Is it time for our cash to go green?

24 September 2018

Perhaps it’s time we all took a long hard look at where our money is going.

I went green last year – and no, I don’t mean green around the gills after a raucous night out (I’m far too sensible for that, after all) – I’m talking about energy.

When I moved house, I checked if I could save by switching. The answer was yes, I could save £100s in fact. However, by cutting that saving ever so slightly, I could also go green.

I weighed up the options and decided I’d rather spend a little bit more on my energy bills each year in the knowledge that I was cutting my carbon footprint and therefore making a small contribution to the very real (despite what President Trump may tell you) battle against climate change.

Now, I’ll be upfront about this, although my electricity is produced by 100% renewable sources, only 10% of my gas is green. Different suppliers offer different green ratios, with energy produced using different renewable sources, and all for a different price. So it’s a case of striking the right balance between your budget and your conscience.


But should I be going green in other areas of my life? It’s a timely topic to debate, given that Good Money Week, which raises awareness of sustainable, responsible and ethical finance, begins this month (29 September to 5 October).

My willingness to go green with my energy has yet to expand to other areas of my life – I don’t bank with an ethical provider or go out of my way to buy Fairtrade products – although I’m seriously considering doing so. After all, if I can still make my money work as hard for me as it’s currently doing, I’d feel better knowing it’s going to beneficial causes.

And it seems this desire for our money to do something positive is increasing. Mike Fox, manager of First 50 fund Royal London Sustainable World Trust, told me when I interviewed him recently that he’s seen a spike in the last couple of years of people investing in his sustainable fund.

Meanwhile, John David, head of Rathbone Greenbank Investments, commented last year that “the UK has become a hub for innovation in sustainable investment. What was once seen as niche has now become mainstream.”

So, what’s prevented me from putting my money where my mouth is? Is it a lack of decent products, hazy information about how companies are ethical, sustainable or socially responsible, simple inertia or something else?

For users, when it comes to investing, it’s mostly the fear of low returns that puts people off. When we asked earlier this year if our readers viewed themselves as ethical investors, the largest response, receiving 28% of the votes, was “No, I don’t invest in ethical, sustainable or socially responsible funds because I believe the returns will be better in other sectors.”

This may be the case with certain products – ethical providers Co-operative Bank and Triodos, for example, fail to feature in Moneywise’s best buy savings and Cash Isa tables – but some experts argue that sustainable investing doesn’t act as a drag on returns when you’re investing in the stock market. Camilla Ritchie, an investment manager at Seven Investment Management says: “Sustainable investing can actually improve returns and reduce risk, potentially protecting your portfolio from some nasty shocks.”

Other sources indicate age is a factor in our willingness to go green. Research from Atomik on behalf of Rathbone Greenbank Investments showed a big generational divide in attitudes towards ethical investment, with those aged 25 to 34 far more likely to get involved (36%) than over-45s (6%).

However, whichever way you look at it, Good Money Week has a strong argument: “By choosing sustainable and ethical banks, pensions and investments we can make sure we aren’t giving money to companies that fund problems such as child labour, modern slavery and low pay.”

Perhaps it’s time we all took a long hard look at where our money is going.

A fond farewell

September’s magazine is my last at Moneywise. From joining as deputy editor in December 2015 to leaving as acting editor now, I’ve thoroughly enjoyed playing my part in the magazine’s 28-year history. I’ve also come a long way when thinking about my own finances over this period, which has included the mighty step of buying my first home. Thank you to all the readers who’ve contacted me with their personal finance views over the years – I’ll certainly enjoy joining you all as a reader of Moneywise going forward.