Actively choosing not to invest in fossil fuel...

Avoirdupois

So as it's become increasingly clear that the fossil fuel industry is doing its best to resist change as well as engaging in so-called greenwashing, many of us ordinary savers and investors want to steer clear of supporting them by giving them our money.  Of course, this idea has been around for a while in the form of 'ethical investment' however I'm going to suggest that not wishing to invest in fossil fuels is different.  Ethical investment has brought with it the risk of lower returns, which has been acceptable to investors who are content to make the choice in return for a clear(er) conscience.
We're entering a different state of affairs - the aim of influenceing fossil fuel industries in whatever ways possible is quickly being adopted as a mainstream tool in our reaction to climate chain and far from being the preserve of the minority who want to pursue ethical investment, it's becoming the norm.
With that in mind, how do you seasoned investors and those who know the game well deal with this issue?

ColdIron

I don't deal with it at all. I'm an equal opportunities investor

I'm not prepared to accept lower returns and fish with a much smaller net (most index funds will be out of reach)

wmb194

But where would we all be without petrochemicals?...

El_Torro

Ethical investing means different things depending on which fund manager you ask. It's up to us to see if the fund we're investing in meets an adequate criteria. 

Also, I think it's a bit difficult to not invest in fossil fuels. Sure, we can avoid oil companies, but what if the company I'm investing in uses energy that comes from fossil fuels? They might be producing vaccines (or whatever) but they are directly / indirectly funding the extraction of fossil fuels. Or if I decide to invest in a company that uses plastic, at least some of that plastic will come from fossil fuels. 

ColdIron

And it's only the Aramcos, Exxons and Shells of this world that have deep enough pockets to make non fossil fuels a reality in a practical sense. There is a good argument to be made that we encourage them to further their research

Beddie

I'm very happy to invest in fossil fuels, if they are a good investment. The same goes for renewables and anything else. I act in a green way in most aspects of my life and consume far less than the average user, so I've done my bit. But I won't make myself poorer deliberately for this.

DullGreyGuy

Avoirdupois said:
Of course, this idea has been around for a while in the form of 'ethical investment' however I'm going to suggest that not wishing to invest in fossil fuels is different.  Ethical investment has brought with it the risk of lower returns, which has been acceptable to investors who are content to make the choice in return for a clear(er) conscience.

It's not different, it's just one dimension of ethical investment. If you actively rule out one class of investment, and do it properly (eg you wont invest in other businesses that invest in fossil fuels as well as not directly) then you too will be accepting the potential for a lower result than if you'd been open to any class.

Personally, I think these things are so nested that the only way to be sure you aren't investing in fossil fuels, arms, tobacco or anything else on your hit list is keeping your money under your mattress. I'd applaud a reasonable endeavours approach but its a habit hole you can go down.

mark_cycling00

"big oil" companies use their carbon products as a reliable cash-flow that they use to invest in renewables. Globally, oil companies invest 400x more into renewables than renewable energy companies do. That's in the GS presentation to COP21. 

The green energy that Ecotricity built in 25 years, BP builds every 25 days. BP literally create a major green energy company every month. Ironically Ecotricity still purchase 60% of their renewable energy from BP.

None of these companies have any desire to be an oil company anymore. The exploration involves dangerous, risky environments, corrupt dictators, terrorist attacks etc.

The risk we face is that global energy companies only create renewable energy in safe, western countries and China fills in the gap but only in countries with natural resources to exchange. 

Qyburn

Avoirdupois said:

So as it's become increasingly clear that the fossil fuel industry is doing its best to resist change as well as engaging in so-called greenwashing, many of us ordinary savers and investors want to steer clear of supporting them by giving them our money.

The company doesn't get your money when you buy their shares. You may not want to profit from their success, but I don't know what direct affect if any this will have on the company.

subjecttocontract

Better stop shopping in supermarkets then as all their stock is delivered by diesel fuelled trucks !

wmb194

Qyburn said:

Avoirdupois said:

So as it's become increasingly clear that the fossil fuel industry is doing its best to resist change as well as engaging in so-called greenwashing, many of us ordinary savers and investors want to steer clear of supporting them by giving them our money.

The company doesn't get your money when you buy their shares. You may not want to profit from their success, but I don't know what direct affect if any this will have on the company.

This could be true of the majors but there are plenty of smaller firms raising capital in the markets via equity and debt.