I want to put my money where my heart is
And not fund any more fossil fuel projects
UK's finance industry produces 2x the CO2 produced by the country. If it was a country, it would be the 9th highest emitter of CO2.
But are you wondering as to how can the finance industry produce so much emission?
It's not through their buildings and operations. But through the fossil fuel and deforestation projects that they finance.
The situation is no different in North America.
US and Canadian banks account for almost half of global fossil-fuel financing over the last five years.
From 2016-2020, Canadian banks poured over $700 bn into fossil fuels. 17 of the top 60 global banks have committed to being net-zero by 2050.
But since the Paris climate deal in 2015, the top 60 banks have provided $3.8tn of financing for fossil fuel companies.
This is 3 times more than the total bonds and loans provided to green projects.
But there's some good news.
As a retail or institutional investor, if you don't want your money to fund fossil fuel projects, there are alternatives available.
These 3 startups are a great example⬇️
Climate solutions need investment…To avoid the worst impact of climate change, between now and 2050, at least $1 trillion has to be invested each year into clean energy and climate solutions. Large banks and VC funds, which typically have massive amounts to invest, have stayed away from investing in renewable energy projects (reason- unattractive risk-return profile). Moreover, millennials are showing an increased interest in sustainable investments.
You get to choose and measure your impact…Raise Green has an alternative solution for people who want to have an impact on climate change through their investments. Operating as a climate tech marketplace, it provides investors (institutional and individual) with a choice of verified local impact projects to invest in.
It operates like a 2 sided marketplace.
On one hand, there are innovators seeking investment for their community solar and energy efficiency projects.
On the other hand, there is a wide range of investors(anyone in the US), looking for verifiable and impactful investment opportunities.
Can’t invest much, no problemo…The amount invested by the investors determines the equity that they own in the project. The amount invested could range from $100 to $100,000. Investors have the option to exactly see the amount of clean power that their dollar has produced.
Greenwashing in the investment space…New investments in sustainable funds doubled in 2020 vs 2019, reaching a whopping $51 billion. Investors are looking for sustainable investment options but they are often misled by firms and funds. While they think that their money is invested in activities mitigating climate change, a big chunk of it eventually ends up funding fossil fuel projects. Although sustainable funds are growing in number, the funds that are completely fossil fuel-free are still low.
Thinking beyond risk and return…Finnish startup Cooler Future is building Europe’s first climate impact investing app. They want to provide active investors with a portfolio of assets where the positive climate impact can be quantified. To an average investor, they want to show the real power that their investment can have on climate change.
Through a globally diversified fund, they will exclusively invest in sustainable companies and projects.
The fund will use both traditional and modern analysis to decide which companies to back.
Apart from risk and return, they would also communicate the climate impact of their investment to the investors.
What’s my impact?…Through their app, everyday investors can look at the CO2 impact of their investments. Adopting a transparent approach, Cooler Future will disclose the impact calculations and the investments.
Look, the situation is serious…We cut down 15 billion trees every year and the global tree count has fallen by 46% since the beginning of human civilization. In the last 50 years, we have wiped out 2/3rd of the global wildlife population. At the current rate of destruction, by 2050, more than 143 million people in Sub-Saharan Africa, South Asia and Latin America will be forced to move to escape the impacts of climate change.
Reforestation on auto mode…Founded in August 2020, TreeCard is swapping the idea of loyalty points with planting trees. With every purchase that the consumer makes through ‘world’s first wooden debit card’, an amount is directed towards reforestation.
Everytime you swipe your debit card, the merchant pays a small transaction fee to TreeCard.
TreeCard uses 80% of the profits from that towards 38 reforestation projects located around the world.
To avoid greenwashing and promote transparency, only projects that are strictly monitored (satellite technology and field visits) are chosen.
The card is 100% free for users…and as it’s operated using the Mastercard network, it can be easily linked to your existing bank account. Conventional cards are usually made from hard-to-recycle laminated plastics while this is made from sustainably sourced FSC-certified cherry wood. If you’re wondering whether this leads to deforestation too, one single tree can produce more than 300,000 cards (did we mention no plastic pollution?)
Today’s crossword is a mixed bag
Try solving it here
Here are the responses to last week’s crossword-
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