benign claims about climate change are unlikely to end up on a watchlist, although it is possible if they make allusions to their disdain of the government. However, even the most pacifistic and well intentioned environmental activists may unwittingly trigger some algorithm and be on the wrong side of a criminal investigation.
How could something like this happen? Here are some possibilities:
- They could share a post on social media from a climate extremist group or another individual on the climate watchlist.
- They could overly politicize their social media content, such as being highly critical of the president.
- They could use figures of speech that may be misinterpreted as threats.
- They might praise the goals of a climate change extremist organization that as previously resorted to violence, even if they don’t condone the actual means.
Preppers and environmental activists must do everything in their power to protect their privacy. Failing to do so could cost them their reputation, future career opportunities or even their freedom. Here are some ways that they are contacting themselves.
Living Off the Grid and Only Venturing to Civilization for Online Use
The more digital footprints you leave behind, the greater attention you draw. People that hold controversial views on environmentalism or doomsday prepping must minimize their digital paper trail.
Living off the grid is probably the best way to protect your privacy. You can make occasional trips to town to use the Wi-Fi and stock up on supplies.
Know the Surveillance Policies of Public Wi-Fi Providers
Using Wi-Fi away from your home can be a good way to protect your privacy.However, choosing the right public Wi-Fi providers is going to be very important.
Keep in mind that some corporate coffee shops such a Starbucks can store tapes for up to 60 days. Mom and pop businesses don’t have the technology nor the interest to store them that long. They generally store tips for only 24 hours and delete them afterwards. This gives you a good window of opportunity to post your thoughts on climate change without being detected.
Always use a VPN with a No Logging Policy
Using a VPN is one of the best ways to protect your online privacy. However, some of these providers do a much better job than others. What is a VPN and what should you look for when choosing one? Here are some things to look for when making a selection:
- Make sure they are based in a country that has strict laws on protecting user privacy. VPNs that are based out of Switzerland, Panama for the British Virgin Islands are always good bets.
- Look for VPN that has a strict no logging policy. Some VPNs will actually track the websites that you visit, which almost entirely defeats the purpose. Most obviously much better than this, but many also track Your connections and logging data. You want to use a VPN that doesn’t keep any logs at all.
- Try to choose a VPN that has an Internet kill switch. This means that all content will stop serving if your VPN connection drops, which prevents your personal data from leaking out of the VPN tunnel.
You will be much safer if you use a high-quality VPN consistently, especially if you have controversial views on climate related issues or doomsday prepping.