Carbon neutral pension / SIPP?

zolou

So I declared a climate emergency in our household, and am now working towards becoming carbon neutral. Energy supplier (bulb) is already sorted, so pension is the big one. Our current "ethical fund" I believe does little more than avoid weapons and tobacco.

I'm struggling to find options - any ideas out there? I had been looking at getting help from "Investing Ethically Ltd", but the implementation fee is between £5K and £7K, plus annual fees, which is making my eyes water a bit.

I see PensionBee have the promising sounding Future World Fund, but it looks like it's more of a nudge in the right direction rather than a step change, and could be a long way from being carbon neutral.

Of course, it would be great if our pension investments could actually offset some of our carbon/methane spend in other areas, but that's probably shooting too high! I found a really interesting fund called the Nordea Global Climate and Environment Fund, but a single fund does not a pension make.

Would love any thoughts on this.

Albermarle

Our current "ethical fund" I believe does little more than avoid weapons and tobacco.

I think in the jargon, this is known as a 'Light Green' fund and what you want is 'Dark Green fund' that also looks at sustainability etc .
As far as I know most mainstream pension/SIPP providers have such funds available. Try these links :
https://www.hl.co.uk/funds/research-and-news/fund-sectors/ethical
http://www.morningstar.co.uk/uk/news/143293/3-top-rated-funds-for-ethical-investors.aspx
https://www.fidelity.co.uk/funds/esg-investing/
https://www.standardlife.co.uk/c1/funds/ethical-investments.page

AnotherJoe

I think you need to make a distinction between ethical and carbon neutral.
I know last year when i was looking at investing in batteries and related technology, there were a couple of funds I found that focussed on that, though in the end i invested directly in a company in that field.
There are also a couple of ETFs which follow the generality of the stock market but without oil related stocks, one of which (AFAICR) was more hard core than the other (eg one might not invest in Shell, the other wouldnt invest in Shell or (say) companies that made oil extraction equipment. Cant recall any names though.

AnotherJoe

Albermarle wrote: »

I think in the jargon, this is known as a 'Light Green' fund and what you want is 'Dark Green fund' that also looks at sustainability etc .
As far as I know most mainstream pension/SIPP providers have such funds available. Try these links :
https://www.hl.co.uk/funds/research-and-news/fund-sectors/ethical
http://www.morningstar.co.uk/uk/news/143293/3-top-rated-funds-for-ethical-investors.aspx
https://www.fidelity.co.uk/funds/esg-investing/
https://www.standardlife.co.uk/c1/funds/ethical-investments.page

Got to be sceptical about these classifications when (for example) the SL webpage above discusses "SRI" (sustainable*) as a type of ethical fund and then when you look at one of the funds in that area they point to, Vanguard SRI, that has nearly 6% in Oil and Gas and two of its top ten investments are Exxon and Shell ! :mad:

*Sustainable and responsible investment looks to invest in the most sustainable companies, those that manage the effect they have on the environment and the community for the greater good of society.

shinytop

It's all a bit of a judgement call though. Shell are investing alot in renewables. And which is more ethical, a company that makes $50k plus electric cars for rich North Americans to go to the mall or one that makes $2k petrol motorcycles for poor South Americans to go to school.

(And I don't know the answer!)

BLB53

I think it is very difficult to find a globally diverse 'carbon neutral' fund as most include big oil and gas companies such as Shell and BP or Exxon Mobil. But the investment climate is changing very quickly. Look for ESG or Impact funds but these are very variable in how 'green' they are.

You may find some of the information on the DIY Investor site useful as there are some 'green' investments covered.
http://diyinvestoruk.blogspot.com/p/green.html

I am sure with all the recent publicity from the likes of the David Attenborough progam and protests that the investments will change to offer more climate-friendly investments - it just may take a little time.

AnotherJoe

shinytop wrote: »

It's all a bit of a judgement call though. Shell are investing alot in renewables. And which is more ethical, a company that makes $50k plus electric cars for rich North Americans to go to the mall or one that makes $2k petrol motorcycles for poor South Americans to go to school.

(And I don't know the answer!)

Compared to their turnover profits Shell are investing the equivalent of a fiver for you and i though. Ad from an investment POV it doenst look good, well not to me. I sold up last year. Probaby not good timing but I was looking long term.
And regards $50k electric cars look at the bigger picture, Tesla has single handedly set the conditions to force other companies including the liars at VW to go seriously for electric cars. Without them the law makers and big auto would have said "its not possible" and we'd be stuck with (ahem) "clean" diesels or rubbish like the riversimple subsidy sucking impractical hydrogen car.

So, nothwithstanding the fact that when Tesla started it was $100k cars not $50k, now its $40-$50k and moving downwards. That was their business plan, start at the top and move down. I'm not brave enough to buy their shares though even if they are somewhat off the top this week.




Re your second question, the answer is "a company that makes electric bikes scooters and motorbikes for poor South Americans to go to school." And theres a lot of those now.I think electric tuk tuks are becoming a thing in some third world congested and polluted cities.

shinytop

Re your second question, the answer is "a company that makes electric bikes scooters and motorbikes for poor South Americans to go to school." And theres a lot of those now.I think electric tuk tuks are becoming a thing in some third world congested and polluted cities.

I'm sure they are in some places. When we stayed with a family in Central America last year the electricity supply couldn't reliably power a single light bulb for more than a few hours a day let alone charge an EV. I think alot of people in the world live like that.

zolou

Thanks all - I've been looking at the "Interactive Investor" SIPP recommended by Martin, and have found that Ethical Consumer lists some likely funds which it describes as "carbon-divested" eg FP WHEB Sustainability Fund. It seems you can pick those for the SIPP. Had to pay £30 for Ethical Consumer subscription. Will also check out some ESG and Impact funds as suggested. I'm thinking that I'll put together a plan and a portfolio, check the geographical and sector spread, then ask a financial advisor to sanity check it.

PensionBee have a fund called Future World Plan, but I think it's possible more of a little nudge than a step change.

zolou

Aha, think I may have found the very thing - Ethical Consumer has a great article about personal carbon divestment and I've discovered that there's a SIPP administered by Gaudi which lets you invest in Abundance funds, relating to renewable energy etc.

ethicalconsumer dot org slash ethicalcampaigns slash carbon-divestment

k6chris

zolou wrote: »

Aha, think I may have found the very thing - Ethical Consumer has a great article about personal carbon divestment and I've discovered that there's a SIPP administered by Gaudi which lets you invest in Abundance funds, relating to renewable energy etc.

ethicalconsumer dot org slash ethicalcampaigns slash carbon-divestment

https://www.ethicalconsumer.org/ethicalcampaigns/carbon-divestment