In fact, just how much sustainability bang do you get for your buck?
Are you aware of how much influence your money can make?
‘Sure. I know that if I buy the right things in the right shots I can make a difference, by encouraging sustainable supply and minimal packaging.’
That is the collective power of consumers at work. And it’s great…as far as it goes.
But have you thought about the real difference your money can make?
I’m not talking about your day-to-day, week-to-week, month-to-month purchases.
I’m talking about your big money:
- your banking
- your superannuation or retirement funds
- your investments
These are the areas where your big money is, and where you can make a much bigger and more direct influence on how sustainably business operates.
When your money is in the bank, the bank lends it to other people and businesses…but do you know to whom your bank lends your money?
Do you know if your bank is providing funds to projects that will damage the environment, directly and/or indirectly (eg projects that promote use of fossil fuels)?
Did you know, for example, that over the last 5 years, major Australian, Asian, British and other banks have loaned $22 billion to coal ports and liquefied natural gas plants along Australia’s Eastern seaboard…and there is a big push to massively expand those coal and gas exports over the next 10 years…which will put the local environments, farmland, water, health, and the climate at risk of irreparable damage. You can find out more here.
But…you have the power to change this.
Just like with your purchases, your actions add up.
- write to your bank about your concerns and asking them to not fund exploitation of fossil fuels and other destructive businesses. BankTrack may be helpful. If you have an account with any of the big 4 Australian banks, you can easily write via MarketForces
- switch your banking to a socially responsible financial institution.
Your superannuation or retirement fund
Your superannuation or retirement fund invests your money, generating the returns that will fund your retirement…but at what cost?
Do you know where your superannuation or retirement fund invests your money?
Just like most banks, it is highly likely that your superannuation or retirement fund invests your money in businesses that destroy the environment.
And living in an unpleasant environment is no fun…how do you relax during extreme weather?
So, why do these funds invest in ‘dirty’ industries?
It’s because they have been ‘profitable’.
But, while shares in fossil fuel companies may have been profitable, it is because neither the suppliers nor the consumer are paying for the damage that the fossil fuels cause to the environment and people’s health. This means that those profits are the result of a grossly distorted market…and may not be profits at all.
And this calls into question whether the superannuation or retirement funds are making the best choices in order to maximise returns to current and future retirees, as they are required to do.
As with your banking, you can:
- write to your fund about your concerns, asking them about their investment policies and exactly where their investments are, and asking them to focus on sustainable investments. (Hint: ask them for the investments as at the end of a financial year – they have to gather this information anyway, so it should not be a bit deal to report it to you ;)). MarketForces has a good survey on which you can base your questions. If you are a member of an Australian superannuation fund, you can get help with writing here – they are required by law to provide the information you seek.
- switch your superannuation or retirement fund to one that does not fund exploitation of fossil fuels and other destructive businesses. Many funds will have a ‘sustainable’, ‘green’ or ‘ethical’ investment option
When you make investments, you can look for how sustainable the investment is in the long-term, including it’s environmental and social sustainability…and then make your investments accordingly.
And it’s important that you make the decision about where to invest your money. That way you will be more sure about where your investments lie – especially if you live in Australia because, unlike the rest of the world, Australian fund managers are not required to regularly disclose their stock portfolios.
I appreciate that this could be a big job, so how do I do it?
- I looked at the investments made by the main ‘ethical’ investment funds in my country
- From that list, I selected stocks that I thought might meet my selection criteria
- I then investigated those stocks further to whittle the list down to my ‘watch list’
- I research and monitor my ‘watch list’ in detail (mainly from a financial perspective to work out what and when to buy), (It’s early days yet ;))
I hope that I have inspired you to use your money to make a big difference to the sustainability of our world…and your future!
Changing how you handle your money is YOUR BIGGEST OPPORTUNITY to make a real difference to living sustainably. It’s one of the reasons that last week I told you about Bill McKibben’s tour downunder.
And if you need further inspiration:
- this article in Forbes succinctly summarises the investor issues
- this article in The Monthly summarises the bigger picture, with particular reference to Australian fossil fuel development
Post your actions and results in the Reply box below…or send me a voice message by clicking on the tab on the right.
Till next time…be gentle to yourself and our world!