"Investing in an ethically managed fund or super fund is one of the biggest, yet easiest, things someone can do to make a real difference on a range of environmental and social issues."
- Australian Ethical Investment

While most of us are taking steps to reduce our impact on the environment and help lessen the potentailly devastating impacts of climate change, often involving choices about how to spend our money - many people don't consider the impact their money is having - or could be having - while it is sitting in bank accounts, superannuation funds and investment options. While the amount of money sitting in our bank accounts might seem small, collectively Australians give billions of dollars to banks as care-takers for us. While keeping this money safe for us, and offering us moderate returns through interest rates, banks invest our savings in all sorts of activities and projects. In a letter to Westpac, the parent company of ARRCC's bank earlier this year, asking about Westpac's policy for investing in dirty coal powerplants, ARRCC wrote:

"One of the many choices that people make every day is what to do with their money and where to keep it. We believe that it is in everyday choices such as these that people can truly reflect their values and their vision of a good and just world. ARRCC is therefore interested in the way that banks invest people’s money." (Read the full letter to Westpac.)

Ethical superannuation

While advocating to our banks about how we would like them to make us of society's collective savings can seem hard, there is much easier, and often more effective action that we can take to ensure that our money is having a positive impact on environment - our superannuation. For many people, their super is their biggest asset aside from their house. And with Australians compulsorily allocating 9% of income into super, the average Australian has $40,000 in superannuation. This equals about $1.4 trillion invested on our behalf by superannuation funds. With the choice that all Australians now have regarding their super fund and investment options, it is easier than ever to invest our money ethically.

About ethical super

Many super funds now offer an ethical or socially responsible investment option, which means that you could make a small step to investing your super ethically, simply by calling your super fund and switching to the new option. (if you have multiple super funds, perhaps from previous jobs, it might be a good idea to roll over all of your funds into just one - this means that all of your money will be invested ethically and you'll save on fees. Your chosen super fund will usually have a simple process to help you do this.)

However not all "socially responsible" options are created equal. The Responsible Investment Association of Australasia (RIAA) have a certification symbol for ethical investment companies, but currently in Australia the bar is set fairly low to be certified - you just need to invest as ethically as you say you will. Putting the time into a bit of research on superannuation funds and options can ensure that the way your money is invested aligns with your values, socially and environmentally.

Read an article by Australian Ethical on the benefits of ethical investing.

How to check

According to Australian Ethical Investment, there are two key things to check to see how your super fund performs on ethical, environmental and social issues. The first thing is to check what ethical or environmental criteria the fund uses when choosing their investments. This information should be in the fund's product disclosure statement (PDS) or on their website.

The most important thing to check is the super funds portfolio. This way you can see that the companies the super fund is investing in actually match the sort of companies you'd like to support. Not all funds disclose their portfolio, but some of them do. If your super fund doesn't provide a full portfolio listing then you can never be truly sure that the companies they invest your money in are ones you actually want to support.

Options

There are many options out there:

• Australian Ethical, a sponsor of ARRCC in the past, is one superannuation fund that provides options for investing your superannuation ethically. They provide information on what ethical investing is, have a Charter that they use to guide thier investment decisions, and publish a list of companies they invest in and what each company does.
     
• Religious super funds include: Catholic Super, Christian Super, Salic Super (Islamic)
     
• Choice Magazine, an independent advocate for consumers, has an article comparing a number of ethical funds with information on how to choose.

ARRCC encourages you to look into how your super and other money is invested and make a change to an ethical option, so that you can be sure that your money is being used to support those endeavours in line with your values!