Looking for a safe and ethical place to stash your cash? Strict about veganism? Try vegan investment funds!
By Chere Di Boscio
It’s a sad fact that what’s commonly known as ‘sin stocks’ actually pay well. That’s to say that if you invest your cash into arms and weapons, oil, coal, gambling or alcohol, you’re not likely to lose money. Mainly because war, crime, energy needs and vice seem to be globally prevalent. The worst part is – you may not even be deliberately investing in such immoral firms. The bank that holds your savings is very likely to be doing it for you.
But…what if we all stopped supporting those banks and companies? What if we pulled out our money and put it somewhere that truly reflects our values?
I’ve discovered vegan investment firms can do just that. They believe in doing good – and getting rich whilst doing it.
What are vegan investment funds?
For example, VeganLaunch focuses on matching vegan venture capital firms, vegan angel investors and newbie investors with vegan companies that have gone through a vigorous analysis process.
It sets strict standards for food companies that are open to investment – they must, of course, be plant-based, and non-GMO (genetically modified). The same goes for fashion companies – they must use ethically sourced labour, and non-toxic, vegan fabrics to qualify for investment.
After meeting ethical standards, vegan companies then go through a thorough analysis of their financial health, business models, growth projections and other specific methods of evaluating the overall projected profitability of the company – after all, it’s as important for vegan investors as it is for anyone else to get the highest return on their investment. But VeganLaunch is on a mission, too: it wants to prove that the most ethical companies can, in fact, also be the most profitable ones in the long run.
Vegan investments, better returns
The consumer and business focus on ethics and quality today has increased exponentially. As we are seeing a rise in veganism, we are also seeing a market demand for products with higher ethics. This could be more dedication to fair trade, better environmental standards, labour practices or a combination of these and more. Companies that want to succeed in coming years will have to comply with higher ethics in order to thrive.
- This is something that the fashion group Kering (formerly the Gucci Group) sniffed out over half a decade ago. They’ve since: dropped fur from most of their brands
- purchased tracts of the Amazon to offset their carbon emissions
- created new brands, such as Sakina M’Sa, which incorporates waste fabrics of some of their core brands, like Saint Laurent and Stella McCartney, into their designs.
Consequently, investors in a more ethical Kering have been greatly rewarded. Stock prices have gone from around 137 in 2014 to around 440 today!
Sure, Kering may be a great example of an ethical luxury fashion company. But what about vegan companies in particular? After all, there are many that are up and coming in all areas, from all-vegan beauty brands, to vegan leather fabric manufacturers like Pinatex, to vegan fashion labels. There are even vegan ‘meat’ companies coming up – Impossible Burger, anyone? And vegan investment funds are also growing as a result of growth in vegan companies.
According to Claire Smith of Beyond Advisors, most ethical companies are, on aggregate, performing better than their unethical competitors. For example, they show a total improved performance of just under 30% over five years. And vegan vegan investment funds are at the top of the class. “This is due to the broken business models of companies that exploit animals and damage the environment,” she says. “There’s no future in these industries if they carry on doing what they’re doing.”
Beware the vegan greenwash
But even within vegan brands, there are various ethical standards to be aware of. Impossible Burgers, for example, may taste remarkably meaty. But they use genetically modified organisms (GMOs), which for me is vile. It would stop me from investing in them (or even eating them, for that matter).
Moreover, some vegan fashion brands are simply substituting leather for plasticky fabrics. Or worse, PVC – a definite no-no in my book. Indeed, as consumers get ever more savvy, “vegan companies will need to focus on constant improvement and excellence in order to have a place in the market,” says Simen Lie of VeganLaunch. “The rate of progress goes up every year, and if a company focuses a high percentage of their efforts on continuous improvement and increasing the quality of their product or service for the customers, the company has a chance to thrive in the next years. Being an all vegan company is not enough to ensure longevity – there must be high focus on excellence, too.”
Making a difference
If you really want to make a difference in the world – and get richer doing it – look for the most ethical vegan company you can invest in. Yep, forget signing petitions or circulating posts on Facebook. The best thing you can do is put your money where your mouth is.
As mentioned above, if you’re using a typical high street or international bank, it’s pretty much guaranteed that all your savings are being invested by that institution into ‘sin stocks’. Oh, and they’re only giving you around 2% interest for the favour.
Why are you literally giving money to companies you probably hate?
- Remove every penny from the banks mentioned above and instead, put your savings into an ethical bank like one of these.
- If you have some liquid capital you’d like to invest, research ethical investment funds. There are plenty of these, such as Hargreaves Lansdown or Investing Ethically for example.
- Learn about the US Vegan Climate Index. This outlines companies’ metrics on carbon emissions, water use, waste products, etc. A larger proportion of the index is devoted to companies that adopt environmentally positive solutions. That way, you know which companies deserve your investment.
- If veganism is important to you, consider putting your money in VeganLaunch or a similar fund. It’s a great way to contribute to growing the vegan economy.
You should know that this article about vegan investment funds was not sponsored in any way. I just strongly believe that if we all withdraw our cash from institutions that use it to destroy the planet and instead pour it into funds that reflect our values, the world truly will become a better place.
Don’t you agree?