Being an activist shareholder can be a powerful way to influence the impact companies have on our planet. Juliet Oxborrow outlines five ways to get involved.

1. Join the Make My Money Matter Campaign
What’s the most effective way to reduce your impact on climate change? Stop flying? Stop eating meat? Well according to a new campaign, ensuring that your pension is held in sustainable investments can have 27 times more impact on your carbon footprint than giving up flying and going vegan combined.

Around £3 trillion is held in pensions in UK, a lot of it funding things like fossil fuels, fast fashion and deforestation. Make My Money Matter argues that if all us made sure that £3 trillion was invested in companies that benefit rather than harm the planet and people, we could all do a lot of good.

This isn’t a new idea but this movement is spearheaded by Richard Curtis (yes – that Richard Curtis). And if someone’s going to get real traction on this – it could well be the guy who gave us Comic Relief.

2. Support ShareAction

Since 2006, not-for-profit, ShareAction (previously called FairPensions) has been the impressive thorn in the side of companies (and big investors) with poor and dangerous practices.

Alongside its overarching goal of responsible investment reform, it uses its funds to buy shares in large public companies (including every FTSE 100 company), giving it the right as a shareholder to demand change, which it’s done very effectively.

On its website, you can view the shareholder resolutions it has proposed, or is supporting, for companies across a range of industries. You can also get involved by becoming an AGM Activist – attending annual general meetings (currently mostly held virtually) to ask the questions to which ShareAction is demanding answers.

3. Get involved in the Divestment movement

If you’re particularly concerned about fossil fuel investment, there’s a whole movement devoted to urging large investors such as employer pension funds, charities and university endowments to sell out of their holdings in oil, gas and coal companies.

Divest East Sussex, for example, has been fighting to get East Sussex Pension Fund (the pension fund of the County Council) to divest £150 million of its portfolio out of fossil fuels. Divest Parliament  has got 360 current and former MPs across all parties to demand that the Parliamentary Pension Fund goes fossil-fuel free – including Lewes’ own Maria Caulfield MP.

4. Seek out companies doing good
As Julia Waterlow explains in her article: Using my money for good, there are a number of investment platforms that specialise in connecting investors of all sizes to companies and ventures involved in positive social and environmental activities. Investor protection for these direct investments isn’t the same as for investing in a regulated investment fund (see Point 5 below) and investing in a single ‘stock’ always carries a lot of risk.

But if you are interested in choosing stocks yourself, you may be particularly interested in the emergence of “B Corps”. This is a new type of classification for companies committed to balancing purpose and profit. Find out more and check out UK companies that have achieved B Corp status

5. Choose sustainable investment funds (but tread carefully!)

Collective investment funds that pooled investors’ money then invest it are considered one of the easiest and most risk-diversified ways for ordinary people to invest.

Unsurprisingly in recent years, lots of asset managers have been launching variously named ‘sustainable’, ‘responsible’, ‘impact’ or ‘ESG’ funds (ESG stands for Environmental, Social and Governance) to attract concerned savers. But working out what’s green wash and what isn’t is still hard – investment funds are still only really ranked on their past financial performance.

One robust tool for asset manager selection comes from ShareAction. It gives major asset managers a rating of ‘A’ to ‘E’ based on the rigour of their approach to a particular area of responsible investment. For example, check out how it ranks asset managers on their action on climate change here…