The Royal Commission has exposed the flaws of a financial system that is driven by profit above all else.
People are losing their trust with the banks and the financial system as a whole. Consequently, there’s been a growing interest in cryptocurrencies like Bitcoin around the world. However, this seems to be perpetuating the same old paradigm around self-interest and greed. I believe, regardless of what currency or economy we find ourselves in, we need to change the way we use and relate to money.
Fundamentally, money is really just a medium through which we exchange value.
By changing the way we use, share and relate to money has the potential to change every fundamental system of life on this planet.
The good news is with every disruption opportunity is born. And a disruption like this could actually be a blessing
Moving forward, we need to become more mindful of how we spend our money and where we place our value. Here are 3 ways we can transform money into a force for good:
There is a growing global movement of people who are seeking out ways to make positive decisions about what to buy and look for a solution to the negative impact consumerism is having on our world. This movement is known as conscious consumption or ‘conscious consumers’ and their impact is growing.
In a report from Nielsen, a global performance management company, it showed that In the year 2014-2015, sales of consumer goods from brands which demonstrated a commitment to sustainability and social responsibility grew more than 4% globally, while those without grew less than 1%.
How do I buy Ethically?
The retail manufacturing industry is the second most polluting industry on earth, second only to oil. According to Annie Leonard, an expert in overconsumption, only 1% of the materials used to produce our consumer goods are still in use six months after sale. Somewhere, the value of craftsmanship and of provenance has been lost. So here are some tips on how to be a conscious consumer:
Look for businesses that support ‘sustainability’ or the triple bottom line by measuring and demonstrating their social and environmental impact. (see your local ethical business directory)
In August 2016, an alarming new story surfaced where members of Kiwisaver (NZ Super) discovered their retirement savings was, in fact, funding weapons of war.
The investor backlash from this led to over $109m being divested. Considering the population of New Zealand, this was a great David vs Goliath story.
Unfortunately, this is just one example of how retirement savings are being invested. The financial risks involved with climate change and Stranded Assets also poses a massive threat. Entire industries are being affected which will negatively impact the performance of your retirement savings.
So, the second step in transforming money into a force for good is to get educated. Find out what your retirement savings is invested in. What are the macro-trends affecting markets? Is it aligned with your values? What other options are available?
As a conscious consumer, your daily actions can help make a difference to your family and community. As an investor, however, you can make a greater impact by pooling your resources together with other conscious investors to invest in companies which show proactive leadership in sustainability. Ultimately, it’s the actions of corporations which have the biggest impact on the environment and communities.
This is what it means to be socially responsible. As more investors practice this, businesses will be more encouraged to engage in sustainable practices. In fact, due to growing demand, there are a wide array of ethical or ESG funds becoming available. Do your research and find one that suits you.
Awareness and Involvement are the keys to achieving change. Start with yourself to take the first step. Remember the butterfly effect? Small changes made now can lead to enormous changes in the future.
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