How green are your investments? Two new platforms will help you assess your ESG levels

Two new platforms will launch this year to help investors assess how green their money is. Isitgreen.org and SwitchIt are two independent platforms that’ll flag how climate-friendly your investments are. 

Isitgreen.org will launch today and allow you to check how green your pension savings are on a scale of 1 to 5 stars. It’s a partnership between Good With Money, a responsible money website, and Demos. 

SwitchIt will launch in October and aims to check a wider investment range for environmental impact. The platform assesses banks, energy providers, and pensions for their climate impact. It also offers you the opportunity to switch to greener alternatives. 

The platforms help fill the information gap within ESG investing. Currently, the only information source on how green a fund is comes from the provider. If they fail to offer such insight upfront, you’ll stay in limbo on their climate credentials. 

According to Triodos Bank, seven out of 10 people believe their financial providers should be more forthcoming on their money’s ESG impact. That shows that most UK investors are worried that their providers are either greenwashing or unclear about the actual damage they’re causing to the environment. Another report showed that more than 65% of UK savers want their money to have a positive impact on climate change while driving profits. 

Isitgreen tries to achieve that by helping investors find the kindest pension funds on the planet while preserving future financial returns. To reach its star rankings, the platform relies on the CDP’s Climetrics database and financial information from Refinitiv. CDP is a non-profit charity that offers an environmental impact disclosure system for investors, states, cities, companies, and regions. Refinitiv is owned by the LSE Group and provides the world’s largest financial markets data. 

According to Lisa Stanley from Good With Money, UK pension funds are a gold mine worth £2.6 trillion. So, if we aren’t careful, they’ll continue to be invested in misalignment with our values. Stanley added that pensions have long favoured tobacco, deforestation, arms, and fossil fuels as core investment sectors. 

So, it’s important to direct those investments to more sustainable areas to help achieve a greener future. Still, it’s been tough to find the appropriate areas to invest in. An analysis by Make My Money Matter showed that a greener pension is 21 times more effective than going veggie, giving up flying, or switching your energy provider combined. 

Founders of SwitchIt ran small pilots and showed that many lifetime deposits already switched to sustainable providers. One founder, Sophie Cowen, mentioned that despite the Paris Agreement, 35 banks pumped $2.7 trillion in fossil fuels. That highlights the importance of checking an investment’s green credentials. Nordea Sustainable Fund research shows that cutting fossil fuel investments improves your carbon footprint 27 times more than doing individual endeavours, like switching food categories or public transport. 

Both platforms will help investors choose to put their money in the companies that are making a difference to improve our carbon footprint. To invest in ESG, get in touch with one of the financial advisers from our directory.