#27 | Sustainable banking and investing for the planet

In this episode, we go beyond the immediate impact of our daily purchases to talk about the impact of the money we have in our savings, investments, and pensions. While banks have traditionally been part of the problem by financing fossil fuel projects and not prioritizing sustainable investments, this is beginning to change.

Banking investments can have a significant impact on promoting sustainable development and combating climate change. But do we go for a green bank or stick with one of the major players? Why do we make the banking choices we do, and how do we overcome difficulties in changing banks?

Grab some tea, get comfy, and hit that play button.

Links and resources:

Article | The Role of Banking in Climate Change
Article | Banks and Climate
Article | Why your banking habits matter for the climate
Article | Why are banks key enablers in fighting climate change?
Article | Stop Banks Funding Climate Chaos
Article | Ethical Banking: Top Socially Responsible Banks - Forbes
Article | Ethical Banking - Overview, Characteristics, Pros and Cons
Article | Ethical Banking: What Are Socially Responsible Banks? - Nerd Wallet
Article | Ethical Banks & Current Accounts - Ethical Consumer
Article | 11 Ethical & Socially Responsible Banks
Bank | Triodos Bank
Investing | Wealthfront

Transcript

Note: This transcript is mostly unedited.

Brandee   0:05  

It's not easy living on a dying planet. But it is easy to feel overwhelmed when it comes to making changes and taking action to try and save it. Where do you start? Is it even worth it? Can you really make a difference? Welcome to The Tea on Sustainable Living podcast, where we attempt to answer these questions by spilling the tea on living sustainably in a world that's going to shit. I'm Brandee.

Hannah  0:26  

And I'm Hannah. And for years, we've been navigating the big messy gray area of caring about our planet. It hasn't always been smooth sailing, but we're not giving up yet. So brew yourself a cup of tea, get comfy, and let's try and navigate that gray area together.

Brandee   0:45  

Hello, Give-a-Shitters. This is Brandee.

Hannah  0:48  

And this is Hannah and you're listening to The Tea on Sustainable Living podcast.

Brandee   0:54  

Which episode? Number 27 Yes. Welcome to Episode 27.

Hannah  1:02  

I'm a little bit sleepy.

Brandee   1:04  

We both are. I have my cold leftover pizza from our dinner last night. Oh, I like your coffee mug.

Hannah  1:10  

Thank you go Woody. got inspired. Got it in the Sagrada Familia.

Brandee   1:17  

Oh, nice. I think I was just talking to someone about that the other day, it's finally going to be finished soon. Right? They have.

Hannah  1:23  

Yeah, it's I think, Well, I think it was supposed to be 2026 but in a pandemic happened. But I think it is. I mean, I went when did I get I went last year. And I mean, they still had quite a lot to do. But it was also very like inside it felt pretty complete. I think they had like two towers to finish and then the like front porch, which is a slightly weird one because basically they have to move people out of housing to build it and the people who own or rent those housing know that it was like part of their contracts when they like either bought or whatever that housing it was like built in that like and they got like they paid a lower price because at some point they would have to move out but that's like the last thing to be built because they have to like didn't like kick people out or you know yeah, you know apply the apply the contract

Brandee   2:22  

apply the previously agreed upon, right in

Hannah  2:25  

the like 70s or whatever 70s 60s or 70s because obviously when it started to be built it was just like kind of like there wasn't really anything built around them anyway, but I'm fabulous yeah

Brandee   2:36  

stay tuned for a future episode because I think we're gonna talk about travel soon in like EXIF like local or like heavily pop like tour heavily tourist places I don't know how to say that.

Hannah  2:51  

Tourists anyway whatever.

Brandee   2:53  

And Barcelona Yeah, we'll probably come up so anyway stay tuned. Today however we're talking about thinking and investing. I think I had this noted down while ago and then I kept saying like episodes that it kind of like it kind of came up a little bit like remind me remind me remind me Windows episode. So this I think was primarily sparked by like there before I even moved to Spain. I knew there was a bank I wanted to switch to called Triodos Bank which I think they're actually a UK bank that hasn't heard of them here. Or maybe they're I don't know if I'm getting that getting that right if they're based like they are based somewhere European bank as is the their like primary location but they've won like all these like awards. Like British awards for like banking and being like they call themselves one of the world's most sustainable banks. They finance things like renewable energy, sustainable farming, education, charity, social housing, they don't finance vessel, excuse me, fossil fuels, fast fashion, weapons, tobacco deforestation, so I wanted to they had branches in Spain and I knew I wanted to try to switch to that when I moved here just to I don't know put my money somewhere that finances these good things it doesn't finance these bad things. But I struggled a lot to switch the like first summer I moved here I didn't know how to make you yet so I don't know if I like ever told you like my struggles of this like going to the branch to try to open an account and I didn't really understand like, why wasn't like an easy Yeah, like go ahead and open this checking account, I think also known as a current account. So I went back multiple times to try to understand like, what the issue was and I would bring like my passport and I would bring this document and I just didn't really understand why we're having such trouble giving me an account but I think basically it's it's because I'm a foreigner because we're not Spanish and that I don't know they're certainly Like rules, I guess you have to follow when someone like a foreigner open an account. And I tried again, I thought I figured out what that was because my, the bank I am with had me fill out like a certain form. I think it's specific to like Americans having foreign accounts. So then I went back to Triodos like, Hey, I think I know what the issue is, like, I have this form that you need me to fill out and, and she seemed more like, like, she opened like this big like, kind of, like binder of like this reference binder, and seem to be like, okay, like, I think we can do this. But she was like, you don't need to fill out this form, or are you sure I'm pretty sure I need to fill out this form. So we left I think she was going to reach out to someone and get back to me. And then I came home to an email that was like, Can you fill out this form the form that I needed to fill out? So I did and then I was just ghosted, like she just never responded. So I gave up because it's one of the things Yeah, like the people that use the option because like jumping through hoops. So yeah, actually, like sit down and see what like kind of what impact the money in your bank account like do have on you know, that like that shortlist of things that they don't like finance or invest in. But then also that kind of led me to like investing. Right? Yeah, I thought we just talked about what

Hannah  6:22  

pensions as well, I

Brandee   6:23  

guess. Yeah. Yeah. Have you have you ever thought about because we talk about like, spending money and kind of voting with your dollar on when you can where you can but yeah. Have you ever noticed like, where you keep your money like your bank accounts and your investments and pinion?

Hannah  6:38  

No, not especially it's a really good point. It's an interesting thing. I mean, I have but in a different I have but haven't done anything about it and in in different contexts, which is I grew up in a somewhat Quaker family so Quakers are generally pacifists. So with one of their big things is that they don't want to you know, it comes up in conversation that they don't want to be heard having money or mortgages or pensions or whatever, with companies that with banks that will invest in arms trade, which is another big area that a lot of banks do invest in, in arms. So I've heard about it talked about within that context. And that's something I'm kind of like being semi aware of, but without really applying it to my own situation.

Brandee   7:34  

How much control do you have like because pensions are like a big thing in Britain so how much control do you have about like where that money? Yeah, I don't I mean, I

Hannah  7:45  

think you can Yeah, I don't really know. Honestly, because it's because I haven't worked I mean I think I'm have some very minimal pensions contributions from summer work that I've done, but because I moved to Spain. I moved I moved to Spain before I'd ever worked full time in in the UK and then that's again that was one area that just for personal investment. I've been like, putting off sorting out but now I'm nearing 30 I'm like I should probably work out pensions. So yeah, I think you can

Brandee   8:20  

I mean

Hannah  8:23  

yeah, I don't really know I'm sorry, this isn't a very helpful answer.

Brandee   8:26  

No, it's okay. To do like a bit of a disclaimer in the beginning we are not financial experts, excuse me experts speak this morning advisors whatever No part of this episode is intended as financial advice just sponsored what we do know yeah, I've learned have yet to learn how this all relates to climate etc. So Aaron, it's so it's such a personal thing.

Hannah  8:51  

Where have you when you've done your research what what kind of places have you looked brandy?

Brandee   8:56  

So I've looked at Sorry, I'm just gonna tweak my volume a little bit because I think I'm a bit too

Hannah  9:05  

is mine Okay, should I move my microphone?

Brandee   9:07  

I think yours is okay. I'm just saying like okay, my I'm like kind of going off the off the charts. Anyway. I don't remember why I've looked in the past I know what I was reading from Triodos Bank earlier that was from their website. And I've know I've heard they had heard various like news you know, news outlets and articles and stuff about like, like this one I just recently just pulled up again. This one is from Rainforest Action Network just for example, overall fossil fuel financing remains dominated by four US banks, JP Morgan Chase city, Wells Fargo and Bank of America. So depending on where you're located, may or may not have heard of those some of these it I think are kind of all over. I have credit cards with two of these banks. So a little T but the Wells Fargo one is like my oldest credit card. And I know there's like a whole community that is like against having credit score. worse, I feel more comfortable having a good credit score, I'm not prepared to like, get rid of all credit. So having that old, my oldest card remain like stay open, I had like one recurring charge. And then I have the city car, which is through American Airlines, which is how I get miles to like help cover some of my like flights to go, excuse me to go visit, you know, when people back in the US. So yeah, I have to two of those four.

Hannah  10:28  

And I guess that is potentially one of those things, isn't it? The some of the more Presumably, the more sustainable banks, or the banks that have been set up specifically in that way, are smaller and newer. And so maybe don't offer the same kind of benefits or products? Some of the larger banks.

Brandee   10:53  

Yeah, the things larger banks, you have, they have more of a presence, there's more branches. And I don't know, just easier, right? And you're I know a lot of people are likely already with these banks. And switching banks is a pain because you have to, you know, you have to do things you have to sit down and either research or fill out stuff online or branch. So I get that. Yeah, definitely. It's

Hannah  11:16  

been interesting having this conversation, because I just don't think it's anything that I've really thought about, I think, you know, I've got two bank accounts in the UK one, which was like the one set up for me as a child, which is just where my parents banked. And then one before I went to uni, which I just chose because it gave like a you know, it was like the classic like, sign up as a uni student and you get like a four year rail card or you know, whatever it was. And then in Spain, I just by Spain, I also have to all these bank accounts, but no money. No, but I add, I just kind of chose the one that was like easy for foreigners and was kind of advertised to foreigners. And then they had like English speaking. Yeah, same people. And they obviously did a good campaign because I feel like pretty much everyone I know who came to Madrid around a similar time to me has that same bank,

Brandee   12:20  

we everyone had the same program that brought me here, like, Is that the same thing? Because they said they made it easy for us. So you're in a foreign country, you're gonna go with easy options.

Hannah  12:28  

And then another one I did open fairly recently, but I also didn't really think about more deeply. It's just like, what, yeah, what benefits they had for me. But it's true, of course. So I guess particularly when it comes to investments, or pensions or things where you've got bigger chunks of money saved. That's money that banks play around with more, right?

Brandee   12:52  

Yeah, so going into this episode, it was I wanted to talk about you know, keeping your you know, like your checking account, our current account, credit card accounts, like I I was bringing in this like kind of go to like not maybe not trying hard enough to switch to like the more kind of ethical or socially responsible banks. But then when I was doing research, which article was an of course, it'll be linked in the show notes. I think it was this one BBC, while your banking habits matter for the climate was it many of these banks also offer current or checking and savings accounts to ordinary customers, although this does not typically mean your money is being used for fossil fuel investments. This is because in most countries, consumer banking arms of banks are separated from their investment arms. The money sitting in your bank account is instead normally used for loans to other customers, such as mortgages, rather than investments. So it's worth looking into your bank, your country, your situation. But as a general statement, like I didn't realize this, I thought, like, the money that's in my accounts are being used by the banks to do whatever they want, you know, yeah, more Gods more fossil fuels, like just, you know, investing or financing whatever they want. But, so I'm gonna, I'm gonna take a deeper dive and see, like, my, if this is true for, for me, but as a general, like a general statement, that seems like investments, like individual investments could be the, I don't know the like, more impactful thing you can do. Because yeah, I tend I don't keep balances on my credit cards, actually them like debit cards. So I, you know, I had in my head okay, all my banks aren't like making fees for me, or getting fees for me, and I'm using that for whatever they want. But yeah, my investments I have switched to something called Wealthfront, which I think you can there's like it's just a general investing platform, like a robo type of investor. You just choose like, I don't know, an index font or whatever. And if you don't know where to index one is, just Google it. It's just a way of investing in like multiple things. But you only have to Like choose one thing, that's the most important, like, and so they have an option to do like ESG funds, which is environmental, social governance. And I forget what exactly they like screen for. But I think it's the typical day like it doesn't support like fossil fuels and arms, etc, tobacco, those sorts of things. So I have have that there. And that is obviously money that sits there. So after, like a bit of this, like light research, I feel better that like, I've at least, like made that switch. And I pulled over like, whenever I worked in like a regular job. In the US, I like switch all of that over. Like I wrote all of that over to, to this account and chose the like ESG option, which I think when they first came out, they like maybe weren't performing as well, and I think even spoke to an advisor, financial advisor once and she's like, if you're willing to like not see quite the same returns as regular, like index funds or whatever, that this is, you know, ESG options, like are still a decent, decent option. But I think now they're performing just as well as if not slightly better than kind of the General. General stuff. I don't know if I'm getting any of this wrong, if any of you listening our financial experts, let us know. But they seem it's just, instead of picking the regular option, you can choose like, at least find that Yes. ESG option. And from what I understand there, it's just as good. So So yeah, I don't know if this is kind of like ease some of the guilt of not being able to switch to the bank. So want, because then it kind of turned into a question for me of like, okay, even though this money might not be at, like, you know, directly financing fossil fuel industry and as well as others. Because apparently, banks also like, well, finance, other high, high emitting business sectors like steel, cement, petrochemicals, manufacturing, transport, real estate, etc. That's something track.org. But is it still a matter of like, kind of putting my money where my mouth is like?

Hannah  17:03  

Yeah, I guess, even if deal money isn't being used, I guess by being a member of that bank, in some way. Is some is somewhat supporting what they're doing.

Brandee   17:15  

Yeah. Because it's like, you know, every time I pull out this card, it's like an advertisement for that company. So I don't know, I don't know, if it's, you know, it's like walking around wearing a brand, a branded thing, like, you know, whether you walk around with a shirt that says she and or Primark versus like, I don't know,

Hannah  17:32  

right, and I guess as well, if I guess most banks don't have a particular, you know, their objective is to make more money. And so as long as they've still have customers, so as long as they have like, the same amount of customers, like, does it really matter to them? Do they care about what they're doing? I mean, maybe?

Brandee   17:56  

I mean, I think that one of the articles, I think it went on to say, this does not mean you as an individual customer are powerless to influence the investment behavior of your chosen banks. Yeah, it wasn't bank. I think that article that was the BBC One went on to talk about how you can like, you know, let them know. Yeah, it's like any major, major company, whether it's a major, like fast fashion brand, they're in it to make money. So as long as there's a market for what they're selling, they're going to keep doing it. But if the general trends shift to something else, they need to stay profitable. So they're going to shift with that trend. So is me like switching banks and whipping out a different credit or debit card? Gonna have enough of like a ripple effect. Mm hmm. And, like, play a part and like shifting that trend? Yeah, that makes sense.

Hannah  18:48  

I mean, you never know if this is like, off topic, but my card for one of my banks just like translucent, and everyone comments on it. They're like when I go to pay and they're like, oh, like, like, I've had multiple people comment on it. And I would never have thought that anyone would even notice that. I mean, they're not doing I don't think they're really connecting with a bank but it's true. Like maybe subconsciously.

Brandee   19:13  

Yeah, well, that is a thing. You know, I've seen like various credit card companies advertising the like higher end cards is like, you know, metal or just like sleeker looking. And that is supposed to be like an appealing kind of perk to having that account that card. Is that it looks nice.

Hannah  19:33  

Yeah. So yeah. And then

Brandee   19:37  

and then I also go back with like the so that my main credit card is like a travel card and I get miles and then I think is that influencing me like prioritizing flights because I have the miles and I'm probably talking about this and like upcoming like travel episode. Like a recent trip I booked because I had the miles because I use this for everything. So, but I use his cards because that is a perk. And I wonder, which, like, at one point, I think it was before I moved, I have like this whole spreadsheet that I made like various travel cards and I was gonna start with like this one, this card I have now and then have it I think before the feet kicked in and then switched to this next card that had like good rewards. And then there was like one more the like, I think it's a chase card actually the like, they're like higher end travel card. I think it was called sapphire or whatever. And I we're not endorsing like any specific credit card. No, I'm definitely not sponsored by anyone.

Hannah  20:37  

Is that that's not really plainly clear. No, then I ended up you want to sponsor it.

Brandee   20:43  

But I ended up just sticking with this card, because it just works for my situation. And now the airline I typically travel to go back to the States. And because I use the card so much, it doesn't usually end up covering at least one leg of the trip. So yeah. So I don't know. But of course, like if I have it that options there. I'm going to use it. Yeah,

Hannah  21:04  

I mean, I would use it too, though.

Brandee   21:10  

But maybe it's time to switch tricking. Hmm, I don't know. But then they like keep you on because they like, increase your limit so much. And then it is even not using it nice knowing that, like it's there, if you do need it. Which I know there are obviously other ways to like kind of prepare for things like have savings, but just have that extra kind of layer. So I don't know. I don't know if that's like, a high priority thing. Because like is the like, investment side of it enough? Right? Yeah. If people talk about like credit unions, and like that is usually a more like local kind of option. So that's definitely working worth looking into if that's an option for you.

Hannah  21:56  

Yeah, I mean, I guess a lot of this also connects into bigger questions, which we're not informed enough to comment on right now. But like, you know, your position within capitalism, like how you feel about the way International, like financial systems are organized, like, those are those things and also like time to like, buy, you might prefer a cooperative way of like banking. Yeah, but I don't feel qualified to comment on that right now.

Brandee   22:31  

My main takeaway from like, kind of preparing for this episode was that maybe my like, guilt and not being able to switch my bank was not misplaced, but maybe not like, was like small potatoes and like, investing directly investing in funds to support the things that I want them to support and don't support things. I don't want them to support line by now. And I guess maybe that's like a good thing, you know, because this is, at the end of the day, like,

Hannah  22:57  

this is something that we can change. You know, you can change who you bank with most of the time. So I guess it's like, and but it does feel like it always it just feels kind of like a pain in the ass. Like, you don't really want to do it. So like maybe kind of starting from like, the highest impact thing. You know, if you're going to change one thing I read, like maybe that'll be like your pension or your like investments, if you have those things, and then down to like, your current asset, rather than like changing your current account and being like, Oh, I'm done now, because that was so much effort.

Brandee   23:36  

Yeah, like, wherever you currently like have investments, pensions, whatever, like do, does that like company have an option to switch? liquid funds? Right. I think that was kind of all I had to say about this topic. Did Yeah, it was really yeah. Any other thoughts or questions?

Hannah  23:55  

No, I think it's a really interesting, I don't know is that thing I don't know. It's one of those things where I just feel like, it's easy to kind of, it's easier to concentrate on like your smaller individual actions. And obviously, this is an individual action, but it's just like, kind of a system that you bought into and it's really easy to have not, or like, I haven't really thought about it before. Maybe that's me just being a bit oblivious.

Brandee   24:20  

But it's easy to not think about if no one around you is talking about it.

Hannah  24:24  

Right? Exactly. It's just like, Oh, you have your bank and you just you know, that's where your money is. And that's just kind of how things work.

Brandee   24:31  

Yeah, I think bottom line, there are other options. It's just worth looking into what those options are for you. Yeah, so I'm gonna, I'm gonna look into my, my investment funds again. Just see where exactly I can't remember if I I'm not good at like retaining information beyond like, like a checkmark or an X. Yeah, so I've switched to this account. So I think I did the research before but just can't remember but I'm gonna look into that again. And then I don't know and then either feel like that. That's enough or see if there's another option. Yeah. Banking wise, because I think that's if it doesn't, even though it's not like the highest impact thing, if it's, I noted it this in the in the outline like, but aren't we still supporting them by continuing to bank with them? Right, despite, despite the likelihood that our money is not being separate from like their investment? Yeah.

Hannah  25:24  

I know, like an individual level, I think, you know, obviously any action that we do to meet, like, the various parts of our lives more in line with our our values is like a good thing.

Brandee   25:37  

You Yeah, while still maintaining the like, perspective that like, right, individual action isn't, isn't the biggest issue here. And has been made to be the issue by the people at play, who don't want us to, like focus on them. The real issue, which I think we talked about in a recent episode, that was not very coherent way to say it, but yeah, yeah. It's just like constant I thought is like the constant gray area, isn't it of like, yeah, wanting to make changes. But the quicker when is in your own lives, even though it's like, yeah, those few, that small number of companies that are distracting us from like, their impact, by making us think that it's on us to change things? Not that isn't that we can't. So yeah, it's like maintaining that, like, it's like a tightrope walk the balance of like, yeah, I can make these changes, but also make you make changes to big companies. Right. I don't know. I don't know, I have the best balance. So the best of walking the tightrope, because I can really go down rabbit holes of like, yeah, the individual side of things.

Hannah  26:51  

Yeah, I mean, but also, if this is like a straightforward change for you, it's just like something that requires like, time and effort, then why not? Change it? You know, but then, you know, there's other circumstances where it's difficult to change, but yeah, yeah. No, no, no, it's fine. We're good.

Brandee   27:16  

Change your banks and route. Note, we'll leave all links and resources mentioned but also others that are found in the shownotes at the T on sustainable living.com/episode 27. And I had an idea to start leaving like the the optional leave like a voice recording. It's through SpeakPipe like in each show notes like pay minimum. That's awesome. Because directing everyone Yeah, just to one point instead of going here you go here but then also go to the contact page to leave us a voicemail so yeah, when you check out the show notes, hopefully there will be that embedded just click Record and leave us a voicemail and let us know what you thought about the episode. Where do you bank? Have you switched banks to use credit union not? Have you switched your investments? Tomorrow? ESG funds? Or are you like What the I don't know what that you're talking about? Let us know. And yeah, to the next one. I

Hannah  28:16  

Thank you so much for listening to this episode of The Tea on Sustainable Living podcast. Now go share it with a friend, a co-worker, a partner, a family member, or whoever. A pet, your cat, someone on the street.

Brandee   28:28  

Whoever you think could use a little more support on their sustainability journey, share it.

Hannah  28:33  

You can send them over to our website, theteaonsustainableliving.com. And while you're there, check out the show notes for more info on today's topic. 

Brandee   28:43  

All right, Give-a-Shitter, tea you later. Get it? Tea you later? As in, see you later? So punny…

Hannah 28:52 

Brandee!

Transcribed by https://otter.ai