This article is dedicated to those who would like to invest in solutions to waste and energy overconsumption. This question is becoming more and more baffling to me personally. As a functioning worker, exchanging my labor to gain currency in order to one) purchase things to sustain my life and two) to put aside in savings/investments to be used in future purchases, I am quite frustrated that there aren’t many proper investment opportunities for investors who look to finance and invest in truly“green” and“sustainable” projects.
* Disclaimer: I use the word “green” and “sustainable” in quotes as a substitution for “(projects/companies) aiming at reducing the environmental impacts and/or enhancing the well-being of human and other living things”, which could be a bit long. If you are allergic to these words, I apologize in advance.
Why are investments and savings such an important discussion?
The graph below shows extremely interesting stats when it comes to the carbon footprint: you can lead a zero-waste life, eat local, ride your bike for short distances, etc… yet the three most impactful things are “ethical” jobs, “green” savings and vegetarian diet respectively. You can ride your bike to work at JP Morgan Chase, the number 1 investor in Oil&Gas in the world, but it won’t balance things out much.
It is important to note here, that both individual efforts/commitments and those from industries, businesses, and policymakers are important to fight against climate change and environmental degradation. Yet, it seems that we are not addressing enough from the latter.
In this article “The carbon footprint sham” or this article “Why Oil companies care so much about your carbon footprint”, the authors point out that “carbon footprint” was such a successful PR campaign from big industries, in a way that “the real message (behind the term “carbon footprint”) is that pollution is your problem, not the fault of the industry mass-producing cheap bottles.” Oil companies were early adopters and advocates of the term “carbon footprint”. BP, for example, unveiled their first “carbon footprint calculator” in 2004 so that one could “assess how their normal daily life — going to work, buying food, and traveling — is largely responsible for heating the globe”.
Our daily activities are, in effect, responsible for climate change and environmental degradation. Yet one should also pay attention to the much bigger polluters out there. Questions such as “to which company/project – which have certain direct environmental/socio-economic impacts – should I give my labor to?”(“ethical” job); or should I invest in?”(“green” investment). Therefore, are systemic and hence impactful questions one needs to ask themselves.
At this point, we can push the exercise further by re-examining our current capitalistic economic model. For example, Christian Felber, initiator of the movement “Economy for the Common Good”, suggests the annulation of the whole financial system, as it was designed by default for overexploitation and injustice. As our current financial system is a failure of design (sorry for the self-reference), it is almost impossible to invest in a fair and sustainable way. However, given that the current system continues to exist at least in a short term and given that individuals continue to invest/save up through different financial vehicles, what do we do?
“Green” investments and savings: the struggle is real
There are two camps when it comes to “green” investments in general. The first camp is all about creating and/or financing new“green” projects. The conviction is often that “because it is quite impossible for established businesses/projects to truly make a switch towards more sustainable practices, we’d better create/finance completely new ones.”
Some examples of this camp are individual-to-business crowdfunding investment platforms (ex: October, though not all of their projects are “green”), investment funds that aim at creating new “green” startups and projects (ex: Time for the Planet, CardaShift) or investment platforms focusing on new renewable energy projects (ex: CitizenEnergy in Europe, or Wunder Capital in the US).
The other camp, on the other hand, continues to finance/invest in established companies/projects which have shown some willingness or commitment to tackle the environmental shift. These companies can be found on “green” investment platforms such as EarthFolio or OpenInvest (now bought by J.P Morgan); or on traditional small-cap markets. The conviction of this camp is often that “creating new projects would take a lot of time and energy, while changes can be made right from existing structures, which would have massive impacts”.
Indeed, these two camps and convictions are not mutually exclusive. Often than not, motivated investors invest in both endeavors. Better late than never, “green” investments are rapidly emerging as a necessity to growing demands, no longer just purely an interesting option.
But one must be careful of the complete falseness or voluntary deception. When googling “best green stocks to buy” or “environmentally-friendly investments”, I came across this article from TIME on “How to invest in companies that are actually helping the environment” and almost got a heart attack reading that Microsoft and Google are already "carbon neutral”.
Two companies that came up in conversations with multiple fund managers were Microsoft and Google. Both are already carbon neutral. Google has eliminated legacy carbon, and Microsoft has a plan to do the same by 2050. “Their initiative is to remove everything that they’ve emitted since they started, and hopefully that leads to other companies taking a similar approach,” said Iyassu Essayas, director of ESG at Parnassus.
If an established media outlet such as TIME could write these complete absurdities – in which a company can spend millions and billions of dollars buying the right to pollute through carbon offsets, we are not going to move forward in the right direction.
Regarding“green” savings, the scene looks equally gloomy. Indeed, there exist already quite a few “sustainable” saving accounts proposed by established banks, but these also finance Oil&Gas projects in parallel for convenience. I, too, am one of the many who put some of their savings in a Sustainable Development account, which at a closer look is not “green” at all. This comes with no surprise. According to the NGO Reclaim Finance, 94% of Socially Responsible Investment (SRI) funds feed into “companies with highly questionable environmental and social practices” and include Oil&Gas major companies whose own a “good ESG rating” due to a tiny proportion of their business dedicated to renewable energy.
It is safe to say that truly “green” savings are pretty much non-existent in Europe at this point of writing. There are these NS&I green savings bonds, launched in summer 2021 in the UK, which seems to be one of the first public, seemingly truly “green” savings, ever.
“Green” investments: some ideas worth looking at
In this part, you will find several interesting “green” investment areas to be put under your investment radar. Please note that this is not a list of companies/projects to invest in – not that I was trained as a financial analyst, nor do I have a license to give such advice.
This is simply a list of highly potential“green” technologies/practices worth following, in my opinion. I’ll list the resources that come with each technology/practice for further references, without elaborating much on them. I invite readers to visit the resources for themselves, in areas that might be of interest to them.
- Circular building, as we mentioned in the first half of our article “Build our house the way we build LEGOs”.
- Alternatives to cement, such as ashcrete, recycled plastics, hempcrete, ferrock… as mentioned in this article; or blast furnace slag, micro silica, papercrete, concrete debris, post-consumer glass as mentioned here.
- “Green” steel made with a hydrogen production process in Sweden, which is becoming a new hype according to Roland Berger.
- Passive house as we discussed in our article “Better ways to heat places in a temperate climate” or Positive energy building.
- Geothermal, solar, and low-tech heating for houseshold heating, as we discussed in our article “Lesser-known renewables”. A successful drilling geothermal project led by ENGIE lately that could supply heat for 12 000 households in Paris region gives out much hope for geothermal energy on a large scale.
- Geothermal for industrial heating, on which Vox made an extended analysis calling for Oil&Gas to adopt this new technology in order to survive the renewable age.
- Waste heat valorisation from industry, as mentioned in this list of EU research projects made by Flux50, a Flander collaboration platform in Belgium, or experimented and explained in this research paper of École Polytechnique de Lausanne”. It seems like this matter still stays in the research realm, without actual industrial success stories.
- Reusing and recycling of rare metals, whose necessity is discussed here on The Conversation, with industry examples listed here on Recycling Today. We also discussed the problem of electronic waste in one of our articles.
- “Zero extraction” batteries, meaning batteries using recycled materials from previous functioning ones. In this article on Chemicals and Engineering News, the author discussed the challenges, the newly developed methods and ongoing projects related to this.
Agriculture & Food
- Micro-farming, biointensive agriculture, or permaculture as a new dominant agricultural mode, replacing intensive and monocultural agriculture of our time. In a previous article, we also discussed forest gardening, which is a form of permaculture.
- Plant-based diets and/or eating down the food chain. We explained the idea of eating down the food chain here in our article “Overfishing”, which can be understood as eating scallops, seaweeds, insects, plants. There has been a myriad of startups and local initiatives working on this matter so I’ll skip the mention.
- “Zero new” marketplaces. The marketplaces/platforms that promote the use of existing products instead of newly produced ones. The best projects to back are your local thrift shops or upcycling shops, the second best are probably companies such as Vinted (second-hand clothing), LeBonCoin (second-hand everything in France), Kiwiiz or Bricolib (peer-to-peer machinery and equipment exchange in France), HomeExchange (peer-to-peer house exchange), Industrious (creating co-working space in existing buildings), etc.
- Backing public transport to reduce the number of individual vehicles, there are also projects such as Midnight Trains or RailCoop in France, which are making trains look sexy again.
- Sailing as modern maritime transport, as we explained and listed some companies here in our article “How to enjoy exotic flavors without leaving a huge carbon footprint”. Lately, I also signed up for trips organised by Sailcoop, a French commercial sailing company for tourism purposes, and can’t wait to test it out.
- 2020 marks the end of the UN Decade on Biodiversity, and almost no large-scale changes in business and social practices related to biodiversity were virtually observed. Meanwhile, biodiversity loss is one of the two existential crises of humanity, along with climate change. And as explained in this article in the New York Times “When you have two concurrent existential crises, you don’t get to pick only one to focus on — you must address both no matter how challenging.” more drastic measures from policymakers, big pollutors and industries must be taken to protect and preserve biodiversity.
- The interests & challenges of biodiversity investments are explained here in this article of UNCCD “Finance for nature”. It is only the beginning of biodiversity being discussed as an existential crisis in our societies, but it is the right time to look at how to reverse the damages that have been done.
That’s the end of this non-exhaustive, personally biased list.
Future Thought Leaders is a democratic space presenting the thoughts and opinions of rising Energy & Sustainability writers, their opinions do not necessarily represent those of illuminem. This article was also published on Waste is a Failure of Design.
Anh Nguyen is a Co-founder of StimShift, she produces, analyses, and studies in the field of disruptive innovations and innovative designs for the environmental shift. Outside of StimShift, her personal research focuses on alternatives for production, consumption, and lifestyles that are less energy-intensive and less waste-inducing. She writes about this on her blog Waste is a Failure of Design.