Green cash - Friends of the Earth Scotland

Green cash

Money talks: make yours send an environmental message. Thanks to the increasing range of ethical and green financial services available it’s easier than ever make a positive impact with both investments and borrowing.

There are various different ways in which green investments function. Some simply exclude the worst companies, while others only invest in organisations which are judged to be environmentally-friendly. In the past investing ethically meant losing out on returns over conventional investments - happily this now seems to be changing. Here’s a simple introduction to the various options available in the growing world of green money.

Current Accounts

Although a current account is the one financial service it is now just about impossible to avoid, there isn’t a big selection of ethical ones. The only real contender here is the Co-operative Bank - or its online offshoot, Smile. Although the Co-op only has a single branch in Scotland, all services can be accessed over the phone or via local post offices.

“We have been aware of the growing influence of ethics in consumer choice since we launched our ethical policy 15 years ago, and it has now become more mainstream” said Catherine Turner of the Co-operative Bank.

If a local branch is required, Nationwide is probably the next best bet. They have branches in Scotland, and as a building society only lend to people buying houses, so avoiding investments in unethical companies.

Savings

With a non-ethical account it is possible that your savings will be invested in anything from weapons manufacturing to oil companies. Luckily there are alternatives.

One of the best-known ethical savings banks is Triodos. They only invest in companies or projects that are judged to have a positive effect on our environment or society. A Co-op savings account is also worth considering, although not as strictly ethical as Triodos.

“Increasingly people realise the effectiveness of their money as a tool for positive change, from buying fairtrade to choosing green electricity”, said David Cousland, Triodos Bank’s Manager for Scotland. “Now we’re seeing more and more individuals saving ethically as well, harnessing the power of their money to benefit people and the planet.”

Mortgages

Green mortgages are still in their infancy, with only a few providers such as the Ecology Building Society providing such services. However, many large lenders have a green mortgage option in the pipeline. These can work in various ways, such as donations to charity, or by incentives to improve a home’s energy efficiency.

Investment funds

Investment funds are the current shining diamond in the crown of ethical investment. They’re really starting to take on conventional funds in terms of performance, which is great news. Two highly rated ethical funds are F&C’s Stewardship range, and the Jupiter Ecology fund.

Emma Howard Boyd, of Jupiter: “Since the publication of the Stern report we’ve seen a significant take-up of our Ecology fund, which we started 19 years ago. We avoid unethical companies, and focus on firms we feel are making a positive contribution. The last three years has seen a 102% increase in the size of the fund.”

Financial Advisors

If all the choices seem a bit overwhelming there is a growing number of ethical Independent Financial Advisors that specialise in guiding you through the world of green cash. Ethical Futures are an Edinburgh based firm that can provide extensive advice about green investments.

“We continue to see a steady increase in clients interested in investing ethically. We’re glad to see that more people are realising that they can make their money change their world. This trend is mirrored nationwide and there are now over 90 ethical investment funds available to the public, and in excess of £6.1 billion is invested ethically in the UK,” said Julian Parrott of Ethical Futures.

The Ethical Investment Co-Operative, which operates a network of offices around the UK, also offers ethical advice. “Environmental and social awareness is generally increasing in all aspects of everyday life. This increase in awareness is also filtering through to investors’ wishes, to structure their investments and finances in a way
which is sympathetic to their beliefs,” said Ian Harland of EIC.

Co-operative Bank www.cooperativebank.co.uk
Jupiter www.jupiteronline.co.uk
F&C www.fandc.com
Ethical Futures www.ethicalfutures.co.uk
EIC www.ethicalmoney.org
Ecology Building Society www.ecologybuildingsociety.co.uk

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