News

National Ethical Investment Week closes for another year

As the curtain falls on NEIW 2011 we ask our readers, “Do you ever consider the impact your savings or investments have on society or the environment and why?”

Published

on

As the curtain falls on NEIW 2011, Charlotte Reid asks our readers, “Do you ever consider the impact your savings or investments have on society or the environment and why?”

Washing clothes at cooler temperatures, fitting energy-saving light bulbs and turning the thermostat down a notch are just three responses people have when attempting to live a more environmentally-friendly or sustainable lifestyle. One area that tends to be neglected is where people’s savings and investments are tied up.

Like many people, Lee Myers (a marine surveyor), doesn’t immediately recognise the impact his savings have on the environment, “I don’t think of penguins suffering as a result of the money I have in the bank.” He isn’t alone in not making the connection or thinking it’s not just individuals who will make a difference.

One reader commented on the influence that businesses have. They felt the actions of big business outweigh any investment decisions they made for “purely personal ‘philanthropic’ interventions.” While they recognised it would be good for everyone to recycle, reuse and reduce more, they felt it is more important to get businesses to change their approach.

According to the Monitor Institute, a group of companies that help organisations figure out how to be more environmentally aware, people are finding environmental investments attractive so that they can move away from ‘harmful’ companies and in turn encourage those companies to be environmental and ethical.

One argument pushed by sections of the media that puts people off investing ethically is they think that the financial return could be lower than an ‘ordinary’ fund could offer.

Advertisement

Steve Cook, a college principal, explains that he does think about ethically-friendly savings but admits that his “first thought on any saving or investment is the return I’m likely to get, so the impact on society or the environment is very much a secondary thought.”

To counter that a survey released in 2008 by the Cooperative Insurance (CIS) revealed that almost eight out of 10 people believe that ethical funds can perform just as well as mainstream funds.
However, even the greenest and most environmentally aware people can encounter practical problems with investing ethically.

Diana Catton, who works at a technology firm, says “I like to think that over the years I have had a small footprint” as she gives unwanted items to Freecycle and has put a brick in toilet cistern of every shared house she has lived in, to save water, amongst other things.

However, she says that savings and investments are hard because “most banks have something to hide” and her biggest investment, her pension, she felt like she had no choice about as it is with her employer’s pension fund.

Advertisement

Likewise, Paul Daubney, who works in property development, says, “I do consider carefully where my money is invested … I’m very up to date with ethical investment … It’s an important issue for me although I admit it is an absolute minefield.”

The UK Sustainable Investment Forum heard in 2010 that 49% of investors say that they want to make money whilst doing good for the environment. Despite Cook’s understandable focus on return, he is already engaged with ethical savings, and believes that as more big businesses consider the impact of their own investments people will start to as well, “There is big scope for companies to proactively use their positive ethical values to influence people’s decisions to invest in them. I certainly wouldn’t want to invest in a company which had a poor ethical reputation.”

Any investment decision is important and the financial services industry does not have a great record at making products simple to understand.  But help is at hand. If you are interested in investing ethically, you should seek professional financial advice. Phone your IFA, if you have one, and tell them about your ethical requirements or fill in our online form and we will put you in touch with one of our expert panel of specialist financial advisers.

Advertisement

Trending

Exit mobile version