If you’re like many of the readers who follow our blog, you may have experienced a moment during the past few years when you contacted your fund manager or financial advisor to talk about clean energy or environmentally responsible investments. And if you’re like most of us, the answer you received may have been vague, confused, surprised, or maybe no answer at all.
“You want a mutual fund that invests in clean energy?” you may have heard. “Um…we don’t offer anything like that.”
But despite the recent wave of distressing climate news (including the current administration’s removal of climate change from a list of national security priorities, which we’ll discuss later this week), the landscape of options for environmentally responsible investors appears to be shifting. Most important, it appears as though sustained pressure from the public and from committed climate activists may be having an impact, and large investment firms are starting to listen to their clients and shareholders and move away from environmentally toxic assets.
Political action at the federal level may have limits as long as republicans hold both houses of congress, but financial action may have a wider reach, deeper impact, and more immediate results. For example, several cities including Philadelphia and Seattle have cut ties or renegotiated contracts with Wells Fargo after public pressure regarding the bank’s support for the Dakota Access pipeline.
Also, the World Bank just announced that it would end financial support for the oil and gas industries by 2019, citing “a changing world” and a new effort to ensure climate accountability. And Exxon Mobil will soon begin making assessments of how climate policy affects its various ventures after 62 percent of its shareholders voted to demand such action. The European insurance company Axa will also soon divest itself of millions of dollars of interest in Canadian oil production, deeming the fossil fuel industry “unsustainable, and therefore uninsurable.”
All of these announcements represent positive trends, despite stubborn policy inaction from the current U.S. administration. And in the financial realm, there are plenty of ways for each of us to take action, and the list appears to be growing. If conversations with your financial institution haven’t born fruit in the past, now may be an excellent time to try again. Years ago, your firm may have offered only a small handful of so-called “activist ETFs”, but the tides have shifted. Contact your financial advisor and ask again, and meanwhile, don’t ignore opportunities for proxy voting! The questions that appear on your ballot may involve direct climate action potentially taken by the firm—provided shareholders make their voices heard. Contact our office to learn more.