News and Analysis | David Macdonald | March 21, 2022

Putting your money where your morals are

At Path, our purpose is to encourage people to properly consider where their money is invested, and whether or not their savings are driving positive change for the people and planet.

Since the beginning of the conflict in Ukraine, we’ve seen our enquiries almost triple. In the wake of a humanitarian crisis, people look to ensure their money supports their ideals. They are keen to divest from any controversial investments that are at odds with their values, and have concerns about any economic impact and the effect on their savings. 

It’s also interesting to see the results of a recent poll from Make My Money Matter, which found that 86% of the British public believe that their pensions and investments should not be invested in Russian interests*.

With this in mind, we’re asking customers to consider doing the right thing with their finances. We’ve put together a collection of questions and considerations to highlight with your Financial Adviser: 

  • What percentage of your portfolio is connected to controversial holdings? Your provider should be able to tell you how exposed your portfolio is to any investments that don’t align to your values.
  • What are they doing about controversial funds? Do they already have a plan in place to divest funds? If not, why not? Providers should be looking at this from both a moral standpoint, and in terms of the financial risk involved with particular investments. Check exactly what your provider is doing, or planning to do.
  • Where else is your money invested? Consider your priorities and which areas you want to avoid – it could be fossil fuels, mining and extraction, arms or tobacco. Your provider should be able to provide a clear picture of whether your portfolio is exposed to any exploitative or extractive industries.
  • Can they offer you one-to-one advice? Pensions are likely to be hit by this conflict. Your provider should be able to speak to you directly about your individual needs and concerns, and then review and adjust your plans accordingly. 
  • How will the war impact my pension? The initial economic shock of the war will inevitably hit pension investments; but your provider should encourage you to be patient. Your provider should be advising you against a ‘knee-jerk’ reaction.
  • How many of the investments they make on behalf of their customers are aligned to UN SDG Goals? This is a collection of 17 individual goals designed to be a blueprint for a more sustainable future. The aim is to ensure that the most pressing issues our planet faces – poverty, education, equality and climate action – are at the forefront of how we live.
  • How will changing my portfolio affect its performance? If your provider suggests that aligning your finances with your morals means having to sacrifice performance, then alarm bells should start ringing. That is simply not true.

This is a time when people are looking closely at their finances rather than neglecting them. We’re encouraging investors to think about the impact that their money has on the wider world, and whether their finances are aligned with their own personal values.

Financial firms should be displaying moral leadership and offering sound financial advice – don’t be afraid to really ask some of the hard questions to hold them to account.