Top 10 sustainable investment platforms

Written by Christine Dawson on 9th May 2019

Ever thought of investing ethically or sustainably but didn’t know how or where to do it? Well, the good news is that it’s not as difficult as you may have thought. As in so many areas of modern life, these days you need only hop online to find a platform through which you can easily open an account and get started today.

Through these platforms you can invest in funds or projects that pool investors’ money together to put into companies and organisations contributing to our sustainable future. For example, Greencoat Wind uses investor money to help fund wind farms, while the Allianz Green Bond fund lends money to companies specifically for green or climate-focussed projects and improvements.

For your complete guide to the best ethical and sustainable investment funds available to UK investors, see the latest Good Investment Review, produced in collaboration with 3d Investing

Which platform you choose will depend on a number of factors, including how much money you have to invest and what you want to invest in. Below we profile the top ten investment platforms for ethical and sustainable investment.

Abundance

Investments: Direct loans to projects and businesses, secondary market
Annual fee: None

Good Egg company Abundance is a niche platform focusing on peer-to-peer lending for sustainable projects. You can use it to make loans to green and social infrastructure projects. Each one varies when it comes to minimum investment required, but start at £5. The returns you can expect vary a fair bit too.

Typically, returns on crowdfunding sites like Abundance are higher than on a traditional investment platforms but that comes with higher risk such as the infrastructure project or business struggling or failing.

The platform allows you to trade some of the loans (known as debentures) with other Abundance investors which is good for diversification. It also has a tax-efficient Innovative Finance ISA option. For more details see the Good With Money Guide to the IFISA

AJ Bell YouInvest

Investments: Investment funds, company shares, trusts, exchange traded funds (ETFs), bonds
Annual fee: 0.25%

AJ Bell YouInvest is a great place to start with investment platforms; although it is set up for a confident investor, it is easy to navigate and has nice guides and articles. Importantly, it is one of the more competitively priced platforms too.

Within its large range of funds you’ll find a good selection of sustainable options. But as with many traditional investment platforms it does not have any search function that will narrow it down to ‘sustainable options only’ so you’ll need to know the name of what you are looking for. And a downside on the fund info pages is it only show the top five companies a fund is invested in, where many platforms show the top ten.

Good With Money found a range of 54 sustainable funds on Fund EcoMarket, all available through an ISA, and asked each traditional platform how many of those they offered. AJ Bell offered 42 out of 54 of our sustainable fund selection.

Barclays Smart Investor

Investments: Investment funds, company shares, trusts, ETFs, bonds
Annual fee: 0.2%

You know the name, but did you know the bank also has an investment platform? It’s annual fee of 0.2 per cent is for funds. A caveat to this low fee is other investment types like stocks and bonds incur an additional 1 per cent platform charge. It is not the easiest of sites to navigate and does feel like it is somewhat tacked on to all the rest of the bank’s offerings.

However, it can boast a whole section on impact investing where you can read more about how to make sustainable investments. Alongside the explainers are lists of impact funds and impact ETFs under different themes such as ‘social’ and ‘environmental’.

Barclays Smart Investor offers 43 out of 54 of our sustainable fund selection.

BestInvest

Investments: Company shares, investment funds, trusts, ETFs
Annual fee: 0.4%

BestInvest is a stalwart of the investing space and has its own team of financial advisers should the DIY option become untenable for you. The annual price of the platform is a bit pricer than other low cost options at 0.4 per cent, unless you have over £250,000 to invest at which point the cost comes down to 0.2 per cent.

The platform does feel like it is geared towards a more seasoned investor and it is not big on information around sustainable investing. That said, it is well worth checking out BestInvest’s long-standing guide to underperforming funds: Spot the Dog.

BestInvest offers 31 out of 54 of our sustainable fund selection.

Charles Stanley Direct

Investments: Company shares, investment funds, trusts, ETFs, bonds
Annual fee: 0.35%

Charles Stanley is another traditional investment platform, however it happens to have a better-than-average selection of sustainable funds available on it. It is not as friendly a website for the beginner investor as some of the other platforms on this list, but displaying the top ten holdings for each fund in a colourful chart is a plus.

Like most platforms offering a wide range of investment options, Charles Stanley also offers model portfolios of pre-selected funds, known as the Foundation Portfolios, which will have a diverse basket of investments in them. The platform does not yet offer a sustainable option, however.

Charles Stanley offers 50 out of 54 of our sustainable fund selection.

Ethex

Investments: Direct equity (eg shares in social enterprises), bonds, funds, secondary equity market
Annual fee: None

Ethex is an innovator in the platform space and is designed specifically for people wanting to do good with their money. It offers crowdfunding and peer-to-peer lending, which means you can invest directly in projects such as affordable housing.

Like Abundance, Ethex allows you to invest in peer-to-peer loans through a tax efficient Innovative Finance ISA, which you can open on the website as you invest. Ethex also offers some funds through its platform: sustainable funds only of course! Minimum investment amounts vary but can be as low as £1. Ethex investors can use a marketplace to trade eligible shares and bonds with others on the platform.

Find out more in the Good Guide to Impact Investing.

Fidelity Personal Investing

Investments: Company shares, investment funds, trusts, ETFs
Annual fee: 0.35%

A global investment giant, Fidelity has over 1 million clients in the UK alone. There’s lots of content to pore over on the website but our favourite feature is the ability to search funds by the ‘socially responsible’ tag which gives over 200 results.

There is also a list of the top 10 transacted environmental, social and governance (ESG) funds. Even if you ultimately decide to use another platform to invest through, these handy features makes Fidelity a good stop for browsing and researching what’s out there.

Fidelity Personal Investing offers 44 out of 54 of our sustainable fund selection.

Hargreaves Lansdown

Investments: Company shares, investment funds, trusts, ETFs, bonds
Annual fee: 0.45%

HL, as it likes to be known, is a well-known, trusted brand and the biggest platform in the UK for personal investors. It is also one of the most expensive with an annual fee of 0.45 per cent, so be wary of how this might chip away at your returns. You can start with just £100 or £25 per month.

In the fund research section you’ll see an ‘ethical sector’ page showing one sustainable fund which has made it on to HL’s Wealth 50 list of favourite funds, alongside another seven sustainable funds ‘of interest’. HL’s explainers on sustainable investing terminology are certainly worth a read.

HL offers 47 out of 54 of our sustainable fund selection.

Interactive Investor

Investments: Company shares, investment funds, trusts, ETFs, bonds
Annual fee: 0.45% / £90 per year for an ISA

Interactive Investor stands out for its flat fees which are £22.50 per quarter for an ISA. However, this means the charges only start to make sense if you have a larger portfolio of £40,000 or more (amounts lower than this should used percentage-based providers and the cheaper the better). The site is clear and simple and recently launched the “ACE 30”

list of funds. ACE stands for “Avoids Considers Embraces”. The list of funds is separated according to asset class and investment category, which you can see in a handy table here.

Once you have made it to the investment product you were after, the lower half of the page shows a really useful comparison with similar investments.

Interactive Investor offers 46 out of 54 of our sustainable fund selection.

Wealthify

Investments: Wealthify Ethical Plan
Annual fee: 1.41%

Wealthify is what is known as a robo-adviser, which means you don’t have to do any work: you say how much risk you want to take and how much you want to invest each month and an algorithm invests it in a selection of funds for you. However, while Wealthify’s Ethical Plan is the best ethical and sustainable robo option out there, it still contains passive funds (aka index trackers) that invest in oil and gas majors, big banks etc. (though no tobacco), so bear that in mind.

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