Green investment diary
One writer’s attempt to discover the ways of sustainable investing
I didn’t know much about green investing, so I set out to record all that I could learn about it in one week. My journal entries are below. What I expected wasn’t what I found at all. I thought I’d need several thousand dollars waiting to be invested to make any sort of an impact and I braced myself to be inundated with yawn-inducing, dry financial material. Instead, I learned little me can make a big difference. And I was once again in awe of the power of knowledge.
April 30I perused online to get a good idea about the basics of green investing today. The pros call it Socially Responsible Investing. I found several SRI mutual funds—those that purchase stocks and bonds in a variety of companies that engage in socially responsible principles and practices. To qualify, companies are filtered through social screens, criteria is established to accept or reject them in the world of social responsibility. Kinda sounds like The Scarlett Letter. I ended up on this great site, www.socialinvest.org, which lists several green funds and charts-out in easy-to-read fashion what social screens they subject companies to and which ones they ignore.
Oh, and rates of return appear to rival those of my own low- to moderate-risk traditional investments— roughly 6 percent to 10 percent based on terms. I’ll have to see what the experts say about performance.
May 1Back online today. I came across community investing, an element of SRI that can have a huge impact on the quality of people’s lives locally and abroad. It involves banking with a credit union, or what’s known as a community development bank. I knew that credit unions cater to the financial needs of lower-income individuals, but what I didn’t realize is that it goes deeper than that. To make money, financial institutions invest your money. And it’s how they invest your money that matters. I had no idea that the choice to put my money in one “bank” over another could make such a difference. Visit www.communityinvest.org and click on “Impact Section.” I’m not going to spoil the exciting ways your money can make the world a better place just by depositing it in a “responsible” financial institution; you can check it out for yourself. Visit Coopamerica.org, too.
May 3I knew blogs had to be big in green investing, but I didn’t know which ones I could count on, so I turned to my favorite environmental magazine, E, and looked up articles by its financial green wizard, Roddy Scheer. His name’s almost as fun to say as Sooty Shearwater. He agrees. Some of the hottest tips and insights come from what he called the new grapevine: blogs. Here’s a few he recommends: www.greenthinkers.org/blog, www.commonsblog.org, deconsumption.typepad.com.
And books? Scheer mentions Investing With Your Values: Making Money and Making a Difference, by Hal Brill, Jack A. Brill and Cliff Feigenbaum.
May 5I plopped down in the investing section at Barnes & Noble today. I didn’t find a single book on green investing, but I learned something important from Eric Tyson’s Investing for Dummies. I don’t think I fully appreciated the power of knowing what social screens a company uses to select socially responsible stocks and bonds until I read Tyson’s advice. He showed me in the following example that even in green investing, not everyone sees eye to eye. McDonalds, home of Happy Meals, is a stock selected as part of several socially responsible funds. Huh? Tyson explains that McDonalds’ commitment to community charities, recycling, women and minorities give it a gold star as a socially responsible company. Personally, I’ll never invest in McDonalds until they commit to humane treatment of animals and some resolution to deforestation of land, water consumption and methane-gas production. Humf! So I get it why I should care which social screens a company looks at.
Oh, and Nancy Dunnan, one of our nation’s leading financial advisers, vouched for the Web site I found on my first day, www.socialinvest.org, in her book How to Invest $50 - $5,000.
And the experts concur: Green investing is good for your wallet and the world. As a whole, green mutual funds balance performance with socially responsible practices. Nice.
May 6Weeks ago, I stumbled upon a program on PBS about Kiva.org, a San Francisco-based, nonprofit organization that works with established micro-credit lenders around the world to provide loans to entrepreneurs in developing countries. The funds come from lenders like you and me, everyday Americans who want to make a difference in another person’s life. I absolutely love Kiva.org’s unique approach to micro lending: lenders select the individual entrepreneur they loan to. So my boyfriend, Chris, and I selected a woman who runs a simple business that complements our values. We provided a portion of the loan she needs to improve her tools and we get to see the progress she makes, as a result of our loan. We’ll be repaid, though we won’t make a profit. We’ll simply use the repayment to invest in the quality of another human being’s life. It is an investment worthy of MasterCard’s motto: priceless.