The sea was literally on fire, floods wiped out villages and subways, wildfires burned towns, and in most of the US it is too hot to even go outside. It is probably time we stop funding climate change.
In regard to sustainable investments, most of what we hear is that we can divest from fossil fuel companies, and it’s true, we can. However, this is not the only thing we can do. Impact investing offers us tools and solutions to invest for a better world.
Once you divest from the “bad” you can also invest in the “good.”
You might consider an investment such as the TIAA-CREF Core Impact Bond Fund. The TIAA-CREF Core Impact Bond Fund (TSBIX) is an actively managed core bond fund that invests in securities that demonstrate environmental, social and governance (ESG) leadership and/or direct and measurable environmental and social impact. The fund invests in two environmental sectors, renewable energy and climate change, and natural resources. This can include investments in new, expanding, or existing renewable energy projects (including solar, wind, and small-scale hydroelectric), energy efficiency projects resulting in the reduction of greenhouse gas emissions, land conservation and sustainable forestry, fishing, and agriculture, certified green buildings, remediation and redevelopment of polluted or contaminated sites, and improvement of clean drinking water supplies and/or sewer systems infrastructure, waste management projects.
Some of the fund’s recent holdings include:[1]
-Bay Area Water Supply and Conservation Agency
-Ohio Air Quality Development Authority
-CarbonLITE
-The Rockefeller Foundation
-The Conservation Fund
-Florida Hurricane Catastrophe Fund Finance Corp
-The Nature Conservancy
-Mosaic Solar
You might also consider investing in the Pax Global Environmental Markets Fund. The Pax Global Environmental Markets Fund (PGRNX) is a climate change solutions fund that invests in new energy, water, waste and resource recovery, and sustainable food, agriculture and forestry. The fund is fossil fuel free and includes companies such as Waste Management (WM). WM is the leading private player in the US refuse and recycling market, with a 22% share of the industry and more than 21 million customers. It has been named to Fortune’s “Change the World” list, which includes companies that have made a sizeable impact on major social or environmental problems. WM is transitioning its truck fleet to natural gas to reduce emissions and deploying technology to increase route and operational efficiency. Innovative projects include methane emissions capture, next-generation landfills with accelerated decomposition technology, re-processing and recycling of older landfills, and next-generation recycling plants with sensor or automation-based processes.[2]
Another fund holding, Xylem, is a leading water technology company committed to "solving water" by creating innovative and smart technology solutions to meet the world's water, wastewater and energy needs. Xylem’s technologies and solutions use less energy, and also promote sustainability.
As of Q1 2021, a $10 million investment in the fund had an impact of:[3]
-1,240 MWh of renewable energy generated or the equivalent of 110 households’ electricity consumption
-160m gallons of water provided/ saved/treated or the equivalent of 1,210 households’ water consumption
-2,220 tons of materials recovered/ waste treated or the equivalent of 1,070 households’ waste
The moral of the story is don’t stop at divesting. Our investments offer us the opportunity for a better world, and sustainable investing is also just better investing. “Individually, we are one drop. Together, we are an ocean.”– Ryunosuke Akutagawa
GIVE is a community that makes sustainable investing accessible to all through online courses, consulting, and a soon to be published book. To learn more about how to invest sustainably visit www.give.how.
This shall not constitute an offer to buy, sell, or solicit securities. All information provided herein is for informational purposes only and should not be relied upon to make an investment decision and does not intend to make an offer or solicitation for the sale or purchase of any specific securities, investments, or investment strategies. Nothing contained herein constitutes investment, legal, tax or other advice nor is it to be relied on in making an investment or other decision.
[1] https://www.nuveen.com/en-us/mutual-funds/tiaa-cref-core-impact-bond-fund?shareclass=Advisor [2] https://impaxam.com/products/thematic-equities/leaders-strategy/pax-global-environmental-markets-fund/ [3]https://impaxam.com/assets/pdfs/factsheets/fact_sheet_globalenvironmentalmarketsfund.pdf?pwm=5120