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Good Money Week: What’s on financial advice experts minds?



Lisa Stonestreet UKSIF’s Good Money Week Programme Director told Blue & Green: “There are advisers, such as those in the Ethical Investment Association (EIA), who have a long established track record of working with their clients to make sure financial objectives and values can be aligned.” This is what some of the EIA’s leading thinkers told us.

Julian Parrot of Ethical Futures said: “After a number of years of upheaval and change in the ethical sector, 2015 was a year of consolidation and restructuring. Leading the way, the Sustainable Futures team, confident in their new home at Alliance Trust, reacted positively to market dynamics by creation of a range of risk rated multi-asset funds.

“Elsewhere, we have seen a successful rebrand at EdenTree and RLAM have finally got ‘the paperwork’ sorted to bring the old CIS Sustainability funds under one roof and made tentative steps to market them.  Following the divorce between Friends Life and F&C, we have also heard positive words from both camps looking to breathe new life into established funds. Finally, whilst funds are the usual focus, it was encouraging to see the Parmenion ethical portfolios featuring in the shortlist for the Moneyfacts ILP Awards.

“Hope springs eternal for a range of new funds and a surge in demand – but I feel this will not materialise without growth in retail distribution, therefore my wish for next is simply that the marketing teams get behind the promotions of quality funds that have in many cases outshone their mainstream peers in recent year. Likewise, I call on my fellow IFA’s to recognise the nascent demand amongst their clients or even just to consider a particular ethical or sustainable fund as a useful portfolio diversifier.”

Lee Coates OBE of Ethical Investors said: “Good Money week is a crucial element in the growth of responsible investment, but it has to contend with ingrained barriers in the financial services industry.  These barriers are two-fold: Lack of Regulatory guidance – whilst the Regulator requires advisers to take note of a client’s Attitude to Risk (AtR) before giving advice (and avoid this area at their peril) there is no such guidance on ascertaining a client’s attitude to the impact of their investments.

“By impact I am referring to the social, environmental and sustainable impact of placing their money in Fund A or Fund B.  For those who would be given the choice, investing responsibly is just as important as their AtR. The lack of direction from the Regulator thereby leads to the second barrier.

“Poor financial advice – advisers have a requirement to consider a client’s AtR, needs and objectives when giving advice – the Know Your Client requirements.  However, it really is up to the adviser to decide what they want to know and anything, such as responsible investment, that might get in the way of a sale is clearly not needed!  If advisers were doing their job properly they would automatically need to know if each client had any social, religious, environmental or other aspect of their life which should be incorporated into the advice process.

“It is true (and sad) that many people will not apply any values at all other than profit to their investments but by asking the question of all clients a good adviser can do their job properly.  By choosing not to ask the question an adviser is making decisions on behalf of a client that are not theirs to make.“

Lisa Hardman of Investing Ethically said: “It seems as if more attention is being paid to SRI at a high level such as “Zurich pledges to focus 10 per cent of investments on delivering ‘positive impact’ ” and an increasing number of companies are taking individual action on a range of sustainability issues, however, this is not translating into more funds for retail investors.

“The range of funds has not significantly changed over the last couple of years although we understand from a number of the fund managers already offering ethically screened funds that some potentially new ethically screened funds are being consulted on so we hope the overall range of funds will increase over the next few years. We are not presently seeing new fund managers coming to the table to offer ethically screened funds.

“The main ethical issues our clients focus on are currently: The arms trade and tobacco, fossil fuels and wanting to invest positively. Just avoiding ‘bad’ stuff is not enough. We are getting more questions about crowdfunding and supporting social enterprise and local business.”

John Ditchfield of Barchester Green said: ““My view is that 2016 is likely to be a big year for responsible investment as the movement to divest from fossil fuels continues to win support from major trusts, foundations and other corporate investors. We also think private investors are finally getting the message that responsible investments can performance very well and that will lead to more activity from individuals investing their savings and/or moving to responsible funds.

“Looking at our own business the merger of Barchester, Castlefield and GAEIA is exciting news because this will create a really substantial and sustainable advice service with the right structure and vision to grow into the mainstream; the group assets under advice will be around £430M”.

Tanya Pein of IN2 Consulting said: “All pension money belongs to individual members and they care deeply about these issues. Responsible investment (RI) is mainstream: retail investors hear warnings about the financial risk of climate change from the Bank of England et al, and they regularly ask about it.

“Retail investors place their trust their fund managers to act on bad practice of all kinds – and increasingly they want specific information about what engagement is going on; not just reassurance. There are expert RI advisers out there – look them up on the EIA website. There is more demand for RI advice than there are advisers to meet it, so it’s smart for all advisers across the UK to use the Good Money Week resources and learn more.

Independent SRI Consultant John Fleetwood of 3D Investing added: “I’d like to see more funds following WHEB and Impax’s lead by issuing impact reports.  Given that many investors base investment decisions on social impacts as well as financial returns, measuring impact can be just as important as monitoring financial performance.

“I’d also encourage fund managers to publish all of their holdings with a brief description of the nature of the business activity.  It’s actually remarkable how difficult it can be to get the full report and accounts from some funds.

“The short form report is widely available but this only lists the top 10 holdings.  In some instances fund managers insist on sending paper copies running to several hundreds of pages which is absolutely crackers.  Come on guys, at the very least it must be easy to publish a pdf on your web site.”

UKSIF’s Stonestreet again: “Good Money Week is an excellent opportunity for advisers [such as those above] to highlight their expertise and for those who may less experienced in this particular area to learn more about how best to meet their clients’ needs in an evolving and growing market.”

“As increasing numbers of investors look to combine their environmental and social concerns with their financial decisions it’s never been more important for advisers to be aware of how to accurately reflect this in their approach to financial planning.”

Editors Choice

2017 Was the Most Expensive Year Ever for U.S. Natural Disaster Damage



Natural Disaster Damage
Shutterstock / By Droidworker |

Devastating natural disasters dominated last year’s headlines and made many wonder how the affected areas could ever recover. According to data from the U.S. National Oceanic and Atmospheric Administration (NOAA), the storms and other weather events that caused the destruction were extremely costly.

Specifically, the natural disasters recorded last year caused so much damage that the associated losses made 2017 the most expensive year on record in the 38-year history of keeping such data. The following are several reasons that 2017 made headlines for this notorious distinction.

Over a Dozen Events With Losses Totalling More Than $1 Billion Each

The NOAA reports that in total, the recorded losses equaled $306 billion, which is $90 billion more than the amount associated with 2005, the previous record holder. One of the primary reasons the dollar amount climbed so high last year is that 16 individual events cost more than $1 billion each.

Global Warming Contributed to Hurricane Harvey

Hurricane Harvey, one of two Category-4 hurricanes that made landfall in 2017, was a particularly expensive natural disaster. Nearly 800,000 people needed assistance after the storm. Hurricane Harvey alone cost $125 billion, with some estimates even higher than that. So far, the only hurricane more expensive than Harvey was Katrina.

Before Hurricane Harvey hit, scientists speculated climate change could make it worse. They discussed how rising ocean temperatures make hurricanes more intense, and warmer atmospheres have higher amounts of water vapor, causing larger rainfall totals.

Since then, a new study published in “Environmental Research Letters” confirmed climate change was indeed a factor that gave Hurricane Harvey more power. It found environmental conditions associated with global warming made the storm more severe and increase the likelihood of similar events.

That same study also compared today’s storms with ones from 1900. It found that compared to those earlier weather phenomena, Hurricane Harvey’s rainfall was 15 percent more intense and three times as likely to happen now versus in 1900.

Warming oceans are one of the contributing factors. Specifically, the ocean’s surface temperature associated with the region where Hurricane Harvey quickly transformed from a tropical storm into a Category 4 hurricane has become about 1 degree Fahrenheit warmer over the past few decades.

Michael Mann, a climatologist from Penn State University, believes that due to a relationship known as the Clausius-Clapeyron equation, there was about 3-5 percent more moisture in the air, which caused more rain. To complicate matters even more, global warming made sea levels rise by more than 6 inches in the Houston area over the past few decades. Mann also believes global warming caused the stationery summer weather patterns that made Hurricane Harvey stop moving and saturate the area with rain. Mann clarifies although global warming didn’t cause Hurricane Harvey as a whole, it exacerbated several factors of the storm.

Also, statistics collected by the Environmental Protection Agency (EPA) from 1901-2015 found the precipitation levels in the contiguous 48 states had gone up by 0.17 inches per decade. The EPA notes the increase is expected because rainfall totals tend to go up as the Earth’s surface temperatures rise and additional evaporation occurs.

The EPA’s measurements about surface temperature indicate for the same timespan mentioned above for precipitation, the temperatures have gotten 0.14 Fahrenheit hotter per decade. Also, although the global surface temperature went up by 0.15 Fahrenheit during the same period, the temperature rise has been faster in the United States compared to the rest of the world since the 1970s.

Severe Storms Cause a Loss of Productivity

Many people don’t immediately think of one important factor when discussing the aftermath of natural disasters: the adverse impact on productivity. Businesses and members of the workforce in Houston, Miami and other cities hit by Hurricanes Harvey and Irma suffered losses that may total between $150-200 billion when both damage and sacrificed productivity are accounted for, according to estimates from Moody’s Analytics.

Some workers who decide to leave their homes before storms arrive delay returning after the immediate danger has passed. As a result of their absences, a labor-force shortage may occur. News sources posted stories highlighting that the Houston area might not have enough construction workers to handle necessary rebuilding efforts after Hurricane Harvey.

It’s not hard to imagine the impact heavy storms could have on business operations. However, companies that offer goods to help people prepare for hurricanes and similar disasters often find the market wants what they provide. While watching the paths of current storms, people tend to recall storms that took place years ago and see them as reminders to get prepared for what could happen.

Longer and More Disastrous Wildfires Require More Resources to Fight

The wildfires that ripped through millions of acres in the western region of the United States this year also made substantial contributions to the 2017 disaster-related expenses. The U.S. Forest Service, which is within the U.S. Department of Agriculture, reported 2017 as its costliest year ever and saw total expenditures exceeding $2 billion.

The agency anticipates the costs will grow, especially when they take past data into account. In 1995, the U.S. Forest Service spent 16 percent of its annual budget for wildfire-fighting costs, but in 2015, the amount ballooned to 52 percent. The sheer number of wildfires last year didn’t help matters either. Between January 1 and November 24 last year, 54,858 fires broke out.

2017: Among the Three Hottest Years Recorded

People cause the majority of wildfires, but climate change acts as another notable contributor. In addition to affecting hurricane intensity, rising temperatures help fires spread and make them harder to extinguish.

Data collected by the National Interagency Fire Center and published by the EPA highlighted a correlation between the largest wildfires and the warmest years on record. The extent of damage caused by wildfires has gotten worse since the 1980s, but became particularly severe starting in 2000 during a period characterized by some of the warmest years the U.S. ever recorded.

Things haven’t changed for the better, either. In mid-December of 2017, the World Meteorological Organization released a statement announcing the year would likely end as one of the three warmest years ever recorded. A notable finding since the group looks at global land and ocean temperature, not just statistics associated with the United States.

Not all the most financially impactful weather events in 2017 were hurricanes and wildfires. Some of the other issues that cost over $1 billion included a hailstorm in Colorado, tornados in several regions of the U.S. and substantial flooding throughout Missouri and Arkansas.

Although numerous factors gave these natural disasters momentum, scientists know climate change was a defining force — a reality that should worry just about everyone.

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How to be More eco-Responsible in 2018



Shutterstock / By KENG MERRY Paper Art |

Nowadays, more and more people are talking about being more eco-responsible. There is a constant growth of information regarding the importance of being aware of ecological issues and the methods of using eco-friendly necessities on daily basis.

Have you been considering becoming more eco-responsible after the New Year? If so, here are some useful tips that could help you make the difference in the following year:

1. Energy – produce it, save it

If you’re building a house or planning to expand your living space, think before deciding on the final square footage. Maybe you don’t really need that much space. Unnecessary square footage will force you to spend more building materials, but it will also result in having to use extra heating, air-conditioning, and electricity in it.

It’s even better if you seek professional help to reduce energy consumption. An energy audit can provide you some great piece of advice on how to save on your energy bills.

While buying appliances such as a refrigerator or a dishwasher, make sure they have “Energy Star” label on, as it means they are energy-efficient.

energy efficient

Shutterstock Licensed Photo – By My Life Graphic

Regarding the production of energy, you can power your home with renewable energy. The most common way is to install rooftop solar panels. They can be used for producing electricity, as well as heat for the house. If powering the whole home is a big step for you, try with solar oven then – they trap the sunlight in order to heat food! Solar air conditioning is another interesting thing to try out – instead of providing you with heat, it cools your house!

2. Don’t be just another tourist

Think about the environment, as well your own enjoyment – try not to travel too far, as most forms of transport contribute to the climate change. Choose the most environmentally friendly means of transport that you can, as well as environmentally friendly accommodation. If you can go to a destination that is being recommended as an eco-travel destination – even better! Interesting countries such as Zambia, Vietnam or Nicaragua are among these destinations that are famous for its sustainability efforts.

3. Let your beauty be also eco-friendly


Shutterstock / By Khakimullin Aleksandr

We all want to look beautiful. Unfortunately, sometimes (or very often) it comes with a price. Cruelty-free cosmetics are making its way on the world market but be careful with the labels – just because it says a product hasn’t been tested on animals, it doesn’t  mean that some of the product’s ingredients haven’t been tested on some poor animal.

To be sure which companies definitely stay away from the cruel testing on animals, check PETA Bunny list of cosmetic companies just to make sure which ones are truly and completely cruelty-free.

It’s also important if a brand uses toxic ingredients. Brands such as Tata Harper Skincare or Dr Bronner’s use only organic ingredients and biodegradable packaging, as well as being cruelty-free. Of course, this list is longer, so you’ll have to do some online research.

4. Know thy recycling

People often make mistakes while wanting to do something good for the environment. For example, plastic grocery bags, take-out containers, paper coffee cups and shredded paper cannot be recycled in your curb for many reasons, so don’t throw them into recycling bins. The same applies to pizza boxes, household glass, ceramics, and pottery – whether they are contaminated by grease or difficult to recycle, they just can’t go through the usual recycling process.

People usually forget to do is to rinse plastic and metal containers – they always have some residue, so be thorough. Also, bottle caps are allowed, too, so don’t separate them from the bottles. However, yard waste isn’t recyclable, so any yard waste or junk you are unsure of – just contact rubbish removal services instead of piling it up in public containers or in your own yard.

5. Fashion can be both eco-friendly and cool

Believe it or not, there are actually places where you can buy clothes that are eco-friendly, sustainable, as well as ethical. And they look cool, too! Companies like Everlane are very transparent about where their clothes are manufactured and how the price is set. PACT is another great company that uses non-GMO, organic cotton and non-toxic dyes for their clothing, while simultaneously using renewable energy factories. Soko is a company that uses natural and recycled materials in making their clothes and jewelry.

All in all

The truth is – being eco-responsible can be done in many ways. There are tons of small things we could change when it comes to our habits that would make a positive influence on the environment. The point is to start doing research on things that can be done by every person and it can start with the only thing that person has the control of – their own household.

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