Sustainable Life: Getting sustainable with money
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Money makes the world go round.
Where would we all be without access to a bank account, a home loan, insurance or a retirement pension? The choices we make with our money can influence far more than just our personal bank balance and convenience—they’re fundamental to our planet’s health. If we’re not careful, every time we put money aside for retirement, we could be investing in fossil fuels, deforestation, human rights abuses, and gambling. If we care about more than just our financial return on investment, it doesn’t have to be that way.
Here’s how to be smart with your money and use it to create a future planet that’s sustainable and regenerated with just a few, simple choices.
Superannuation
According to UK-based charity, Make My Money Matter, switching your super fund to one that is environmentally and socially responsible is 21 times more impactful than switching to renewable electricity, switching from air to rail travel, and becoming vegetarian. Pensions are the largest single asset pool in the global market, contributing a massive USD 56 billion to global investments in 2020. A few small decisions from many individual humans can make a big, lasting difference.
Get to know your superannuation arrangements. Most developed countries have a compulsory retirement pension scheme, where employers contribute a percentage of your fortnightly income to a fund. Employers usually have a default fund but you can also choose. Do your research and choose a fund with environmental and social credibility.
Banking and insurance
As consumers we have the power to set our expectations of the future by voting with our money. We can choose our bank or insurance provider, based on both customer service and climate impact.
According to the International Energy Agency, the road to global net zero emissions by 2050 is narrow. Along that pathway there must be no new oil and gas fields approved for development and no new coal mines or coal mine extensions. Unfortunately, governments are failing to adequately regulate and the surest way along this narrow pathway is to follow the money… by setting our expectations as consumers and making it clear that we won’t be customers of institutions without an environmental or social conscience.
Want to make sure you haven’t been green washed? Companies that are certified B Corporations have demonstrated high social and environmental performance. There are banks and insurance companies around the world already signed up.
Ethical investment
Ok, so not everyone has enough money to be able to invest—but if you do, make that money work to create your vision for the future. Consider investing with a fund or company that has a positive environmental or social impact. Generally, the world of ethical investments simply excludes particular industries, like fossil fuels, gambling and weapons production. You can take it one step further and invest with companies that take a positive-vetted approach, only investing in climate positive, sustainable and regenerative projects, like Australian Ethical Investment.
Household level consumers can drive standards across the finance sector, from banking and insurance to pensions and investments. Let your money work to create a sustainable future for us all.
