How sending this one email could be 27 times more impactful for the environment than flying less, eating less red meat or cycling to work.

Unless you’re hiding under a rock, you probably know that climate change is a huge issue facing our planet. Chances are you are already doing what you can to make a difference.?

Changing where you shop, not wasting electricity, using a bag for life and being mindful about meat consumption are all ways we can, and should, contribute. If you’re more engaged, you might even be joining protests or writing to your politician.

But what if I told you that if you’re in full time employment, or about to start, you’ll have a secret power that could have more impact on the future of our environment than everything you’re doing now as an individual, combined.?

It’s also something you can leverage for other issues you may care about, such as social inequality, human rights or slave labour. However, the majority of people don’t know they can use it in this way.

It’s not something you can see, or touch, and I bet you don’t pay it much thought: It’s your pension.

Even if you don’t have a pension you’ve arranged yourself, you’ll have a workplace pension set up by your employer which you are auto enrolled in unless you choose otherwise. A portion of your salary is paid into it each month and your employer may match what you pay in too (which is effectively a pay rise for your future self).

Right now, it might feel like a ‘retirement tax’ of sorts when you spot it on your pay check - money you won’t see until the distant future when you’re old and grey, taken from your wages before they even hit your bank account.?

For most, a pension is not something exciting to think about, or that you’re particularly engaged with, or that you can ‘spend’ now.

Or can you?

Your money makes the world go round

Just because you can’t spend your pension pot in the traditional sense today, doesn’t mean it’s not being ‘spent’ on your behalf at this very moment. Those decisions are being made by other people in suits, in an office miles away, who you’ve never even met.

Money makes the world go round, and it’s your money being used to fire the engines.

Any time money is put into an account where an investment is made, for example a stocks and shares ISA or your pension, a team of people at that bank or organisation decide which companies or industries that money is invested into in order to grow it best.?

Your money is effectively ‘spent’ by buying a small slice of the company, a share. As the company does well, you receive a portion of the profits equivalent to your slice, which is how you make ‘financial returns’ and how your money grows over the years.

The money in UK pensions was ￡6.1 trillion between 2016 - 2018, and the workplace pension you’ll have a right to is valued at billions per year - a huge amount of money, which is used by companies and industries in order to keep innovating, expanding, hiring and profiting. Your money will likely be funding entire industries, such as renewable energy, technology and businesses you’ve never heard of, as well those you have, like Apple, Disney, Google, Nike and Unilever.?

They all need this money. They are using it for their own growth.?

A lot of them are larger and more influential than some small countries, responsible for hundreds of thousands of employees and billions of pounds worth of resources both now and, crucially, in the future.?

The actions these companies and industries take now will have a huge immediate and future impact on environmental issues, far more than we can ourselves: Getting one person to boycott plastic is good, getting one global company to stop selling it completely is a whole different ball game.

Money talks, and your pension is a loud-mouth?

Up until recently, the focus of investments has been about financial returns and that alone, but as the world has woken up to the severity of the global environmental crisis approaching us so ‘responsible investing’, known as ESG, has become more of a priority, both for the planet and for our pockets.

ESG stands for environmental, social and governance and its been around for a while now. When it it comes to ESG investing the gold standard is two pronged.?

It directs money into high performing companies that achieve profits by conducting business in the way most of us expect from businesses today - i.e. not winning at the expense of our planet, or people, and doing ‘good’. And it also engages with businesses in the sectors where innovation and change will have the largest global impact, for example oil and gas to help them transition to renewable energy companies that build our wind farms in the north sea and build electric charging stations to power our electric vehicles. .?

Responsible investing effectively rewards corporations that are doing business in the new way; being an ESG leader is about delivering profit while creating a more sustainable future.?

No one can deny that the old system of doing business - at best naively ignorant to the future effects of its actions - has negatively impacted the earth.?

The pension investments of people like you, who are funding these businesses, can be pointed in this new direction, and that’s powerful.

Shifting all your collective workplace pension investments - billions of pounds a year - away from companies doing business in the old way, the way that won’t leave us with a planet we want to live in in 50 years’ time, and towards companies that are making changes to the way they work in order to move the dial on their environmental impact, does three extraordinary things.

1. It forces companies with a negative impact to readdress their way of working, and make changes for the better. Money talks, and reducing this crucial supply of cash is how to have a seat at the table and get the leaders, capable of making huge changes, to listen.
2. The sustainable and ESG leading organisations ‘doing good’ are given a financial boost. There are companies like this in all sectors, and the extra money creates a greater and quicker impact and helps them to outlast those that don’t make critical changes to save the planet quick enough.?
3. Delivers strong returns for you the investor; the companies ‘doing good’ are also big players. They are the cutting edge and exciting businesses like Microsoft, Nike and Volkswagen, as well as smaller corporations, and have better long-term growth prospects since they are, by nature, much more sustainable. They are likely to be worth far more in years to come.

It takes less than a minute to have your say

You could write an email to the CEO of one of the businesses you think should be doing more for the planet. But this email to your HR team or pension provider will be quicker, and more impactful:

Hi there -

I want to invest my workplace pension in a responsible way to ensure when I retire and get my pension its in a world worth living in. I want to understand how you/my pension provider is engaging with the businesses you invest in. Both on ESG issues to ensure a more sustainable future, and are they invested on the right side of climate change.

Thanks

Rob

Your pension contribution helps the world turn. It is a powerful voice - a vote - that you’re probably not using, instead letting other people use it to speak for you.

Changing how the world turns is a big task, but in this space when things move, they move quickly. Today there are more electric charge points in the UK than petrol stations, five years ago that was not the case, ten years before it was almost inconceivable.?

Imagine if every person with a pension today sent this one email. The shift could be seismic. But while the more people who vote with their feet (i.e. finances), the more impact there’ll be, even just your change can have a huge effect; over the years your pension money will be 27 times more impactful for the environment than if you fly less, eat less red meat or cycle to work, if it is invested more responsibly and sustainably.?

Like wealth, change is created in decades and not days. The time is going to pass whether we like it or not, so take charge of what other people are doing with your money now and by the time you actually get to spend your pension, hopefully the planet will be in better shape because of one small email you sent 30-40 years ago.

“Unless Someone Like you Cares a Whole Awful Lot, Nothing is Going to get Better. It’s Not.” — Dr. Seuss