Does Your Money Have a Footprint?

When you consider your impact on the environment, what comes to mind first? Is it the flights you take? Or road trips in your car? Or maybe it’s the food you eat?


Have you thought about your money?


Money isn’t the first thing that comes to mind when you think about the climate emergency.


Your savings, pension, and personal investments may not appear to be a direct contributor to greenhouse gas emissions.


However, the financial institutions with which you invest and give your business may have a significant environmental impact.


As a consumer, the choices you make about your money can help to lower your footprint and stop climate change.


According to  2020 research by Rainforest Action Network and five other not-for-profits, 35 of the world’s top banks – many of them household names – have provided $2.7 trillion (£2 trillion) to fossil fuel industries since the Paris Agreement on climate change was implemented at the end of 2015.


To make matters worse, this financing of fossil fuels has grown year on year since the Paris Agreement was signed.

Your current account isn’t directly at risk of being used to invest in fossil fuels.


“Retail banks are ringfenced by law from investment banking,” says Alex Money, director of the Innovative Infrastructure Investment programme at the University of Oxford’s Smith School of Enterprise and the Environment.


 “This basically means, from a bank’s point of view, they can’t use money that customers are giving them on deposit to then speculate or take market positions with that money.”


However, this does not mean that you, as an individual, are powerless to influence your bank’s investment strategy.


If you want to find out what banks are doing before you decide to use their services, or you want to find out what your current bank is up to, there are a number of places to look.


You can look at the Rainforest Action Network research which names all the largest fossil fuel funders, as well as reviewing numerous banks’ climate policies.


BankTrack, a non-profit, also offers specific information on its website, including lists of which banks refuse to finance Arctic oil and gas companies or tar sands projects. says that ‘People tend to vote with their feet really about some of these things if they feel strongly enough about it’.


If you aren’t happy with your bank’s policies, the time has never been better to change.


There are a growing number of new, smaller banks that are positioning themselves as ethical solution providers and funders.

Your pension is another important way to use the power of your money to help the environment.


According to the Thinking Ahead Institute’s latest Global Pension Assets Study, the world’s pensions are worth an estimated $47 trillion (£34 trillion), accounting for approximately half of all money invested in the global financial system.


Sadly, according to ShareAction’s analysis, fewer than 1% of assets in the world’s top 100 pension funds were invested in low-carbon solutions in 2018.


Only 15% had a policy to avoid investing in fossil fuels in some way, while 65% had no clear climate policy at all.


If you engage with your pension and look at how the money is invested, you can have a big impact, switch to one with sustainable investment policies.


In the UK this should become easier soon as pension funds will soon be forced by new laws to disclose all their climate policies and risks.


It’s not all bad news as interest in sustainable investments is growing rapidly.


In 2019, a record $20.6bn (£15.1bn) was put into sustainable funds in the US and the trend has been followed around the world.

‘Although it may not seem like the most obvious approach to reduce your carbon footprint, the way you save, invest, and use your money can have a significant positive impact on the environment.’ 


Richard Dickson – Co-Founder Play It Green.

If you want to learn how to lower your footprint and help reforest the planet, take your first step on your journey to a sustainable future by subscribing to Play It Green for as little as £1.25/week.

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