Bohemian at heart
November 2007

Saving the planet just got easier

You know who you are. You're the babe who makes the effort to recycle your rubbish, shop with your 'Green' bags, walk to work, and is currently purchasing a rainwater tank.

You want to do your bit to help save the planet, and you do it without a cape, lycra or superpowers to help you. But sometimes you think, 'Is this all I can do to help?'

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Superwomen at heart take note, there is even more you can do to influence the world you live in.

At lot of the commentary about sustainable living these days focuses on the tips I mentioned in last month's column. But a more powerful way into the future will be sustainable investing. By that I mean supporting investments which are improving the sustainability of this world and avoiding companies that are adding to its destruction. How can you do this? It's quite simple.

Money talks
You and I have assets, and no, not just your latest purchase on ebay or from your shopping trip to Melbourne. I mean investments, shares, cash, property and superannuation. All of these assets are invested somewhere in something.

Do you know what your money is up to?
Could you unwittingly be supporting de-forestation or the new pulp mill in Tasmania? Chances are if you have an investment in one of Australia's oldest and largest managed funds, then you are supporting this plantation company.

Alternatively, if you are concerned about weapons and armaments, then you may find it disturbing that one of Australia's top four banks has cash invested in a company which produces weapon systems for the US Army and Navy. It's quite an unsettling reality.

When you think of all those dollars from your hard-earned pay packet being siphoned into super you may sigh and wish you could instead invest them in a fabulous new pair of heels. But an even worse thought is that your money (super or other investments) is contributing to some of the very issues you may feel quesy about:

• Global warming
• Nuclear weapons / Armaments
• Uranium mining
• De-forestation
• Unethical working conditions in third world economies
• Genetically modified foods
• Cruelty to animals
• Gambling

Where can you invest sustainably and responsibly?
Wouldn't you rather be responsible for supporting the world's first clean coal project? Or supporting companies that produce and sell alternative energy such as wind turbines, solar power, or geothermal energy? Did you know that you could choose to support 5 star energy-efficient office or retail properties or companies that work with developing nations to improve their infrastructure, education and offer microfinance?

Certainly those of us with our eyes wide open can see that the smart, sustainable businesses which focus on the 'triple bottom line' of People, Profit and Planet, are the ones we should be supporting.

What if I do nothing?
If you do nothing and leave your investments as they are, be aware that in the future carbon pricing may affect the value of some companies. The Australian Climate Change Institute (ACCI), for example, estimates that Australia's Generation X may lose up to $1,300 per annum in superannuation each year.

How is this so? Well to date, there has been very little modeling on how carbon pricing will impact companies and their respective stock values. The ACCI believes that the longer inaction continues, the bigger the adjustment in the stock market and super balances when these factors are priced in.

Make a Choice
You have the choice of investing directly into innovative companies that run sustainable businesses; many are listed on the Australian stock market. To access international companies that are changing the world, you can choose from a variety of sustainable, responsible and ethical managed funds.

So, what next?
As they say, Money Talks! If you are interested in making more sustainable choices in your life, I would encourage you to keep up your eco-friendly lifestyle, but most importantly review your finances.

Research what you currently own. Ask yourself, 'Am I happy with my investment choices and what they stand for?'

If you're not, switch to sustainable investment funds and stocks yourself. Or, if you'd like help from a specialist, feel free to contact me.

Don't be overwhelmed, be enthusiastic and empowered that you can make a positive difference in the world and also grow your wealth. It's the way of the future.

Karen McLeod is passionate about sustainable living and a member of the Responsible Investment Association (Australasia). As a Certified Financial Planner, she helps clients invest more sustainably and responsibly.

Karen McLeod e kmcleod@globalfsg.com