If you want your ISA to do more than just grow your money, you’re not alone.
An ethical ISA is about where your money goes – not just the returns you get. That means looking beyond tax-free wrappers and asking what your savings and investments are actually funding.
Here’s how to build a more ethical ISA, step by step.
1. Start with the everyday – your bank
Before you even get to ISAs, look at where your money sits day to day.
Banks use customer deposits to lend and invest. That means your current account and savings could be supporting fossil fuels, deforestation or arms – or helping fund renewable energy, social housing and community projects.
Good Egg firms like Triodos Bank focus their lending on organisations with clear environmental and social benefit. Building societies such as Nationwide Building Society and The Co-operative Bank also have stronger ethical policies than many high street banks.
Top 7 ethical current accounts
2. Use apps to build momentum
Small habits can make a big difference over time.
Apps like Moneybox round up spare change from everyday spending and move it into savings or investments automatically. Many now offer socially responsible or ESG-focused portfolios as standard.
It’s not just about convenience, it’s a way to consistently channel money into more positive outcomes without thinking about it.
3. Choose your cash carefully
Cash ISAs still play an important role – especially for short-term goals or emergency savings.
But while rates have improved in recent years, cash will usually struggle to beat inflation over the long term. So if you are holding cash, it’s worth making sure it’s working as hard as possible.
Look for providers such as Ecology Building Society, Triodos Bank, Charity Bank or Gatehouse Bank, which direct savings towards social and environmental projects.
Top 7 green ISAs for your climate-friendly cash
4. Consider Innovative Finance ISAs
If you want your money to have a direct, visible impact, Innovative Finance ISAs (IFISAs) are worth exploring.
Platforms such as Ethex, Energise Africa and Triodos Crowdfunding let you invest in projects like renewable energy, community businesses and social housing.
Returns can be higher than cash, but these investments are higher risk and less liquid – so they won’t be right for everyone.
5. Use platforms with ready-made ethical portfolios
If you don’t want to pick investments yourself, there are now plenty of platforms offering ready-made ethical portfolios.
Options include EQ Investors, Wealthify and Moneybox, all of which offer portfolios designed around environmental and social criteria.
You can also invest through platforms like The Big Exchange, or choose ethical funds via mainstream platforms such as AJ Bell, Interactive Investor and Hargreaves Lansdown.
Top 8 platforms for a green stocks and shares ISA
6. Look under the bonnet of your funds
Not all “green” or “ethical” funds are created equal. With stricter anti-greenwashing rules now in place, transparency has improved – but it’s still important to dig deeper.
Ask questions like:
- What companies and sectors does the fund invest in – beyond the top 10 holdings?
- Does the provider have a genuine commitment to sustainable investing, or just a few token funds?
- How actively do they engage with companies on issues like climate and social impact?
- Do their actions (like voting and stewardship) match their claims?
If you’re unsure, independent research and ratings – such as Good With Money’s Good Investment Review – can help cut through the noise.
The Financial Conduct Authority recently brought in new anti-greenwashing rules designed to improve the transparency and trust of investment products. See our full guide here.
Top 3 green funds for your ISA or LISA
7. Get advice if you need it
If you’re unsure where to start or have larger sums to invest, an ethical financial adviser can help align your ISA with your values.
Good Egg advisers include EQ Investors, Switchfoot Wealth, Path Financial and Castlefield.
They can help you build a diversified portfolio that reflects both your financial goals and what matters to you.
Top 9 ethical financial advisers
Your capital is at risk, losses from investments are not covered by the Financial Services Compensation Scheme and past performance is not a guide to future performance. Tax treatment is dependent on individual circumstances and is subject to change.
