As part of National Ethical Investment Week I’ve been sharing my story of being a Responsible Investor. Its been fun sharing this story with friends, colleagues as well as with the folks at BBC News and the Mail On Sunday.
I’ve been sharing my story as I believe its important that we all start talking more about our relationship to money…..and here is why.
Money is an amazing thing. Although a human created concept, it has become an elemental force of its own – it moves people, companies, markets and nations.
Money is a great mirror of society and, how we relate to it, is reflection of our worldviews, values and beliefs.
For many, many people, money is power, money is energy and money is identity. And for me, money — and how I invest my money — is totally about responsibility.
Here are two key reasons why I choose to be a Responsible Investor:
1) Responsibility as an ‘Active Investor’
As humanity, we are facing an interesting crossroads – and in effect we have two main choices – either we choose to be on the ‘inactive’ or the ‘active’ side of enabling a positive future.
Frankly, the challenges we face require us to be on the very ‘active’ side of the game. This means taking responsibility for our actions. Every thought, every word and every penny – makes a difference. It does. What if we all believed this? – together, we would be an awesome force for change.
It is no longer good enough to wait for others to save us – not the government, not business, not the media, not the law. We can no longer pretend that it does not matter if our pensions, 75% of value of the FTSE listed companies, are feeding oil, gas and extractives companies in their rapid destruction of the planet. Our precious future.
So we have a choice. I choose to invest in companies like Good Energy, Neal’s Yard and Abundance Generation. I do this through my Self Invested Personal Pension (SIPP), my online cash ISA with Triodos and my current account with Cooperative Bank. These are funds and companies that are making a positive impact on the world. They are business models that are pioneering the future. They need our backing.
2) Responsibility as a ‘Smart Investor’
I also believe that companies that are strategically building business models around the future realities of ecological limits, human well-being and equality are simply just better run companies. They are the ones who are going to thrive in the future and will provide me with healthy returns for my savings.
Take a look at Triodos and the Cooperative Bank for example. Since July, Triodos, a bank that invests only in companies that are supporting positive impact, has seen a 78% increase in enquiries for people wanting to open savings accounts. It has drawn in double the amount of money coming into its accounts compared to last year. The Co-operative Bank has seen a 43% increase in people switching to their accounts.
We have seen the demise of big business models that are out of touch with reality – especially in the banking sector. Some businesses will be able to continue to extract short-term profits, however in the medium to long-term, I believe that large organisations, (and the pension funds that invest in them), will be too slow to adapt to our rapidly changing world and the fact of ecological limits.
My view is that it will become harder and harder for big business, and pension funds, to deliver returns. We are in an intensifying ecological and social crisis-we are going to experience even more chaotic effects in the next 5, 10 20 years and beyond. And systemically, this will no doubt put markets into turmoil. So it is in our universal financial interest to invest in companies that are being prudent with our social and environmental capital upon which our future financial capital depends.
I’m in it for the long-run and I trust that the better run businesses will be the winners – not only enabling a positive future for humanity but also creating healthy and steady financial returns.
So for these two important reasons, it is common sense to me to be a responsible investor. Money matters and every choice with your investments makes a huge difference! YOU are the difference.
Here are some resources that I have found useful:
- Move Your Money – info on how and where to move your money
- Your Ethical Money – info on various types of financial products
- Fair Pensions - info on how to engage your pension fund
- Barchester Green – support on how to manage your investments
- UK Sustainable Investment and Finance – info and resources for to manage your investment savings
- Abundance Generation - an example of a new community investment model
- Good Energy - an example of a thriving business model
- Triodos Bank- an example of a thriving business model
- Kiva - an example of a peer to peer lending model