Being right is a great feeling, isn’t it?
But being made to feel wrong? Pretty rubbish.
I am bringing this up because I recently approached a company that I won’t name but is the manufacturer of an ultra right-on product, about running a promotion together.
The marketing person liked our idea but couldn’t agree because the company had various principled objections to their product being given away for free. Even if it earned them a load of publicity and brought information about their product to an audience that might not otherwise know about it.
I was taken aback. Coming from a personal view that anything that gets more people more into saving and spending in a responsible way is a good thing, this did not seem like a good way to disrupt markets and spread the message.
How can you make anything a mass market proposition if you keep it out of reach to all but the wealthiest?
Being able to do the right thing shouldn’t be an exclusive club that people have to buy into. Many of the most interesting Environmental and Social Governance funds still require initial outlays of £10,000 before someone gets a look in. That’s me out then.
But platforms such as Abundance, which enables investing in renewable energy through Innovative Finance ISAs, are very deliberately opening up responsible investing to the masses with a £5 minimum investment.
In practice, very few people put so little in, but the point is they can if they want to. Being down to your last spare fiver doesn’t make you an immoral thicko, and more ethical providers would do well to cater for this market. As Julia Groves, former chair of the UK Crowdfunding Association and now head of crowdfunding at Downing, a rather old school asset manager that’s recognising the value in broadening its proposition to be more inclusive, says: “wealth is not a skill set”.
But the second point is, who are any of us to consider anyone else not ethical enough?
Very few people would consider themselves overtly NOT ethical. Everyone, to a greater or lesser extent, feels they are trying. So to deny people options because they don’t have enough money forces them into a position they don’t want to be in. Effectively, the position of buying the essentials range instead of the free range, organic, when there is no particular reason, from a cost point of view, why they shouldn’t have the latter.
The very mention of the word ethical in relation to finance has become alienating – and this is ultimately self-defeating for an industry that should be front and centre, not at the sidelines.
It’s a potential image problem we are all too aware of over at Good With Money and we try to get over the strong likelihood that we might come across as sanctimonious and privileged in small ways all the time, by, for example, confessing the areas of our own personal finances that aren’t as good as they could be. We also try to highlight the difficulties faced by everyone trying to be more ethical, as well as by those in the industry who try to reconcile the motivations of profit and principle, often while being laughed at for what others perceive as their naievity. Because in finance especially, the view is often that there isn’t room for both in a portfolio.
There is PLENTY of evidence that this is changing at last (the old “profit is king” guard of Terry Smith et al. have gone noticeably quiet on this topic lately) – but what needs to change alongside this more grown-up attitude to this idea of being able to make a profit, without harming the planet or other people, is that those of us who care about doing the right thing with our cash are a rarefied bunch, sitting on our pedestals and throwing down the odd crumb of useless information to the poor, value-driven proles.
Society is catching on – we’ve read plenty recently about compassionate conservatism and the Power Paradox, the newly released book by Dacher Keltner that explains that the days of Machiavelli are over and true power is about helping others and being kind. We are genuinely all in all of it together.
We just need our financial services providers to follow suit en masse. Some have always been good at this: Charity Bank, Ecology Building Society and Triodos, for example. They all have products that even modest savers can access. More generally, building societies rather than banks tend to be more people-focused and offer accounts that are available to all. The new wave of fintech start-ups tend to prioritise the convenience and service they offer new customers over ethical propositions, but most that we have spoken to (with the disappointing exception of Nutmeg) are planning to offer them in later phases of their development, which will further open up the privilege of ethics to a more than moral crowd of wannabe do-gooders (interestingly, millennials, that group of under 35s so badly catered for currently by the savings and investments industry, are firmly in this camp). Existing asset managers and investment platforms need to stop just marketing themselves to the wealthy over 55s and start working out how they are going to attract the younger, more principled but less well-endowed investor.
As one of our experts, Julia Dreblow, of Fund Eco Market, puts it, we don’t want to be “angels dancing on the head of a pin”. So this is a plea to other ethical providers, whether that’s of retail or financial products, to consider how wide open your doors are currently, and see if you can push then open a bit further still.
Sanctimony – it is SO not a good look.