How To Switch To More Ethical Banking
Government regulation designed to reduce monopoly in the UK banking sector has forced banks to make switching accounts quick and easy, taking just seven working days.
When you open a new bank account, it will usually ask you during the application whether you want to switch. If you do, by providing the details of your old account, the switching service will move your money, direct debits and standing orders across, and close your previous account. It will also transfer any payments meant to go into your old accounts, for example your salary.
For at least three years, any money paid into the old account or wrongly down to come out of that account will be moved across into the new one. We asked about our readers experience.
Sarah, who recently switched from HSBC to a more ethical option, said that she was motivated to switch accounts by:
The knowledge that my investments and any interest gained by the bank was ultimately being used to fund things/activities that I find abhorrent: Amazon rainforest destruction and other global warming/ecologically damaging companies. I did not previously know this. It couldnt have been easier. The switch guarantee service was as easy as switching electric or Wi-Fi supplier.
Remortgaging is always hard but it wasnt any harder moving banks. My only concern was why didnt I do this sooner.
A History Of Successful Shareholder Resolutions
As You Sow has a long history of enabling change throughout the U.S. corporate structure. In 2019 alone, the group filed 93 shareholder resolutions after negotiations failed to implement new strategies.
Resolutions happen when engagement with a company doesnt go the way we want it to, Behar said. We want them to agree to our terms which could be anything from stopping the use of plastics, issues around climate change, or halting pesticide use.
After filing those resolutions, we successfully negotiated and came to terms on 61 of them before the vote, Behar said. Another 21 went to vote and we received an average of 27% of the vote.
Behar noted that the votes that take place at these meetings are non-binding meaning the company doesnt have to adhere to the terms. The goal isnt solely for shareholders to get their way. By addressing these issues, companies reduce their overall risk and polish their brands in the eyes of most consumers.
Over the last three years, weve negotiated with basically every major fast-food company and got them to agree to stop using antibiotics in their poultry, he said. That led to Perdue, Sanderson, and other big producers stopping use of them.
These changes came about through the efforts of nonprofits, such as As You Sow, that play a major part in keeping corporations accountable for their actions and practices.
Top 10 Things You Can Do About Climate Change
People throughout Canada and throughout the world are taking action to help fight climate change. What changes will you make?
As the world warms, extreme weather events are becoming more frequent and intense, sea levels are rising, prolonged droughts are putting pressure on food crops, and many animal and plant species are being driven to extinction. Its hard to imagine what we as individuals can do to resolve a problem of this scale and severity.
The good news: We are not alone. People, communities, cities, businesses, schools, faith groups and other organizations are taking action. Were fighting like our lives depend on it because they do.
In a world of more than seven billion people, each of us is a drop in the bucket. But with enough drops, we can fill any bucket.
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Green Bank Offered Another Bite At Fossils
Australia’s green bank has been offered a second chance to invest in fossil fuels as the climate wars continue in Canberra.
The federal government has redrafted rules to expand the remit of the Australian Renewable Energy Agency after its first attempt was quashed by Labor and the Greens.
The regulations allow ARENA to invest in low emissions technologies including carbon capture and storage and clean hydrogen.
Energy Minister Angus Taylor delivered the political wedge ahead of a parliamentary sitting week.
“We’re not building a nuclear generator tomorrow or anything like that, but it is about saying technology is changing fast and we need to keep a close eye on it,” he told 2GB radio on Friday.
“You know, ruling things out is the wrong thing to do in the energy debate or any of these sorts of debates. As soon as you start ruling things out, you make life harder for everybody.”
Environmental groups have described the move as an attack on clear energy funding and urged the Commonwealth to invest in renewables backed by storage.
Mr Taylor hammered home his “technology not taxes” emissions reduction mantra to justify the approach.
“It’s time to ditch the political opportunism and scare campaigns … and get on with looking at all technologies to ensure we can provide affordable, reliable energy as we bring our emissions down,” he said.
Labor and the Greens could move another disallowance motion to reverse the expanded remit.
It is unclear whether lightning would strike twice.
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Despite The Paris Agreement Banks Show Little Sign Nor Genuine Commitment Of Slowing Their Investments In Fossil Fuels In Fact Spending Is Ramping Up So Which Banks Are The Worst Offenders And What If Anything Can You Do About It
The Intergovernmental Panel on Climate Change has issued repeated warnings of the catastrophic consequences should the world exceed 1.5 degrees of warming. Although nearly 200 nations outlined plans to reduce emissions following the 2015 Paris Agreement, since then banks have done little to positively contribute. In fact, their continued financing of fossil fuels aligns instead with climate disaster.
But as shareholders, regulators, clients, and the general public recognise that banks must be held accountable, will we begin to see systemic change? Here, we take a closer look at the global banks who are failing to take responsibility and mitigate their climate impact.
Whats the issue?
The Paris Agreement states that finance needs to be consistent with a pathway toward low greenhouse gas emissions. But according to the Banking on Climate 2020 report, large global banks arent working towards this goal. In fact, theyre failing miserably.
Over the last four years, the worlds largest banks have pumped $2.7 trillion into fossil fuel firms. And financing looks set to increase with American, Canadian, Chinese, European, and Japanese banks leading the way.
While some have taken steps to mitigate their impact by setting climate-friendly targets, the report states that overall major global banks have simply failed to set trajectories adequate for dealing with the climate crisis.
Why does this matter?
The dirty 30
Data and table courtesy of Banking on Climate Change 2020
How Barclays And Other Banks Are Funding Climate Change
Think you know your climate villains? One thing you might not know is that banks such as Barclays have earned themselves a place at the top of the list. They’re funding the companies fuelling climate change whether it’s drilling for oil, clearing forests or violating human rights.
2nd March 2020
Its clear: banks are just as guilty for the destruction of our climate as the fossil fuel companies that they fund.
Since the Paris climate agreement in 2015, where the world agreed to avert the worst effects of climate breakdown, the worlds top banks have poured $1.9 trillion into fossil fuel financing. And thats not even counting their 2019 investments which are still being calculated.
While many banks may invest in renewable energy too, the bad far outweighs the good. In the last three years, global banks have only put $130 billion into green projects. Thats less than 7% of what they pump into oil, gas and coal.
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What Kinds Of Fossil Fuel Projects Are Being Funded
Every year, the Rainforest Action Network works with BankTrack, Indigenous Environmental Network, Oil Change International, Reclaim Finance, and the Sierra Club to record which banks are providing funding to a variety of fossil fuel industries. They keep track of financing completed for oil extraction from tar sands, the arctic, fracked oil and gas, offshore oil and gas, coal mining, and coal power plants. To do this, they follow over 2,300 companies to see which banks and investors are financing their projects every year. We review that report annually and share their key takeaways.
Despite the fact that the risks of climate change have received more attention and focus, funding for fossil fuels has increased annually, with fossil fuel financing totaling $751 billion in 2020 just from the worlds 60 largest banks alone.
What Not To Buy
What to avoid when choosing an ethical bank account:
Is it financing climate change? All of the big banks have extensive investments in fossil fuels, including the most damaging ones like tar sands and ultra-deep sea drilling. Also be aware of investments in the fracking industry.
Is it funding the Israeli military? War on Want released a report detailing the relationship between UK financial institutions and companies that sell arms and military equipment to Israel which have been used in the oppression of Palestinians.
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What Is Active Stewardship
Active stewardship refers to the actions that investors like RBC GAM can take to better understand and influence the activities of companies in which they invest . We often express our views through:
- Engagement with issuers, either directly or together with other like-minded investors. Engagement allows us to learn about how issuers are approaching opportunities and key risks in their business due to climate change.
- Proxy voting on management and shareholder proposals. Proposals from shareholders often relate to climate change.
Is Your Money Making Meaningful Investments In The Community Or Just Funding Pipelines Mighty Deposits Lets You Comparison Shop Banks Behavior
What does your bank actually do with the money you deposit? Most customers dont knowand while some progressive banks might use your cash to make loans for affordable housing or renewable energy, others might pour it into fossil fuels.
A new website called Mighty Deposits is designed to help make banking more transparent, so customers can more easily find a bank that aligns with their own values. Typically, the founders say, customers might decide to leave a bank if its caught behaving badlyas in the scandal when Wells Fargo created millions of fraudulent accountsbut in terms of simple day-to-day activity that might not fit with your morals, its difficult to choose between alternatives. What doesnt exist is a shopping aisle for banks, says Mighty Deposits founder and CEO Megan Hryndza. Its really good to understand your choices when youre spending your money.
If you bank with JP Morgan Chase, for example, Mightys tool will inform you that the bank invests only 15% of your money in housing, 11% less than average, and only 1% in small businesses80% less than average. The site will soon begin adding additional data from other sources. The law doesnt require banks to report sustainability metrics, but Mightys team is working with data from nonprofits to add data about fossil fuel investments. The site also lets users search for banks that are better-aligned with their own interests.
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Mining And Human Rights
In May 2018, Facing Finance published Dirty Profits 6. The report looked at the global extractives industry, which was involved in some of the worst labour, environmental and human rights violations. It found that:
The rights of communities, farmers and indigenous people are being trampled in the push for ever more extraction.
The report also looked at whether implicated companies and the financial institutions behind them had responded to evidence of violations published in its 2012 Dirty Profits report.
It found that companies had largely failed to respond.
Orlando And Fort Lauderdale
First Green BankBank
Located in Florida, First Green Bank is a member of the Global Alliance For Banking On Values. As you can probably tell by its name, First Green Bank has an environmental and social mission. It also pays all its employees a living wage and makes 75 percent of its loans to small- or medium-sized businesses.
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How Do My Banking Habits Affect The Environment
Have you ever thought about how many bank statements will be mailed to you throughout your lifetime?
Aside from paper costs, add to that transport of the letter to get there.
In reality, the technology shift is helping us all save in resources but theres more you can do.
- Use internet banking or apps when you can. Instead of visiting the branch, bank online! This helps save resources, as with fewer branches, less energy will be used to maintain them.
- Stop getting statements mailed to you. Opt to get them emailed instead. This saves paper and resources to send it to you. To be honest, I find it so much easier for filing purposes too!
Exclusive: World Bank Revises Climate Policy But Stops Short Of Halting Fossil Fuel Funding
5 Min Read
WASHINGTON/BRUSSELS – A revised World Bank policy on climate change commits to making financing decisions in line with efforts to limit global warming, but stops short of promising to halt funding of fossil fuels, according to a draft bank presentation seen by Reuters.
The World Bank, the biggest provider of climate finance to developing countries, is finalizing a new five-year climate action plan amid growing political momentum in Britain, the United States and other countries for ending public financing of high-emission fossil fuel projects.
In a sharp reversal from the former Trump administration, the United States, the banks largest shareholder, is drafting plans under the new Biden administration to end U.S. financing for international fossil fuel projects.
An internal presentation outlining the World Banks new climate plan, seen by Reuters and due to be discussed by the banks board on Thursday, commits to align its financing flows with the objectives of the Paris Agreement by July 2023.
The plan is not final and must still be approved by the banks board.
The World Bank declined to comment on the presentation.
The banks sister organizations, the International Finance Corporation and Multilateral Investment Guarantee Agency, will align 85% of their direct financing with the Paris Agreement by July 2023 and 100% by July 2025, the presentation said.
The draft presentation did not include these commitments.
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Invest In A Better World
Are you funding a new coal mine without knowing it?
These investment managers are members of the Responsible Investment Association Australasia which champions responsible investing and a sustainable financial system.
Nanuk Asset Management
Nanuk Asset Management is an independent investment manager with staff located in Sydney, London and New York. Nanuk is globally focused, investing in listed companies that are contributing to or benefiting from the global transition to more environmentally sustainable and resource efficient technologies and practices. You can find out more about how Nanuk invests by accessing their website.
Melior Investment Management
Melior Investment Management is a Sydney based Australian impact investment manager that is committed to driving positive change. When selecting investments, Melior seek to invest in Australian and New Zealand companies delivering competitive market returns and positive social and environmental impacts aligned to the Sustainable Development Goals. You can find out more about how Melior seeks to invest for a better world by accessing their website.
WHEB Asset Management
What Are Some Of The Ethical Investments Included In This Option
- Salesforce is an integrated CRM system committed to creating a sustainable, low-carbon future by delivering a carbon-neutral cloud for its customers. In 2020, Salesforce secured renewable energy supply equivalent to 63% of their current global use and are on track to achieve their 100% renewable energy target by 2022.
- African Development Banks Fight COVID-19 social bond was the largest social bond issued to date in international capital markets. The bond aims to combat the social and economic fallout across the African continent from the affects of the coronavirus pandemic through financing health services and other essential services and infrastructure.
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