RACHEL RICKARD STRAUS: It’s time to maximise our impact as investors


We do so much as consumers to minimise our impact.

We might choose to eat free range to minimise the suffering of animals, or perhaps opt for the train instead of car to reduce the emissions of a trip, or we may decline a plastic straw to help cut out needless pollution.

The response to Attenborough’s Blue Planet alone shows just how aware we are of our impact and our willingness to keep it in check.

If we needed further proof, a survey from Legal and General Investment Management last week found that 92 per cent of 18-55 year olds say minimising their impact on the environment is important.

But curiously, so often this attitude doesn’t leech over into investing – an area in which we have an incalculable impact.

Packing a punch: As investors we have the opportunity to use our cash to do good things

Packing a punch: As investors we have the opportunity to use our cash to do good things

Packing a punch: As investors we have the opportunity to use our cash to do good things

While making conscientious decisions as consumers, and getting angry at social issues as citizens, as investors we often remain unengaged. Millions of us invest every month in companies that don’t necessarily align with our values. 

We may be putting cash every month through our pensions or other savings into oil companies, arms makers or other sectors that some people are uncomfortable with, and blithely give our money to companies whether or not they treat their staff fairly, hand out unjustified bonuses to complacent bosses or own up to huge gender pay gaps.

We wield such power as investors to shape our world. As much as £63billion was invested last year in UK funds alone, according to the Investment Association. So imagine what would happen if we used our clout as a force for good.

As with other choices we make, there are ways of investing to reduce impact. There are funds, for example, that screen out any companies that invest in so-called sin stocks, often encompassing things like tobacco, arms or gambling.

We can ask questions of our pension providers – and then ask more if we don’t like the answers.

But joyfully, in investing the focus doesn’t have to be about reducing impact – it can be about maximising it.

Impact investing is gaining momentum – the idea of protecting and growing money while making a positive contribution to the world – not just not doing harm, but actually doing good.

So alongside recycling diligently, for example, you could invest in a fund that puts money into companies that making better compostable materials, or improving recycling facilities.

Or although you may have to drive, you could put money in a fund that invests in cleaner fuels or vehicles.

And we’ve only just begun. Just 15 per cent of investors have made an impact investment, according to a new survey from Barclays, but 56 per cent of investors say they are interested in exploring it further.

‘Investors own businesses; we can have much more influence than is currently understood,’ says Legal and General’s Helena Morrissey. ‘We can write our own future.’



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