There used to be a stark choice when it came to investing. Maximise the return on your cash or go green. Bluntly, being ethically sound would cost you money. That’s changed recently, with a huge growth in available funds. Specialist investment advisers Barchester Green says the number of ethical investments grew by a huge 600% last year, and there are very big, very established companies offering funds, Big names include Jupiter, Aegon, Schroder and Standard Life.
The first problem is, deciding what green means. There are (broadly) three different types of funds: climate change funds, environmental funds, and ethical funds. But an ethical fund may not be so good on the environment, and vice versa. You may have to question your own beliefs. You may view BP and Esso as the bad guys for producing oil, but if they’re working on the new generation of eco-friendly fuels, such as solar or wind power, then should you be investing in them as major agents in combating climate change? And how about nuclear power – do you consider it a ‘green’ alternative to fossil fuels?
There is also argument about what is green. Bio-fuels are being touted as the eco alternative to petrol, but the green lobby see them as a potential disaster. The next problem is, deciding how green is your investment. Financial advisers actually grade different funds from ‘light green’ to ‘dark green’ depending on their eco credentials.
The blunt fact is though that waste management, alternative fuels and sustainable resources are going to attract big investment in the coming years. These companies are going to grow, and that means that whatever shade of green you are, there are good (if speculative) investments to be made. You can invest direct into startup companies, but unless you’re an expert (and very brave) it always makes more sense to go for a Fund. Strong performers include Aegon Ethical Equity, which considers the environment in its buys too. Jupiter Ecology is biased towards the environment and buys worldwide, and is rated ‘dark green’. Jupiter also has the Impax Fund, which invests in the environment technology market.
Of course there are lots of IMMEDIATE ways you can be green and save money, and we’re not talking complex carbon offsetting programmes here, or credit cards that promise to plant a tree every time you make a purchase. Get rid of the disposable nappies and go back to washable. You’ll cut landfill and save hundreds of pounds a year. Turn down your central heating thermostat by 1degC, wash at 40 ºC instead of 60, and switch off all those twinkling standby gadgets. Do you often look around and find the only person in the car is you … the driver? Get together with your neighbours and set up a car share scheme. Use libraries instead of buying books.
The list goes on. All these ideas will save resources and will INSTANTLY start saving you money … possibly hundreds of pounds over a year. So ask yourself … why WOULDN’T you do them.
