"While consumers regularly recycle and are happy to pay more for ethical products, like fair-trade coffee and organic food, they ignore their basic values when it comes to banking choices." (Alex Gardner)Although we are often aware of the ethical impact of the products we buy, the social and environmental effects of the money we invest in our bank accounts/pensions/shares/mortgages are less visible and therefore often overlooked. Financial institutions invest our money into various projects and businesses. Your money could end up financing projects and companies that degrade the environment, fail to uphold human rights and animal welfare or are part of the arms trade. Certain banks are also known to provide services to oppressive regimes.Barclays, HSBC, RBS and Standard Chartered have all signed up to the Equator Principles, committing themselves to subjecting all project finance applications over $10m to an environmental risk rating. However, there is no meaningful commitment to disclosing how they perform.Ethical financial institutions work in two ways to provide an alternative. They may choose to completely avoid businesses whose actions or products harm the environment. Another approach is ‘socially responsible investing’ (SRI). This means avoiding blacklisting, and using ‘positive’ means to create change by investing in industries that are doing the most to improve their business practice.Actions

• Do your research. Read the ethical policy of various banks. Use the ‘Ethical Investment Research Services’ online to understand the issues and research your current the environmental/social record of the financial institutions you are using. Think about what you are happy for your money to finance. What kind of projects/businesses do you want to support and which do you feel unhappy with?
• Write a letter to your bank/building society/employer making them aware of your stance and asking how they propose to answer your concerns.
• If you can, transfer your money to an ‘ethical’ bank such as Co-op, Smile, Triodos and Ecology.
• Spread your new found awareness to family and friends

Further InformationEthical Investment Research Services – www.eiris.org The Co-operative Bank - www.co-operativebank.co.uk Smile Online Banking - www.smile.co.uk/whysmile Triodos Bank - www.triodos.co.uk Ecology Building Society - www.ecology.co.ukNature Save, Ethical Insurance - www.naturesave.co.uk Content supplied by Carolyn O'Hanlon