New Model Adviser: Time is running out, all investments need to be sustainable

Good Money Week starts on 5 October. At the same time, Extinction Rebellion will be on the streets of London calling for urgent action on the climate and ecological crisis. I joined Extinction Rebellion in February.

Though one group may be sat on hay bales in a road holding a people’s assembly, and the other at plush conference tables, they actually have plenty in common.

Both events are calling for a financial system that ceases causing harm to people and planet in the way it traditionally has – funding and profiting from industries that pollute, harm and endanger human life. Both groups want a financial system which is sustainable.

The main difference between the two groups, though, and the reason I will be on a hay bale and not in a chair, is the sense of urgency each one has for the changes they want to see.

Nevertheless, advisers and investment experts trying to get what we now think of as sustainable finance to be considered simply as finance, could not be keener to see that change enacted immediately.

They are connecting the dots between the devastation clients feel when they see the Amazon Rainforest burning, and the fact that every day large investment companies fund the burning of rainforests as a matter of course, lending $44 billion (£36 billion) to agribusinesses since 2013.

How often do you hear an investment manager talking about their sustainable fund saying, ‘this is an emergency’ in reference to global heating?

Emergency messaging is core to Extinction Rebellion. Perhaps this sense of urgency comes from the way it confronts and engages with the horrifying scientific projections laid at our feet, if we do not act.

Having spoken to plenty of Extinction Rebellion colleagues, I know their motivation to act now also comes from years, sometimes decades, of frustration that built up while they worked for change within their respective industries. All the while they were making sustainability a thing, shifting consciousness about how we interact with the world. In finance they were trailblazers, shaping new ways of investing that are now being mimicked (more or less successfully) by nearly every major fund house.

But these folks knew it was not happening fast enough. And unable to get that message through to those around them they joined the roadblocks and the banner-making. A note on the pace of change needed: the end of 2020 is considered the hard deadline for the peak in global carbon emissions if we want to keep temperature rise this century below 1.5 degrees, or what Prince Charles calls ‘survivable’ levels of climate change.

Julia Dreblow, director of SRI Services, is one of those professionals marching towards transforming finance and is determined to bring the advice community with her. Her SRI Services event during Good Money Week is one of the linchpins in the sustainable finance calendar.

Dreblow has spoken before about the huge number of assets under advice in the UK – the Personal Investment Management & Financial Advice Association estimates the figure at £274 billion in 2018 – making it all the more important advisers can help clients use those assets to pressure oil companies to clean up their act and stop trashing the planet.

I hope that in between attending Good Money Week events delegates will come and have a chat with Extinction Rebellion to share ideas and inspiration for the future.

Change does not depend on everyone supergluing themselves to buildings, but the scale and nature of this challenge is unlike any humanity has ever seen and requires equally unprecedented levels of cooperation to overcome it. We are all in this together.

This blog was first published by New Model Adviser on 3 October 2019:

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s