Good With Money is running an alternative advent this Christmas, where we feature one expert, talking about how to invest to meet one of the UN SDGs, every day til Santa arrives. Today, Romi Savova, CEO of PensionBee, looks at investing for Climate Action.
Climate change is now affecting all parts of the world. This century we are expecting the average temperature globally to rise by 3 degrees. Weather patterns will become more extreme and unpredictable.
With the Paris Agreement and other initiatives happening across countries and continents to tackle climate change, most governments are taking action.
In the end it’s a numbers game: the more money invested in eco-friendly companies, the more all other businesses will change their behaviour and introduce carbon neutral initiatives.
However, there is also a way individuals can drive change: carbon-neutral investing.
Green investing has been around for a while but all too often it has gained a bad reputation with regards to costs and performance. In the end, investments such as a pension need to give you a decent return to fund your retirement.
Many financial brands will now offer you a green ISA, savings account or pension. Pioneer Triodos Bank was the first, but recently mainstream brands such as Legal & General have begun to offer investment products that offers consumers the opportunity to invest responsibly without hefty fees. They tend to perform equally well compared to their “dirty” counterparts.
With pension freedoms in the UK you can decide which pension provider you want to use, moving all your old standard pensions from previous jobs into an eco-friendly one. A good example is the PensionBee Future World Plan, a pension that invests your pension savings in companies that are generating revenue through low-carbon activities. When we introduced it in October this year it quickly became our second most popular plan.
As individuals there are so many ways we can make changes today without waiting for our governments to take action. In the end it’s a numbers game: the more money invested in eco-friendly companies, the more all other businesses will change their behaviour and introduce carbon neutral initiatives.
All done by you making a meaningful change in your personal finances.