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Editorialethicalconsumer.org JULY/AUGUST 2016

Growing renewablesWe’re seeing a shift, it isn’t yet seismic, but there is movement. A movement and it’s quickly gathering momentum. That is to say that the carbon divestment movement, while still in its infancy, is having an impact in the UK and across the world.

Billions of pounds worth of shares in carbon intensive industries have been unceremoniously dumped by a raft of institutions from pension funds to universities, largely thanks to the work of campaign group 350.org (see page 12 for more)

To date the focus of campaigners has been on lobbying large institutions to divest from fossil fuels. Some of those institutions that have already taken their money out of the dying coal industry are listed on page 12.

We hope to add to this wider divestment campaign by bringing you a Guide to Personal Carbon Divestment. In the pages that follow we look at the best options for leaving behind the carbon age and becoming pioneers in the fast developing post carbon economy.

There are many ways for individuals to make an immediate impact. In this magazine we focus on switching your current accounts, savings accounts, cash ISAs and investment funds away from companies still funding fossil fuel projects. We also have information on projects addressing carbon and divestment in the new world of auto enrolment pensions.

The good news is that ditching the banks who plough the most capital into the fossil fuel industry has never been easier (see page 13 for more). For those looking to switch a savings account there are also a number of new banks that actively invest in renewables, making the impact of switching particularly effective.

Retiring nuclear powerThe explosive growth in renewables over the last few years has also sounded the death knell for nuclear power. As green alternatives become much cheaper to produce, nuclear power has become increasingly uncompetitive – even with huge subsidies for end-of-life ‘waste

management’. In Europe almost no one is looking to build new nuclear capacity, with the UK’s strange, but surely impractical, obsession over Hinkley C the exception.

With this in mind we plan to retire Nuclear Power as a stand-alone column on our ratings tables later this year. Very few companies are receiving marks in this column now, and we still plan to track nuclear power investments in a new ‘Controversial Technologies’ column which will include nanotechnology and GM. Do let us know what you think of these changes.

This reduction in the exposure we’ll be giving nuclear power reflects the success campaigners – and common sense – have had in defeating this dangerous, environmentally damaging and costly fuel source. The last time Ethical Consumer retired a category in this way – as societies moved on – was in 1993 when the South Africa boycott over apartheid was ended.

Replacing the Nuclear Power column in the Environment section of our tables will be a new Palm Oil column. At the moment companies pick up marks in three categories for this issue and we feel that this is a clumsy way of representing what is now a burning issue for ethical consumers. We know from our own website that there is real demand for clear and concise rankings on palm oil, and we hope that by creating a stand-alone column for this issue – in line with the rankings we have done with the Rainforest Foundation – we’ll be able to better offer this. We also hope that, in a few years time, we’ll be able to retire this new category like the apartheid and nuclear power categories before it.

Our AGMThis year we will be experimenting with separating out our annual London conference and the Annual General Meeting for our multi-stakeholder co-operative.

The Ethical Consumer Research Association AGM will be held on Saturday September 24th starting at 12 midday in the Friends Meeting House in Manchester.

You can find more details about the event, our co-operative, and on how to become an investor member on our website – http://bit.ly/ecagm16

Tim Hunt Editor

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who’s who this Issue’s editor Tim Huntproofing Ciara Maginness (littlebluepencil.co.uk)writers/researchers Jane Turner, Tim Hunt, Leonie Nimmo, Rob Harrison, Heather Webb, Anna Clayton, Joanna Long, Josie Wexler, Ruth Strangeregular contributors Simon Birch, Bryony Moore, Shaun Fensom design and layout Adele Armistead (moonloft.com), Jane Turnercover Adele Armistead (moonloft.com)cartoons Marc Roberts, Sarah Guthrie, Andy Vinead sales Simon Birchsubscriptions Elizabeth Chater, Heather Webb, Simon Robinsonenquiries Tim Huntpress enquiries Simon Birchresearch, screening & consultancy Rob Harrison internet/web Michael Wignall, Georgina Rawesmarketing Tim Hunt, Jane Turnerthanks also to Julia Obinger, Eleanor Boyce

All material correct one month before cover date and © Ethical Consumer Research Association Ltd. ISSN 09�� 8608.

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Contentsethicalconsumer.org JULY/AUGUST 2016

06 food JohnWesttuna,meat-free sandwiches,freerangemilk,pig factories,Arcticfishingdeal

09 home microbeadsban,bee-killing pesticideslatest

38 climate of change breakfreefromfossilfuels

41 tax justice anti-corruptionsummit,citigroup

42 clothes fashionrevolution,ranaplaza threeyearson,live-pluckeddown

44 Amazon boycott TrumpboycottsAmazon!

45 boycotts latestIsraelboycottnews

46 ttip goodbyettip,helloceta?

Follow us: @EC_magazine

Ethical Consumer Magazine

product guides

news

regulars

10-37 fossil-free finance:13 current accounts guide 31banks&buildingsocieties rankedwithBestBuys

17 whoarethefrackingbankers?

18 MoveYourMoney’sDivest campaign

20 carbonrankingofthetop25 banks

21 savings accounts guide 48banks&buildingsocieties rankedwithBestBuys

24 savingwithcreditunions

25 mortgages & cash ISAs guide simplescorecardsandBestBuys

28 small business accounts guide 24currentaccountsforsmall businesses,charitiesandsocial enterprises

30 fossil-free funds guide 13ofthemostdivestedethical funds,directinvestmentsin renewables

34 campaigntosaveTheCo-opBank

36 autoenrolmentpensions

47 subscriptions takeoutasubscriptionorgivea giftthatlastsayear

48 letters aregularforumforreaders’views

50 inside view thefutureofdomesticsolar power

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Keep cows in fields with a free-range milk labelA report released at the end of May by World Animal Protection reveals that consumers may be unaware how much of the milk, cream and cheese they eat is produced in the UK by cows that are permanently reared intensively indoors and never graze on pasture.

Although no official figures exist, the research has found nearly 100 confirmed intensive indoor dairy farms with a further 43 suspected. These systems can hold over 2,000 cows and now account for up to a fifth of the milk produced in the UK. Cows in these systems never go outside, are pushed to their limits to produce more milk, and are at a higher risk of suffering from lameness and udder infections.

The report exposes the expansion by stealth of these intensive indoor dairy farms in the UK. Developers use tactics such as increasing farm sizes gradually and ‘retrospectively’ applying for planning permission.

FoodJULY/AUGUST 2016 ethicalconsumer.org

How it should be – free range cows.

How it can be – intensive dairy farms.

The iconic image of cows grazing in lush field is under threat, claims World Animal Protection. A recent YouGov poll showed that 87% of respondents would want to buy ‘free-range’ milk from cows that grazed on pasture, but that would require more transparency about where British milk comes from. Clearer labelling is required.

Campaign group World Animal Protection UK would like to see free-range milk labelling that provides consumers with an assurance that the milk has come from cows that have grazed outside for the majority of the year, whether the milk is produced to organic or conventional standards.

They are now in discussions with nine supermarkets about providing free-range milk labelling to show which milk is from cows grazed on pasture. Milk not labelled in this way might come from intensive indoor farms.

Of the supermarkets, Waitrose and M&S lead the way with all of their cows grazing for at least 100 days per year although World Animal Protection believe that they should have access to pasture for at least 6 months of the year. Most of the supermarkets sell Red Tractor labelled milk which does not mean cows have access to pasture.

You can pledge to buy free-range labelled milk when it is available at www.worldanimalprotection.org.uk/campaigns/factory-farming/take-action-dairy-cows

Read the full report at www.worldanimalprotection.org.uk/campaigns/factory-farming/take-action-dairy-cows

Of course, a better option for guaranteeing the welfare of cows is to ditch dairy and buy non-dairy milk such as soya.

Victory in the fight against deforestationThe landmark Soy Moratorium, an agreement between civil society, industry and government which prevents major traders from selling soy linked to deforestation, slave labour or threats to indigenous lands in the Brazilian Amazon, was renewed indefinitely in May.

Originally established in July 2006, the Soy Moratorium has been renewed annually but was not, as we stated in our guide to meat-free burgers and sausages in EC160, expected to be renewed this year

“The renewal of the moratorium indefinitely ensures producers and trading companies can continue to rely on forest-friendly Amazon soy to keep the doors to the global market open, even in times of environmental and political economic crisis”, said Paulo Adario, Senior Forest Strategist for Greenpeace International and signatory of the agreement.

Since the initial signing of the Moratorium, the area occupied by soy in the Brazilian Amazon grew from just over 1 million to 3.6 million hectares, with only 0.8 percent in newly deforested areas. “This large increase in soy production, while respecting the moratorium, is proof to the market: producing without destroying the forest is good business”, said Adario.

However, other things in Brazil’s Amazon look less rosy – the presidential impeachment or right-wing coup (depending on your viewpoint) currently happening there is likely to have serious effects for the Amazon and the Moratorium. The new acting Brazilian president has chosen for his agriculture minister a billionaire soya tycoon who has been responsible for deforesting huge stretches of the rainforest. The Moratorium is an industry initiative, but many people put its success partly down to the generally supportive political environment it has been operating in.

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Sainsbury’s: drop John WestPressure is mounting on Sainsbury’s to take action and remove John West tuna from its shelves to ensure all the tuna it sells is 100 % sustainable, not just its own brand.

The UK’s biggest tuna brand, John West, made a commitment way back in 2011 to phase out unsustainable and destructive fishing methods by the end of 2016. But by October 2015, only 2% of their tuna met this criterion so it is very unlikely that it will meet its target.

98% of John West tuna is caught using Fish Aggregating Devices (FADs) which accidentally ensnare a huge variety of wildlife such as sharks and endangered turtles.

Greenpeace’s 2015 tinned tuna league table exposed John West as the least sustainable brand on the supermarket shelf. Additionally, a New York Times investigation uncovered widespread human rights violations in John West’s seafood supply chains.

John West has refused to respond or make any substantial progress. However, in May, after a Greenpeace-orchestrated email campaign, Tesco and Waitrose announced that they would stop stocking the tuna brand if John West failed to improve.

Greenpeace has now turned its attention to Sainsbury’s, pushing them to remove John West. They claim that:

“Sainsbury’s is the second biggest supermarket in the UK after Tesco – and last year they were in the top three in our Tuna League table. Unless they want to be left lagging behind in sustainability standards, they need to follow the lead of these other major UK supermarkets and clean up their shelves.”

What tuna brands to buy

Most own-brand supermarket tuna, apart from Lidl’s, is now sustainable due to consumer pressure off the back of Greenpeace campaigns and the Fish Fight programmes led by Hugh Fearnley-Whittingstall.

Waitrose, Sainsbury’s and Marks & Spencer have consistently topped Greenpeace’s tinned tuna rankings over the years and continue to find ways to improve. Fish4Ever is an independent

brand which is also 100% sustainable. All of these brands were also Best Buys in our Tinned Tuna guide – see our website.

However, as above, Sainsbury’s is still stocking John West but you can email the supermarket via the Greenpeace site telling it to drop the brand – http://bit.ly/1TQB35p

Princes, the second biggest brand (after John West), is another brand to avoid. It promised 100% sustainable tuna by the end of 2014. But by October 2015 it had managed a measly 25%.

Foodethicalconsumer.org JULY/AUGUST 2016

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On May 23rd, 25 activists locked themselves to large tuna cans at a major processing facility in Brittany, France belonging to Thai Union, the owner of John West. On 21st May teams of volunteers cleared the shelves of tinned John West tuna in more than 50 Sainsbury’s stores throughout the UK.

Fishing industry deal for Arctic protectionLeading seafood brands, major UK’s supermarkets and some of the world’s largest fishing companies, have struck a groundbreaking deal to protect a key Arctic region from industrial fishing for cod.

Companies including McDonald’s, Tesco, Birds Eye and Young’s Seafood have said their suppliers will refrain from expanding their cod fisheries further into pristine Arctic waters whilst scientific research into this largely unexplored marine environment takes place.

The agreement covers an area twice the size of France and was brokered by Greenpeace following a campaign launched in February. It marks the first time the seafood sector has voluntarily imposed limitations to industrial fishing in the Arctic. This means that any fishing companies operating in these pristine Arctic waters will not be able to sell their cod to the brands supporting this agreement.

This summer, the Greenpeace ship Arctic Sunrise will go to the Arctic to ensure that the entire fishing industry meets these commitments and that cod ending up on UK dinner plates does not come from Arctic destruction.

Signatories: Tesco, Morrisons, Asda, M&S, Sainsbury’s and McDonald’s, The Saucy Fish Co, Young’s Seafood, Nomad Foods (Birds Eye, Iglo and Findus).

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FoodJULY/AUGUST 2016 ethicalconsumer.org

40% of UK pigs are born outdoors.

54% of UK pork is imported from EU pig factories like this.

Slim pickings for a meat-free sandwich A survey commissioned by the Better Eating campaign has found that just 19 out of 535 (4%) pre packed sandwiches sold on the high street did not contain meat, fish, cheese or eggs as main ingredients.

The vast majority (77%) were meat or fish based, the rest being vegetarian.

Campaigners looked at 535 sandwiches and wraps from eight supermarkets (Asda, Boots, Co-op, Marks & Spencer, Morrisons, Sainsbury’s, Tesco, Waitrose) and four high street sandwich chains (EAT, Greggs, Pret a Manger and Subway) and found that consumers trying to eat healthily and reduce their impact on the environment will struggle to find a vegan sandwich.

Only two stores (Pret and M&S) offer a different vegan option for every weekday. Greggs and ASDA had no vegan options at all. Most of the companies only had one or two vegan options.

There are over half a million vegans in Britain, according to research released in May by The Vegan Society. This is an increase of over 350% since the last estimate of 150,000 ten years ago.

Pret vegan sandwich. With 3.25% of the population, around 1.68 million people, either vegetarian or vegan, what are the options for a meat-free sandwich?

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Turn your nose up to pig factoriesLaunched in May, Turn Your Nose Up to pig factories is a campaign exposing the poor animal welfare suffered by pigs on most pig farms and encourages consumers to only buy high-welfare pork.

Tracy Worcester, founder of Farms Not Factories, who is running the campaign, says:

“Our message is simple, we want to help bring an end to this inhumane system and encourage the public to only buy pork from high-welfare farms. Vote for real farming over factory farming by buying pork with the labels RSPCA Assured (previously Freedom Food), Outdoor Bred, Outdoor Reared, Free Range or best of all, Organic.”

That means, don’t buy Red Tractor labelled pork or pork with no welfare labels.

Approximately 10 million pigs are slaughtered in the UK every year, 70% of which are reared intensively and may be labelled Red Tractor or have no welfare label. This means they are housed permanently indoors on bare concrete slats.

Although sow stalls – metal cages so narrow that the sow cannot turn around – have been banned in the UK, in the rest of the EU they can be used for 5 weeks. Farrowing crates are slightly bigger than sow stalls and are where a sow and her piglets can be confined for 5 weeks. These are legal in the EU.

Where to buy high welfare pork

Waitrose stands out because the majority of the fresh pork they sell is Outdoor Bred. The majority of M&S’s fresh pork is either Outdoor Bred or RSPCA Assured. The only supermarkets selling any organic pork are Waitrose, M&S, Sainsbury’s and Tesco.

See also http://farmsnotfactories.org/directory for a directory of farms, shops & restaurants that sell higher welfare pork.

Many veg box schemes also sell organic meat. One of the biggest national schemes, Riverford, only sells organic pork.

Of course, the other option is don’t buy pork. There are plenty of veggie and vegan alternatives. See our guide to meat-free sausages and burgers.

The #MeatFreeLunch campaign is encouraging people to swap their lunchtime meat, fish, cheese or egg sandwich for a vegetable-based option, or try making their own. Find out more from www.eating-better.org

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Government rejects NFU application to use banned bee-harming pesticidesGood news for bees. In May, the government rejected an emergency application by the National Farmers’ Union (NFU) for farmers to use banned neonicotinoid seed treatments on oilseed rape this autumn. A similar request last year was eventually allowed.

The NFU said that the pesticides were needed to prevent oilseed rape crops being harmed by pests but Friends of the Earth pointed out that government figures showed the average UK oilseed rape yield rose nearly 7% last year, in the first harvest after the ban was introduced.

But the NFU says it will try again. Last year, the NFU’s second application to use the pesticides on a much more limited area of the country was successful.

Three neonicotinoid pesticides were restricted throughout the EU in 2013 after scientists warned they posed a “high acute risk” to honeybees. That ban is currently being reviewed and the results are expected at the end of January 2017.

But campaigners want the ban to be made permanent and extended to all neonicotinoid pesticides. The top manufacturers of neonics, Bayer and Syngenta are working hard to get the ban lifted. They have said that research has exaggerated the risks and understated the benefits of the chemicals.

Opposition to neonics is growing. A Sum of Us campaigner spoke at the AGM to thousands of Bayer shareholders, with an official motion asking Bayer’s shareholders to pay attention to the massive opposition worldwide against bee-harming pesticides. There are moratoriums on neonics in the EU, a ban in the US State of Maryland, and two of Canada’s largest provinces are phasing out neonics – one of which was just upheld in spite of a court appeal. And France’s parliament voted for a biodiversity law that includes a total ban on neonics, starting September 2018. But the ban needs to approved by the Senate which rejected it in a previous reading.

One of the USA’s largest lawn and garden chemical companies, Ortho, will stop using three neonics by 2017. However, Ortho’s parent company, Scotts Miracle Gro, continues to sell neonicotinoid pesticides like Bugclear and Roseclear in the UK.

In the USA, two hardware chains, Home Depot and Lowe’s have committed to taking bee-harming pesticides off their shelves. And Aldi in Germany has banned eight pesticides – including three bee-harming neonicotinoids. Aldi UK is currently reviewing its pesticide policy as a result of this move by its parent company.

Meanwhile, Friends of the Earth’s Great British Bee Count (19 May - 30 June 2016) is currently taking place. It aims to raise awareness about the wide diversity of Britain’s bees, the threats they face and what people can do to help them.

People can register for the free app at: www.greatbritishbeecount.co.uk

Government commits to ban on microbeadsThe UK government has, for the first time, hinted it would be open to banning harmful microbeads – tiny pieces of plastics used unnecessarily in toiletries which end up in the oceans and the animals that live in them.

Defra minister Rory Stewart said: “If we cannot get a common position out of the European Union, we are open to the possibility of the UK acting unilaterally.”

Last year, President Obama signed a bill outlawing microbeads from rinse-off cosmetics like toothpaste, body washes and facial scrubs by mid-2017 but it ignored other products like cosmetics and detergents.

Greenpeace UK, along with Fauna & Flora International, the Marine Conservation Society, the Environmental Investigation Agency and Beat the Microbead launched a petition calling for a complete ban on microbeads. So far it has been signed by nearly 300,000 people.

The microbead campaign has been running since 2012 and has been very successful. Most companies have removed or committed to remove microbeads from their products.

What you can do

Sign the petition to David Cameron to ban microbeads – https://secure.greenpeace.org.uk/page/s/ban-microbeads

Download the Good Scrub Guide pdf which lists facial scrubs free of microbeads, and the guide to microbead-free toothpastes, body scrubs and shaving products – www.fauna-flora.org/initiatives/the-good-scrub-guide

Download the free Beat the Microbead smartphone app which allows shoppers to scan a product’s barcode to check whether it contains plastic microbeads – www.beatthemicrobead.org

Check the ingredients list: Polyethylene is the main type of plastic microbead used in exfoliators, so if your product includes this, it is highly likely that it will contain microbeads. Other plastic types to be aware of include oxidised polyethylene, polyethylene terephthalate (PET), polymethyl methacrylate (PMMA), nylon and polypropylene.

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Fossil-free financeJULY/AUGUST 2016 ethicalconsumer.org

ProductGUIDE

Your guide to personal carbon divestment

The campaign for ‘carbon divestment’ has become the fastest growing divestment movement in history. In this report on Banking, Investments and Pensions, Rob Harrison asks what it means for our own financial choices.

You can find a video of the full address on our website www.ethicalconsumer.org/tutu

In April 2014, Archbishop Desmond Tutu added momentum to a call for people to ‘divest from carbon’ – or

in other words to pull investments out of the oil, coal and gas sector. “It makes no sense” he said “to invest in companies that undermine our future. We need an apartheid-style boycott to save the planet”.1

His intervention was an important moment. It gave clarity, impetus and voice to a fledgling idea, and fresh impetus to a new and vital political movement.

As individuals we still need to burn fossil fuels to stay warm or to travel across the country, but it is not inconsistent to say that we are now at a point where the financing of new oil wells, new coal mines and new fracking sites needs to stop.

“People of conscience need to break their ties with

corporations financing the injustice of climate change.”

Archbishop Desmond Tutu

Shares in oil companies are being likened to those in tobacco in the 1970s and in South Africa in the 1980s. It is dirty money. And to profit from it is to profit from human suffering.

This argument is gaining traction so fast that even the Financial Times admitted that “a global campaign against fossil fuels is entering the financial mainstream”, and Kevin Bourne, FTSE Group managing director, described it as “one of the fastest-moving debates I think I’ve seen in my 30 years in markets.”2 Major financial institutions are now lining up to announce an end to investments in coal, and are beginning to focus on pulling out of other fossil fuels and investing in renewables.

The sun is setting on the carbon economy.

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ProductGUIDE

renewables only accounted for just over 10% of world electricity in 2015.4

However, the proportion is increasing. In May, a new milestone was reached when all of Portugal’s electricity consumption was generated exclusively by solar, wind and hydro for four consecutive days. This was just days after Germany announced that clean energy had powered almost all its electricity needs on Sunday 15 May, with power prices turning negative at several times in the day – effectively paying consumers to use it.5

The power is in our handsMost people in Britain do not directly own shares but almost allof us have bank accounts and around half of us have pension funds investing in shares on our behalf. A significant amount of finance for new fossil fuel extraction comes from our own banking sector, and campaigners around the world are beginning to measure and compare involvement and to name and shame the worst offenders.

In this guideBanking

We look at new international research by the Fair Finance Guide on the carbon ranking of the top 25 banks on page 20.Our own research on bankers for fracking companies appears on page 17.Move Your Money writes about its campaign against HSBC and carbon on page 18.Our product guides to Current Accounts and Savings Accounts update our rankings of banks against our usual range of issues (pp 13 and 21).A new guide to Business Bank Accounts looks at good places to bank for charities, social enterprises and SMEs (page 28).Shaun Fensom charts the rise of the new Customer Union for Ethical Banking on page 34.The credit union option is updated in the light of recent changes on page 24.

Ethical Investments

Despite there being more than 100 ‘ethical funds’ on the UK market, very few of them have yet embraced the idea of carbon divestment. The idea of spreading risk across economic sectors is very entrenched in the minds of investment managers and fossil fuels are a big sector to walk away

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Clean energy investmentThe transition away from a fossil-fuel economy requires not just divestment from carbon but also much investment in new renewables capacity. In a way this makes the new divestment movement a bit more complex than those of tobacco and South Africa in the past.

This theme is reflected in all our product guides this issue and marks the beginning of a shift in thinking in the personal finance sector. The ethically safe havens of a traditional building society are beginning to look less good when faced with the question ‘who will finance new renewable capacity?’ The real innovators like Triodos, the Ecology Building Society and, to some extent, the Co-operative Bank, are looking well placed in this brave new world.

According to United Nations Environment Programme (UNEP), 2015 produced a new record for global investment in renewable energy. The amount of money committed to renewables rose 5% to $285.9 billion, exceeding the previous record of $278.5 billion achieved in 2011. This was more than double the amount invested in new coal and gas generation, which was an estimated $130 billion in 2015.

Overall, renewables made up 53.6% of the gigawatt capacity of all technologies installed in 2015, the first time they have represented a majority.

Less encouragingly, UNEP found that the huge weight of conventional generation capacity already built meant that

from. Campaigners, though, seem pretty clear that the time for ‘engagement with companies’ or ‘responsible shareholder activism’ has now run out.3

We look at 13 of the most divested ethical funds as the new gold standard in the market on page 31.We also look at how people can use direct investments or peer to peer lending to fund the clean energy infrastructure that needs to replace fossil fuels on page 33.

Pensions

In the UK, new government regulations mean that all employers need to make pension arrangements for their staff by 2018. Campaigners have recently realised that none of the state-approved ‘auto enrolment’ options are fossil free and are beginning to work on this issue.

On page 37, ShareAction summarises its recent research on ethical performance at these auto enrolment firms.On page 36, a financial advisor working in this area explains the options.

Mortgages and Cash ISAs

Two mini guides showing just a basic score table and Best Buys for Mortgages and Cash ISAs. The full guides appear on the website.

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Drilling rig at a hydrofracking installation near Westhoff, USA.

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References: 1 www.theguardian.com/environment/2014/apr/10/desmond-tutu-anti-apartheid-style-boycott-fossil-fuel-industry viewed 15/5/16 2 Financial Times 28 Apr 2014 - FTSE joins Blackrock to help investors avoid fossil fuels 3 http://gofossilfree.org/uk/frequently-asked-questions/ viewed 15/5/16 4 UNEP Global trends in renewable energy investment 2016 5 www.theguardian.com/environment/2016/may/18/portugal-runs-for-four-days-straight-on-renewable-energy-alone

Working on the 2016 Banking Special Report for Ethical Consumer were: Anna Clayton, Ruth Strange, Josie Wexler, Joanna Long, Heather Webb, and Rob Harrison.

Some carbon-divested UK institutions

Birmingham City University

British Medical Association

Cambridge City Council

Church of England

Church of England, Diocese of Oxford

City of Bristol

City of Oxford

Environment Agency Pension Fund

Guardian Media Group

Haringey Pension Fund

Heriot-Watt University

Kirklees Council

London School of Economics

Methodist Church of Britain

National Synod of Scotland

Oxford Brookes University

Oxford University

Polden Puckham Charitable Foundation

Quakers in Britain

SOAS, University of London

South Yorkshire Pension Fund

University of Edinburgh

University of Glasgow

University of Portsmouth

University of Sheffield

University of Warwick

University of Westminster

WWF-UK

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Despite our focus on personal finance in this issue, campaigning around collectively-held assets continues to remain at the core of the divestment movement up to this point. 350.org – a US campaign group founded by university students and author Bill McKibben in 2008 – lies at the centre of this movement.

350.org’s name stems from research published in 2007 by James E. Hansen, that proposed 350 parts-per-million (ppm) of carbon dioxide in the atmosphere as the ‘safe’ upper limit to avoid a ‘climate tipping point’ and an unliveable world. Having reached 400ppm CO

2 globally in March 2015, there is a

need for a global movement that reflects

the urgency demanded by climate change and 350.org has been a keen player in helping to drive this.

Its work to date includes campaigning against coal power plants in India, stopping the Keystone XL pipeline in the US, and encouraging public institutions everywhere to divest from fossil fuels. In May 2016, 350.org claimed that over $3.4 trillion has been divested from the fossil fuel industry and listed 518 formally divested institutions around the world on its website (see the box-out right for more details). 350.org also participated in the inspiring ‘Break Free from Fossil Fuel’ fortnight of action detailed on page 38, and it continues to pressure the Obama Administration to release a five-year plan that rejects all new offshore drilling for oil and gas.

Its website, fossilfree.org.uk, also provides a whole range of resources for people looking to begin or join campaigns targeting their own local institutions.

Carbon divestment – the campaign so far

Break Free from Fossil Fuel – On six continents in May, thousands of people took action to keep coal, oil and gas in the ground. The UK’s largest open-cast coal mine in Ffos-y-Fran, Wales was shut down for over 12 hours.

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It is not hard to find something bad to say about banks – from tax avoidance and excessive pay to the bank bailouts that have ushered in the age of austerity. In line with the current rise in carbon divestment campaigning, we also look at where banks stand on fossil fuels and renewables.

The big five and fossil fuelsOver 80% of current accounts in the UK are with the ‘big five’ banks. These are HSBC (including First Direct and M&S bank), Lloyds (including Halifax and Bank of Scotland), RBS (including NatWest and Ulster Bank), Barclays and Santander.

Unfortunately, according to the Move Your Money campaign, these banks are among the biggest investors in climate change.5 They all lost marks on our table for having a boycott call against them, as Move Your Money calls on customers to remove their money from banks who are investing in fossil fuels (see page 18). Barclays Bank is even the majority shareholder of a fracking company, Third

Current accounts

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Bank underground station is next to the Bank of England in the heart of London’s financial district.

Energy. Other links are revealed in the ‘Fracking Bankers’ article on page 17.

To manage the environmental and social risks of the investments they make, all the big banks have adopted the international ‘Equator Principles’. However, the banking watchdog BankTrack is concerned that this contains a “complete lack of any meaningful commitment on combating climate change”.6

And all five of these feature in the 2015 Fair Finance guide which lists the top 25 global banks funding fossil-fuel projects around the world. You can read more about this on page 20.

Who supports renewables?Only The Co-operative Bank states its support for renewable energy organisations alongside a commitment not to provide banking services to the fossil fuel industry. It has, however, recently sold many of its renewable-energy assets to raise cash, and does not control the hedge-fund investments of some of its owners. More information on The Co-operative Bank appears in the profile on page 27 and in the article on the new Customer Union on page 34.

No building societies offering current accounts – nor the Metro Bank, which also came high on the table – are making a point of supporting renewable energy, but neither do they invest in fossil fuels.

Triodos Bank also have an excellent record in supporting renewable energy and are likely to top the table when their UK current account becomes available in early 2017. More information on Triodos appears in their profile on page 26.

What are your options for more ethical everyday banking? asks Ruth Strange.

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Environment Animals People Politics +ve

BRAND COMPANY GROUP

Metro Bank 12.5 H h Metro Bank Plc

Nationwide BS 12.5 H h h E Nationwide Building Society

Norwich & Peterborough BS 12.5 H h h E Yorkshire BS

Bank of Cyprus 11.5 H h h h Bank of Cyprus Plc

Co-operative Bank/Smile 11.5 H h h h h H E 1 Co-operative Bank Plc

Al Rayan Bank 11 H h h h h Masraf Al Rayan Q.S.C.

ICICI Bank 9 H h h h h H H ICICI Bank/Deutsche Bank

Virgin Money 9 H h h h h H H Virgin Group Holdings

Handelsbanken 7 H h h h h h h h h h h h h Svenska Handelsbanken AB

Clydesdale/Yorkshire Bank 6.5 h h h h h h H h h h H H National Australia Bank

Danske Bank 6 h h h h h h H h h h h h h H Danske Bank A/S/Møller Fdtn

Bank of Ireland 5.5 H h h h h h h h h h h h h h H Governor & Co of B.o.I.

Santander/Cater Allen 5.5 h H h h H h h H H H H Banco Santander SA

Bank of Scotland 5 h H h h h h h h h h h H H H Lloyds Banking Group Plc

Citibank 5 h h H h h h h h H h h h H H Citigroup Inc

First Trust 5 H h h h h h h h h h h h h h h H Allied Irish Banks Plc

Lloyds/Halifax 5 h H h h h h h h h h h H H H Lloyds Banking Group Plc

TSB Bank 4.5 H h h h h h h h H h h h h h h H Banco de Sabadell SA

First Direct/HSBC 4 h H h h h h h H h h h h H H H HSBC Holdings Plc

M&S Money 3.5 h H h h h h H H H h h h h H H HSBC Holdings/M&S Group

Post Office 3 H h h h h h h h H H h h h h h H H Governor & Co of B.o.I/UK

Tesco Bank 2.5 h H H H h H H H H H h H H Tesco Plc

NatWest/RBS/Ulster/Coutts 2 h H H H h h h H H h H h H H H UK Government

Barclays 1.5 H h H H H h h h H h H h h H H H Barclays Plc

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USING THE TABLESPositive ratings (+ve):

• Company Ethos:

e = full mark,

E = half mark.

• Product Sustainability: Maximum of five positive marks.

See all the research behind these ratings together on www.ethicalconsumer.org. Free to subscribers.

USING THE TABLESEthiscore: the higher the score, the better the company across the criticism categories.

H = bottom rating,

h = middle rating, empty = top rating (no criticisms).

What we really need is financial reform The focus on customer switching as a response to the banking crisis has been criticised by the New Economics Foundation (NEF) as a diversion from more important financial reforms. It says that it is not enough to focus on competition when actually, “What we need is not just more banks, but more banks that are genuinely capable of putting customers first rather than shareholders.”

“We’re still far too reliant on big, London-based, shareholder-owned banks that all look and act the same way, and are all likely to get in trouble at the same time if something goes wrong.” said NEF.1

In its February 2016 report, ‘Our Friends in the City’, NEF argue that the ‘ring-fence’ the biggest banks will have to put up between their retail and investment arms would probably not protect us from a future bank bailout, and that “full structural separation between retail and investment banking must be reconsidered”. Most companies on the Current Accounts table were marked down under Political Activities for being members of the British Bankers’ Association (BBA) which lobbied to prevent this separation.

An even more fundamental reform is gradually getting more attention, and that is taking the power of money creation – and allocation – away from private banks. It’s complicated to explain, but most of the money in the system is created digitally, when a bank makes a loan, and they decide where to channel that money. Most of it goes into property and financial speculation which pushes up house prices and makes a minority of people very rich. If money were in the hands of a publicly accountable body, it could be run in the public interest, to benefit everybody.

In December 2015, UK organisations including NEF and Positive Money were celebrating the handing in of a huge petition in Switzerland which will trigger a national referendum on the subject. Although it will almost certainly be opposed by the banks, this referendum “offers perhaps the greatest opportunity we’ve seen in Europe for a fundamental rethink of the current monetary system”.4

You can find out more, and sign the petition for a fundamental rethink of the UK banking system too, at act.positivemoney.org/page/s/petition-money-commission.

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Switching to a better accountOne of the official responses to the 2008 crisis has been support for customers to switch accounts. This was supposed to encourage competition in the market and, in 2013, a 7-day switching service was introduced which makes switching safer, quicker and easier. Over 40 banks and building societies are signed up to the service, including our recommended providers Co-op/Smile and Nationwide. These three also came in the top five for best customer service according to users of moneysavingexpert.com. Other providers will usually have an account switching service to help you but it may take longer.

For a high-street bank with a positive stance in favour of renewables and against fossil fuels,

we recommend The Co-operative Bank (and their

online bank Smile).The two national building

societies, Nationwide and the Norwich & Peterborough, also offer excellent current accounts and avoid investing your money in the most controversial business areas. You may have a local building society too.

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References: 1 www.neweconomics.org/blog/entry/how-to-put-banking-reform-back-on-the-political-agenda 2 www.alrayanbank.co.uk/media/288419/ethical-banking-for-everyone.pdf 3 www.neweconomics.org/publications/entry/our-friends-in-the-city 4 www.neweconomics.org/blog/entry/who-should-be-responsible-for-creating-money 5 http://moveyourmoney.org.uk/wp-content/uploads/2014/10/Move-Your-Money-Divest-Full-Report.pdf 6 www.banktrack.org/show/pages/equator_principles 7 www.home.barclays 8 www.neweconomics.org/publications/entry/where-does-money-come-from

bailouts after the 2008 financial crisis, but show little sign of changing their ways.

Mutuals and other alternativesFortunately there are better alternatives. Fewer building societies appear to offer current accounts nationally these days, but joint top of our table are two which do – Nationwide, and Norwich & Peterborough. There is more on mutuals in our guide to savings accounts on page 21.

New current accounts with local credit unions, which will hopefully be available in 2017, will also be a top recommendation when they come on stream. We have a separate feature on credit unions explaining more about this on page 24.

Widespread failure in bank ethicsSadly, most banks score pretty poorly on our table. Where a bank held investments in, or provided banking services for, companies Ethical Consumer had criticised, we marked them down. For example, HSBC lost marks for being listed in Don’t Bank on the Bomb’s Hall of Shame (see page 21), for having current loans to 12 nuclear weapons manufacturers.

All the banks on the table – except Metro Bank and Al Rayan Bank – lost marks for connections to likely tax avoidance. Either they or their parent company or major shareholders had subsidiaries in tax havens that did not appear to be serving local populations, or they appeared to be facilitating tax avoidance for others. In the case of the Post Office, it was the tax-haven subsidiaries of the Bank of Ireland that caused the problem, as it is the BoI that provides its current accounts.

More than half the banks were marked down for excessive pay within their company group (see table below).

Many banks have also pursued an aggressive sales culture which has resulted in compensation payouts of billions for mis-selling of Payment Protection Insurance (PPI), and all of the ‘big five’ except Santander sucked up billions in

11.5

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Banks with directors’ remuneration over £1million

Bank Company GroupGroup’s highest pay for

one person in 2015

Citibank Citigroup £11 million

Bank of Scotland/Halifax/Lloyds Lloyds £8.77 million

HSBC/First Direct/M&S Money HSBC £7.3 million

Santander/Cater Allen Santander £6.1 million

Tesco bank Tesco plc £4.1 million

Co-operative/Smile Co-operative Bank £3.8 million

NatWest/RBS/Ulster/Coutts Royal Bank of Scotland £3.78 million

Barclays Barclays £3.39 million

Clydesdale/Yorkshire Bank National Australia Bank £2.6 million

Virgin Money Virgin Money £1.6 million

Danske Bank Danske Bank £1.2 million

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Current accountsJULY/AUGUST 2016 ethicalconsumer.org

ProductGUIDE

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Planning for your secure future without repression, pollution or exploitation

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Research conducted by Ethical Consumer has found that Barclays, HSBC and Lloyds all offer banking services to companies with licenses to test new potential fracking sites in the UK.

The table opposite lays out which bank is used by which fracking company and for what purpose.

Previous research on banks and frackingThe ‘Frack Off ’ network list Barclays and HSBC as major players pushing fracking in the UK.

Third Energy, with Barclays as its ultimate parent company, was given planning permission in May 2016 to frack for shale gas in Ryedale, North Yorkshire. Actual fracking has not taken place in the UK since 2011. HSBC is also listed as a shareholder in fracking firm Dart Energy, to which it has lent £63 million. HSBC also helped BG Group raise €1 billion.6

Move Your Money listed the position on fracking of the ‘big five’ UK banks, which revealed that Lloyds had also raised and loaned money for fracking companies, and is a shareholder in them. RBS has said that it is committed to finance fracking. Santander said its energy policy is not public.7

What can be done?You may want to look at closing any accounts you have with the banks that support fracking and to write to them telling them why.

The Petroleum Exploration Development Licences (PEDLs) given out in December 2015 don’t, in themselves, give a company the right to begin fracking. If the initial exploration finds what they are looking for, a company still has to go through many stages of surveys, land acquisition, planning applications and consultation. All the currently active exploration sites in the UK have the community mobilising against them.

Fracking bankers

And according to Frack Off, if a license has been given in your area, “The sooner you start raising awareness and get people to take action, the better your chance of slowing them down and stopping them...

References: 1 frack-off.org.uk/faq/what-are-the-new-14th-round-licences-targeting 2 frack-off.org.uk/mounting-evidence-the-harm-caused-by-fracking 3 www.theguardian.com/environment/2016/apr/13/uk-governments-fracking-definition-could-allow-drilling-without-safeguards 4 www.foe.co.uk/sites/default/files/downloads/all-glitters-critique-fracking-regulation-46660.pdf 6 frack-off.org.uk/locations/bad-guys/#anchor-8 7 http://moveyourmoney.org.uk/wp-content/uploads/2014/10/Move-Your-Money-Divest-Full-Report.pdf 8 Registration of a Charge form for INEOS Holdings Limited 9 2014 Accounts of Cuadrilla Resources Holdings Ltd p39 10 2014 Accounts of GDF Suez Energy UK Ltd p2. Name change 27.1.16 11 2014/15 Accounts of IGas Energy plc p109 12 www.egdon-resources.com/investors/advisors 13 2014 Accounts of Celtique Energie Ltd p19 14 2015 Annual report of Barclays plc 15 2015 Accounts of Infrastrata plc p3.

Who are the fracking bankers?

We looked at the 10 fracking companies that had gained the most in the latest licensing round. Banking details were not found for South Western Energy (23 blocks), Hutton Energy (6 blocks), or Aurora Energy Resources (5 blocks).

Fracking companyLand blocks licensed in Dec 2015

Banking services linkAlready active exploration site

INEOS 38Barclays acted as “Security

Agent” in transactions8

Cuadrilla Resources 18 HSBC9 Lancashire

ENGIE Supply (was GDF Suez)

13 Barclays10

IGas Energy 9 Barclays11 Nottinghamshire

Egdon Resources 6 HSBC12

Celtique 5 HSBC13

Third Energy 5A Barclays subsidiary owns

74% of Third Energy14Yorkshire – permission

given to frack May 2016

InfrastrataLloyds Banking Group through

Bank of Scotland15 County Antrim

The single most significant factor in what happens next is the community response in your area”.

See if fracking is planned near you, at frack-off.org.uk/locations/regions

What’s wrong with fracking?“At a time when we should be rejecting the use of fossil fuels (coal, gas and oil), a UK-wide ‘dash for gas’ makes no sense”, says the extreme energy action network Frack Off. Fracking has also been accused of distracting energy firms and governments from investing in renewable energy.

As well as concerns around climate change, there are worries about the safety of fracking. In the USA, where fracking is well underway, there have been thousands of cases of water contamination; increased air pollution has been recorded in five states, and there are even reports of radioactive contamination and earthquakes.2

Communities have been told by government and industry that we can avoid the dangers of fracking experienced by other countries if we regulate it properly. But the Guardian reported in April 2016 that the UK Government’s legal definition of fracking contains a loophole that would allow companies to bypass safety regulations. According to a leading geologist, between 2000-2010 43% of US wells fracked for gas, and 89% fracked for oil would not be defined as fracking under UK rules.3

Even with the best regulation in the world, say Friends of the Earth, we can only make fracking “safer but not safe. And, for climate change reasons, fracking would still not be the answer to the UK’s energy problems.”4

Three of the UK’s largest banks have clear relationships with the controversial fracking industry. Ruth Strange explains more.

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ProductGUIDE

At Move Your Money we focus on banks as institutions, looking at the power that they wield, the purposes that they

put it to, and the ways in which we

can disrupt and reverse these processes by taking

action on the banking system.Now when it comes to climate change,

the biggest banks are at least as bad as the fossil fuel producers in driving global warming. They actively work to promote and expand fossil fuel production and exploitation, and seek to profit from it.

Indeed, without banks and financiers, most fossil fuel projects would not get off the ground at all. This is because fossil fuel projects require a massive amount of expenditure up front to dig up those fossil fuels, before they can be sold on, profited from, and, ultimately, burned.

And that’s where banks come in – they provide the finance, funding, and facilities that make this process possible. As a result, if we can break the stream of finance to fossil fuel companies, then we can break the cycle that is hurtling humanity towards climate chaos. With no money in the till, the producers cannot drill.

The Ethical Banking ScorecardSo to help break the toxic link between banks and fossil fuels, Move Your Money has run a number of campaigns in this area, as well as continuing to support others in this space.

This started in 2013 when we released our first holistic Ethical Banking Scorecard, produced in partnership with Ethical Consumer, which measures and ranks over 70 UK banks and building societies on their ethical and sustainable credentials.

The scorecard tracks 27 different metrics across 5 different areas for each financial institution, which includes funding for Arctic oil and investments in new coal projects as two of those metrics.

The Move Your Money campaignFionn Travers-Smith, Campaign Manager of Move Your Money, explains how the group is increasingly turning its attention to the climate change impacts of banks.

banks, and into fossil-free alternatives. We also threw ‘divestment parties’ in seven cities across the UK, raising the profile of the issue and encouraging even more people to take action to save our habitable planet.

Most recent campaignMore recently, we’ve been campaigning for HSBC to #QuitCoal when they release their new metals and mining policy. Since its last release, HSBC has been making a lot of noise recognising stranded assets (stocks and shares that have become valueless) and the risks of climate change

By using the Scorecard, you can choose to bank with more ethical and sustainable providers, knowing that your money is not being used to fund climate change.

The Divest campaignIn 2014 we then launched our Divest campaign, which profiles just how much the big banks pour into fossil fuels – £66 billion into fossil fuel extraction in 2012 alone (see table below).

The campaign also profiles just how much the big banks are promoting fracking, showing their stated positions on fracking as well as their relationships with fracking companies – because as we all know, actions speak louder than words.

Once again, the focus wasn’t just on exposing information on bank funding of fossil fuels, but to take action to end it. So we convinced over 2,500 people to move their money away from fossil fuel funding

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to the global economy, as well as signing up to the COP21 Paris Pledge.

In response, we’ve helped hundreds of people write to the bank to pressure them to turn their words into action, and to ditch coal funding completely from their portfolio. We took this message directly to the HSBC board at this year’s AGM.

Finally, we’ve also remained active in holding other big banks to account for their climate funding, and for calling out the worst offenders in this space. RBS, for example, was recently lauded by campaign groups for apparently cutting its support for fossil fuels by 70%. Move Your Money was one of the only organisations to point out that this reduction in fossil fuel funding was simply because RBS has sold its loan book to Japanese bank Mizuho, meaning that there has actually been no real reduction in the amount of fossil fuel projects that are receiving funding.

In so much as actions speak louder than words, this is a technical but crucial difference – and one that Move Your Money will continue to expose.

Photos from actions supporting Move Your Money’s Divest campaign which calls for banks to stop funding fossil fuels and climate change. The campaign gives banks a simple ultimatum: either they disclose their investments and vow to take consumers’ money out of fossil fuels, or consumers will take their money out of their accounts.

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Undermining our futureA report from Fair Finance Guide International launched late last year called ‘Undermining Our Future’ showed, perhaps not unexpectedly, that the mainstream banking industry is overwhelmingly supporting the fossil fuel sector.

The UK’s biggest five banks for consumers, HSBC, Barclays, RBS, Lloyds and Santander all feature in the top 25 of banks investing in fossil fuels (see table below).

The report covered a ten year period from 2004 to 2014 and also showed that although the proportion of its funding for renewables increased towards the end of the period, it still falls well short of the investment that is needed.

Fair Finance Guide carbon ranking

“The investments of today determine the world of

tomorrow. Financing is what has to move first.”

About the reportThe report measured the trends within financial institutions towards finance for companies engaged in fossil fuels (coal mining and oil & gas) and renewable energy projects (solar, wind and

geothermal).1 The full report runs to 313 pages, looks at 75 financial institutions, and has identified more than 14,000 transactions.

Overall, the report found some positive movement: the “25 biggest financial institutions increased financing of… renewable energy and renewable energy projects by 35% compared to the first half [of the study]. However, at the same time, they also increased their funding to the selected companies attributable to fossil fuels by 1%”.

The whole report is free to download from the fairfinanceguide.org website.

References: 1 The following sectors were excluded: Bioenergy (biofuel & biomass), Hydro power, Nuclear power, Tidal Energy http://fairfinanceguide.org

About FFGIFair Finance Guide International (FFGI) is a global coalition launched in 2014 to create ethical rankings for banks based on common criteria. Like Ethical Consumer it seeks to use ranking as a lever for change and to drive up best practice in a ‘race to the top’.

FFGI was initiated by Oxfam and Amnesty in the Netherlands and is funded by the Swedish Agency for International Development. It is therefore able to direct substantial resources to this project. It currently has online rankings live or in preparation in eight countries: Belgium, Brazil, Denmark, France, Netherlands,, Norway, India, Indonesia, Japan and Sweden. Each ranking is prepared by a country coalition, which often includes development and human rights organisations, labour unions, environmental groups, and consumer organisations.

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Figure 9 Ranking of the top financiers of the selected companies attributable to fossil fuels (loans & underwriting, US$ mln, 2009-2014)

Table 8 provides an overview of the loans and underwriting to the selected companies attributable to fossil fuels and renewable energy. It shows that for 23 of the 25 financial institutions the proportion of fossil fuels in their total loans and underwriting to the selected companies attributable to renewable energy and renewable energy projects and fossil fuels was higher than 80%. For 15 this proportion was over 90%. This indicates the huge disparity between the financing of renewable energy and fossil fuels. Table 8 also shows the change in the proportion of fossil fuels in relation to the total loans and underwriting to the selected companies attributable to renewable energy and renewable energy projects and fossil fuels from the first half of the period of study (2004-2009) to the second half of the period (2009-2014). A negative percentage indicates a decline in the proportion attributable to fossil fuels. A positive percentage indicates an increase in the proportion of fossil fuels in their total loans and underwriting to the selected companies attributable to renewable energy and renewable energy projects and fossil fuels. More than half of the researched financial institutions decreased the proportion of fossil fuels in their total loans and underwriting to the selected companies attributable to renewable energy and renewable energy projects and fossil fuels from the first half of the period of study (2004-2009) to the second half of the period of study (2009-2014). However, these decreases were on the whole very small, not exceeding 10%. 10 financial institutions actually increased the proportion of fossil fuels in their total loans and underwriting to the selected companies attributable to renewable energy, renewable energy projects, and fossil fuels from the first half of the period of study (2004-2009) to the second half of the period of study (2009-2014).

Top 25 banks’ investments in selected fossil fuel and renewables companies (US$ million, 2009–2014)

Anna Clayton identifies your options for personal savings accounts that drive sustainable realities.

In this guide we focus on how you can divest from fossil fuels and help foster climate-mitigation projects using your personal savings and some innovative banks and mutuals. Many of the companies featured on the accompanying saving accounts rankings table also appear in our guide to current accounts. We cover many of these companies and the issues associated with them in that guide on page 13.

There are several savings accounts available that can be trusted to drive climate solutions: Ecology Building Society, Triodos and Charity Bank each get a positive Company Ethos mark and Product Sustainability mark on our rankings table for offering a social and environmental alternative to the mainstream banking industry. The Co-operative Bank also continues to have an ethical investment policy, although it does not score so well overall in our rankings.

Ecology Building Society focuses its lending on projects that offer the greatest gains in terms of carbon reductions and environmental impact, with its ethical lending policy prioritising: sustainable housing practices, sustainable lifestyles, sustainable economic activity, and other ecologically positive projects and ventures.

Triodos and Charity Bank both have ethical investment policies that support low-carbon initiatives, and both publicly disclose their investments – a great practice for a sector that is resistant to openness and accountability.

Triodos offers financial services to a range of projects including organic food and farming businesses, renewable energy enterprises, recycling companies and nature conservation projects. And Charity Bank publishes an annual ‘loan portfolio report’ which, in 2015, included a couple of renewable energy projects. Charity Bank only lent to charities, social enterprises and organisations with a charitable purpose, and stated that it conducted a social impact assessment for each loan.

Saving for a ‘greener’ tomorrow

Mutuals and other accounts for saversMutu als and credit unions are often considered to be ‘safe havens’ for ethical banking – scoring well in a number of ranking exercises including Move Your Money’s and our own Ethiscore ranking.

In our rankings, building societies all get a positive Company Ethos mark for being mutuals, i.e. owned by and run for their members. All customers are members and are able to vote at AGMs or stand for election to be on the Board. This is unlike banks which are run for external shareholders.

Building societies also don’t deal with the volatile world of commodities, currencies and derivatives, but focus on residential mortgages and loans. For example, none of the mutuals covered in this report had investments in the fossil fuel industry, they only lent on residential properties. And when looking at tax-avoidance strategies, all mutuals, with the exception of Skipton Building Society, score a best in our rankings.

However, since 2014 (when we last covered ethical finance in EC147), discourse within the climate divestment movement has increasingly considered not only what banks avoid (i.e. not investing in fossil fuel companies), but also what banks are actively investing in.

To assist the transition towards a low-carbon economy, banks are increasingly expected to invest in climate solutions and

support initiatives that enable the low-carbon transition. When this is taken into account, the mutuals covered in this guide don’t perform so well, with the exception of Ecology Building Society. All score a worst in our Environmental Reporting category, and none, except Ecology, appear to finance climate mitigation projects.

To find your local building society search the members list on the Building Societies Association website, www.bsa.org.uk/about-us/members-of-the-bsa.

Don’t Bank on the BombIn November 2015, the International Campaign to Abolish Nuclear Weapons (ICAN) launched its latest ‘Don’t Bank On the Bomb’ report,1 reviewing the financing of the nuclear weapons industry by financial institutions. A number of the banks covered in this magazine had invested millions of US dollars in nuclear weapons producers since 2012, including:

Citigroup ($14.449 billion) The Royal Bank of Scotland ($6.973 billion)Barclays ($5.881 billion)Invesco ($5.413 billion)HSBC ($4.469 billion)Lloyds Banking Group ($1.921 billion)Banco Santander ($1.675 billion)ICICI Bank ($760 million)Danske Bank ($299 million)Banco de Sabadell ($29 million)

By lending money to nuclear weapons companies, and purchasing their shares and bonds, banks and other financial institutions, companies and consumers are argued to be “indirectly facilitating the build-up and modernisation of nuclear forces, thereby heightening the risk that one day these ultimate weapons of terror will be used again – with catastrophic humanitarian and environmental consequences.” ICAN is therefore calling for a co-ordinated global campaign for nuclear weapons divestment.

Of all the banks covered in this guide, only Triodos and The Co-operative

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Environment Animals People Politics +ve

BRAND COMPANY GROUP

Ecology Building Society 16 e 1 Ecology Building Society

Charity Bank 14.5 h 1 Charity Bank Ltd

Triodos Bank 14 h h h E 1 SAAT

Coventry Building Society 13.5 H E Coventry Building Society

Cumberland Building Society 13.5 H E Cumberland Building Society

Leeds Building Society 13.5 H E Leeds Building Society

Newcastle Building Society 13.5 H E Newcastle Building Society

Principality Building Society 13.5 H E Principality Building Society

West Bromwich Building Soc 13.5 H E West Bromwich Building Soc

Skipton Building Society 13 H h E Skipton Building Society

Chelsea Building Society 12.5 H h h E Chelsea BS/Yorkshire BS

Kent Reliance 12.5 H h OneSavings Bank/JC Flowers

Metro Bank 12.5 H h Metro Bank Plc

Nationwide BS 12.5 H h h E Nationwide Building Society

Norwich & Peterborough BS 12.5 H h h E Yorkshire Building Society

Yorkshire Building Society 12.5 H h h E Yorkshire Building Society

Bank of Cyprus 11.5 H h h h Bank of Cyprus Plc

Co-operative Bank/Smile 11.5 H h h h h H E 1 Co-operative Bank Plc

Al Rayan Bank 11 H h h h h Masraf Al Rayan Q.S.C.

ICICI Bank 9 H h h h h H H ICICI Bank/Deutsche Bank

Virgin Money 9 H h h h h H H Virgin Group Holdings

Handelsbanken 7 H h h h h h h h h h h h h Svenska Handelsbanken AB

Clydesdale/Yorkshire Bank 6.5 h h h h h h H h h h H H National Australia Bank Ltd

Danske Bank 6 h h h h h h H h h h h h h H Danske Bank A/S/Møller Fdtn

Bank of Ireland 5.5 H h h h h h h h h h h h h h H Governor & Co of B.o.I.

Santander/Cater Allen 5.5 h H h h H h h H H H H Banco Santander SA

Bank of Scot./Birm. Midshires 5 h H h h h h h h h h h H H H Lloyds Banking Group Plc

Citibank 5 h h H h h h h h H h h h H H Citigroup Inc

First Trust 5 H h h h h h h h h h h h h h h H Allied Irish Banks Plc

Lloyds/Halifax/Scottish Wid. 5 h H h h h h h h h h h H H H Lloyds Banking Group Plc

TSB Bank 4.5 H h h h h h h h H h h h h h h H Banco de Sabadell SA

First Direct/HSBC 4 h H h h h h h H h h h h H H H HSBC Holdings Plc

M&S Money 3.5 h H h h h h H H H h h h h H H HSBC Holdings/M&S Group

Sainsbury’s Bank 3.5 h H H h H H h H h H h H H J Sainsbury Plc

Post Office 3 H h h h h h h h H H h h h h h H H Governor & Co of B.o.I/UK

Tesco Bank 2.5 h H H H h H H H H H h H H Tesco Plc

NatWest/RBS/Ulster/Coutts 2 h H H H h h h H H h H h H H H UK Government

Barclays 1.5 H h H H H h h h H h H h h H H H Barclays Plc

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USING THE TABLESPositive ratings (+ve):

• Company Ethos:

e = full mark,

E = half mark.

• Product Sustainability: Maximum of five positive marks.

See all the research behind these ratings together on www.ethicalconsumer.org. Free to subscribers.

USING THE TABLESEthiscore: the higher the score, the better the company across the criticism categories.

H = bottom rating,

h = middle rating, empty = top rating (no criticisms).

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Bank were listed in ICAN’s Hall of Fame for having an all-inclusive policy that excluded all types of investments in nuclear weapons companies (withdrawing past investments and avoiding future investments).

Let’s talk about taxIn March 2016, Ecology Building Society became the first building society to have received the Fair Tax Mark, demonstrating the Building Society’s openness and transparency regarding its tax affairs. Unfortunately, this positive news runs counter to the secrecy and aggressive tax dodging that continues to pervade the rest of banking sector.

Companies that scored a worst Ethical Consumer ranking for likely use of tax avoidance strategies include: The Co-operative Bank, ICICI Bank, Virgin Money, Handelsbanken, Clydesdale Bank, Yorkshire Bank, Danske Bank, Bank of Ireland, Banco Santander, Lloyds Banking Group, Citigroup, First Trust Bank, TSB, HSBC, Sainsbury’s Bank, Post Office Accounts, Tesco Bank, Coutts, NatWest, The Royal Bank of Scotland, Ulster Bank, Barclays and Triodos.

Skipton Building Society had one subsidiary based in a tax haven that did not appear to be serving the local population. As a result, it received Ethical Consumer’s middle ranking for likely use of tax avoidance strategies. The Bank of

Due to their high Ethiscores, their lack of investment in fossil fuels and

their commitment to investing in climate

solutions, Best Buys for savings accounts are (interest rates in brackets):

Ecology Building Society: Easy Access Account (1%), Regular Savings Account (1.75%)Charity Bank: Savings Account (0.5-1%), Community Account (0.7-1.7%), Small Steps Account (2.02%)Triodos: Savers Accounts (0.05-0.1%), Online Saver (0.3-1%), Fixed Regular Saver (1.75%), Right Start Saver (0.8%)

Interest rates are currently low across all savings accounts as the Bank of England’s Monetary Policy Committee has kept the official bank rate low to encourage more borrowing and spending to help it meet its inflation target.

Ethical Consumer also recommends the building societies covered in this guide, in addition to the smaller building societies and credit unions (see page 24).

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References: 1 Don’t Bank On The Bomb, November 2015, www.dontbankonthebomb.com. (Quoted figures are the sum of money in US dollars made available to nuclear weapons producers listed in ICAN’s report since January 2012) 2 fairfinanceguide.org/media/60908/ffg-report-151102-undermining-our-future-final.pdf

Cyprus also appeared to be facilitating tax avoidance via its bank in the Channel Islands, and consequently lost half a mark under the Anti-Social Finance category.

Charity Bank, Nationwide, Al Rayan Bank, Metro Bank, and the Nationwide, Coventry, Cumberland, Leeds, Newcastle, Principality, Yorkshire, and West Bromwich building societies didn’t appear to use tax avoidance strategies.

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RBS has been accused of making money from weapons of mass destruction after it was named as the biggest financial backer of nuclear bombs in the UK. In the last four years up to 2015, RBS has lent £4.5 billion to 21 major companies involved in nuclear weapons.

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Credit unions are a model that has worked as a way to provide mutual self-help in around 100 countries. Today, there are 57,000 credit unions around the world enabling 217 million members to access affordable financial services. In some countries they are a much bigger part of the consumer ‘banking’ sector than they are in the UK. In Ireland, for example, over 70% of the population belong to a credit union. In America and Canada the figure is around 43%.

Credit unions can be set up by any group of people with a ‘common bond’, usually location, but sometimes trade (such as taxi drivers) or association (such as a church group).

They are mutuals, so that as well as being savers or borrowers, those who join become members who have a right to participate in decision-making. Credit unions’ main purpose is to provide affordable loans and safe savings to their members, as well as educating members on managing their own finances. Members pool their savings, allowing loans to be made to other members.

They specialise in issuing personal loans – normally between £50 and £3,000 – and you can commonly save up to £10,000 in one too. Rather than interest, an annual dividend of between 0% and 5% is paid to all savers (1% appears common at present).

There’s a great website at www.findyourcreditunion.co.uk run by ABCUL – the Association of British Credit Unions – where typing in your postcode generates a list of the possible credit unions you could belong to, with links to follow up any interesting leads. Alternatively, you can call ABCUL on 0161 832 3694 to find out which unions you could save with.

Credit unions are covered by the Financial Services Compensation Scheme, so savings (up to £75,000 per person) are not at risk although most limit the total you can save with them to much below this.

Current accounts at credit unionsIn the US and elsewhere, some credit unions offer full banking facilities and have grown to become much like building societies in the UK.

Saving with credit unionsIn our last product guide to Current

Accounts in 2014, we mentioned that 25 of the larger British credit unions offered basic current accounts and that these were also a good option.

These accounts were operated through, and administered by, the Co-operative Bank. However, changes at The Co-operative Bank (see page 34) mean that this arrangement has now come to an end and so, unfortunately, they are not currently available.

We asked the Co-operative Bank and ABCUL for comment and they said:

“Agreement is being sought to close the Credit Union Current Account product, and there is ongoing dialogue between The Co-operative Bank, ABCUL and the credit unions who offer it with a view to bringing about the smoothest and best conclusion to the provision of this product. The credit unions involved are considering solutions which could mean their combined 32,000 current account customers can transfer

Credit union statisticsThere are around 340 credit unions across England, Scotland and Wales.

1,269,345 people are credit union members, including over 130,000 junior savers.

£1.17 billion is saved in British credit unions.

£769 million is out on loan to members.

Some credit unions offer mortgages, cash ISAs and insurance products.

From the latest Bank of England statistics www.abcul.org/media-and-research/news/view/699 as at 5 May 2016

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to a similar product, and are looking at a number of potential alternative products for transactional banking and payments.”

The new London Mutual Credit Union branch in Southwark is equipped with its own ATM service, five spacious counters and an iPad stand where members can join the credit union, apply for low cost loans and carry out other online transactions. ©

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(out of 20)

Ecology Building Society 16

Coventry Building Society 13.5

Cumberland BS 13.5

Leeds Building Society 13.5

Newcastle Building Society 13.5

Principality Building Society 13.5

West Bromwich BS 13.5

Skipton Building Society 13

Chelsea Building Society 12.5

Kent Reliance 12.5

Metro Bank 12.5

Nationwide BS 12.5

Norwich & Peterborough BS 12.5

Yorkshire Building Society 12.5

Co-operative Bank 11.5

Smile 11.5

Al Rayan Bank 11

Virgin Money 9

Handelsbanken 7

Clydesdale Bank 6.5

Yorkshire Bank 6.5

Danske Bank 6

Bank of Ireland 5.5

Santander 5.5

Bank of Scotland 5

Birmingham Midshires 5

First Trust 5

Lloyds 5

Halifax 5

Scottish Widows 5

TSB Bank 4.5

First Direct 4

HSBC 4

Post Office 3

Tesco Bank 2.5

Coutts 2

NatWest 2

RBS 2

Ulster 2

Barclays 1.5

Mortgages

BRANDEthiscore

(out of 20)

Ecology Building Society 16

Charity Bank 14.5

Triodos Bank 14

Coventry Building Society 13.5

Cumberland Building Society

13.5

Leeds Building Society 13.5

Newcastle Building Society 13.5

Principality Building Society 13.5

West Bromwich Building Soc

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Skipton Building Society 13

Chelsea Building Society 12.5

Kent Reliance 12.5

Metro Bank 12.5

Nationwide BS 12.5

Norwich & Peterborough BS 12.5

Yorkshire Building Society 12.5

Bank of Cyprus 11.5

Co-operative Bank/Smile 11.5

Al Rayan Bank 11

Virgin Money 9

Handelsbanken 7

Clydesdale/Yorkshire Bank 6.5

Danske Bank 6

Santander 5.5

Bank of Scot./Birm. Midshires

5

First Trust 5

Lloyds/Halifax/Scottish Wid. 5

TSB Bank 4.5

First Direct/HSBC 4

M&S Money 3.5

Sainsbury’s Bank 3.5

Post Office 3

Tesco Bank 2.5

NatWest/RBS/Ulster/Coutts 2

Barclays 1.5

Cash ISAs

Cash ISAsThe Best Buys for cash ISAs are: • The Charity Bank only lends to charities, social enterprises and organisations with a charitable purpose. • Triodos also only lends to social and environmental projects and has an ethical investment policy. • The Ecology Building Society only lends to sustainable housing and property projects. Its ISAs are only currently available to “individuals who were members of the Building Society on 25 September 2015 and have not ceased being a member since this date.”

For those not already members of the Ecology Building Society one of the other building societies will also be a good option.

For more widely available cash ISAs we recommend Nationwide Building Society as it is a mutual.

MortgagesThe clear Best Buy for mortgages is The Ecology Building Society. As it only lends to sustainable housing and property projects this option will not be available to everyone. Check their criteria out at www.ecology.co.uk/mortgages/lending.

Depending on the area where you want to buy the house a good alternative will be a mutual. Coventry, Cumberland, Leeds, Newcastle, Principality and West Bromwich Building Societies come out best on our score table but only lend in certain areas.

A good more widely available option is the Nationwide Building Society.

Always consult an independent mortgage adviser before choosing your mortgage.

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Detailed scorecards and more info on our website:

Mortgages – www.ethicalconsumer.org/buyersguides/money/mortgagesCash ISAs – www.ethicalconsumer.org/buyersguides/money/cashisas

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Two mini guides with Best Buys advice and cut-down score tables. The full guides are on our website.

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Contrary to its name, Charity Bank is no longer a charity but is a bank owned by charitable trusts, foundations and social purpose organisations. Shareholders include Esmée Fairbairn Foundation, The National Council for Voluntary Organisations, The Vodafone Foundation, and RBS Social and Community Capital. Charity Bank scores a best rating in Ethical Consumer’s Environmental Reporting category, and is considered to be providing a social and environmental alternative to the mainstream banking sector.

A long-time favourite of Ethical Consumer readers, Triodos Bank has been at the cutting edge of sustainable banking in the UK for more than 20 years. Its practice of publishing details of all its loans – even with an interactive google map these days – is one which we would like to see the whole banking sector follow.

The company however does have three medium risk company types in Luxembourg, a known tax haven, and for this reason scores a middle rating for our “use of likely tax avoidance strategies” category.

In a statement to Ethical Consumer on the subject Triodos said, “the reason for the Luxembourg registration for our SICAV funds is because it provides these funds a European passport, which enables us to distribute these funds in all countries where Triodos has branches. If the funds would for instance be registered in the Netherlands, that would not be possible.”

The Royal Bank of Scotland (RBS) said it would not finance any new tar sands projects from April 2016. In December it had stopped lending to mining companies whose sole focus was coal. However, most of the biggest coal producers were not affected by this policy as they are diversified and operate in other sectors, not just coal. Fionn Travers-Smith from the Move Your Money campaign said “If RBS wants to be taken seriously as an environmental bank it must divest completely from fossil fuels”. See photo on the right and the MYM article on page 18.

Lloyds Banking Group is currently the largest retail bank in the United Kingdom and one of the five biggest UK banks to be targeted by the Move Your Money campaign over its investments in fossil fuels. According to the ‘Undermining Our Future’ report published in November

The companies behind the brands

2015 (see page 20), Lloyds Banking Group gave $10.047 billion in loans and underwriting to selected fossil fuel companies compared to $2.664 billion to selected renewable energy projects during the second half of the report’s study period (2009-2014). Lloyds is also involved in projects and activities that are considered by BankTrack to be “problematic in the light of the sustainability commitments of this bank”, including Cerrejón coal mine in Colombia and the Great Barrier Reef Coal and Gas Exports.1

Santander is also involved in a number of ‘dodgy deals’ including mountain-top-removal coal mining in the United States, the Punta Catalina-Hatillo coal power project in the Dominican Republic and the Rio Madeira dams in Brazil.3 According to the ‘Undermining Our Future’ report, Santander gave $14.113 billion in loans and underwriting to selected fossil fuel companies compared to $7.921 billion to selected renewable energy projects during 2009-2014.

See page 20 for more information about the Undermining Our Future report.

Al Rayan Bank is a Living Wage employer. According to its 2016 report ‘Ethical Banking for Everyone’: “it was better protected from the recent global

banking crisis than conventional banks because its method of banking, where investment must be in tangible assets and not financial instruments based on speculation, did not create the ‘toxic’ assets that were recognised as a root cause of the crisis”.

It was also stated in this report that: “The source of an Islamic bank’s funding, profits and business investments must be ethical. They cannot be from businesses that are considered unlawful under Sharia, i.e. companies that deal in interest, alcohol, gambling, pornography, speculation, tobacco, arms and other commodities contrary to Islamic values.”2

A May 2016 ‘Global Market Snapshot’ was downloaded from the website of Al Rayan Bank’s parent company, Masraf Al Rayan, showing investments it may be involved in, including oil commodities and companies.4

According to its 2014 Annual Report, Masraf Al Rayan, was almost 12% owned by the Qatar Holding Company. This was the same company as Qatar Holding LLC, which owns Harrods, and has significant shareholdings in Sainsbury’s, Heathrow Airport Holdings, and Tiffany & Co.

Metro Bank was launched in 2010 – claiming to be Britain’s first new high street bank in almost 100 years. In 2016

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the bank was floated on the London Stock Exchange and it now has over 40 branches across Greater London and the surrounding areas. Although scoring well, it loses a mark for failing to have any environmental policies reassuring customers about its own behaviour or lending intentions.

Late in 2013 a deal was done to plug a huge gap in The Co-operative Bank’s balance sheet. The deal saved the bank but it left The Co-operative Group with only a minority share, while private investors – including hedge funds – own the rest. According to the Co-operative Bank’s Annual Report: “in May 2014, the Bank entered into a shareholder rights agreement with Silver Point, Perry Capital, Invesco Asset Management Limited and York Capital (collectively the Committed Shareholders), The Co-operative Group and The Co-operative Banking Group.” Silver Point was listed as a shareholder in the Bank’s Annual Report with 12.79% while the Co-operative Group was listed as owning 20% stake in the Bank.

Silver Point’s US filings show that the company has investments in Talen Energy, a company which owns coal fired power stations as well as Susquehanna Nuclear LLC, one of the largest nuclear power plants in the USA.5

The Co-operative Bank receives a worst Ethical Consumer rating for Environmental Reporting due to the fact it did not have two quantifiable dated environmental targets.

Virgin Money Group, which includes the now defunct Northern Rock, is partially owned by the Virgin Group and by WL Ross & Co. (a subsidiary of Invesco). The company picks up marks under Climate Change for Virgin Airlines and the investments of Invesco in big oil companies: Total S.A, Royal Dutch Shell, BP and ExxonMobil.

Handelsbanken is a Swedish bank with retail operations in the UK. Its major investor is the Swedish investment group Industrivärden which is an active owner in other famous Swedish companies including Volvo, Ericsson, Skanska and SSAB. The company has an environmental policy for its mutual funds which do not invest in “companies that have significant operations in coal mining or coal combustion.” The company was considered by Ethical Consumer to have a reasonable understanding of its environmental impacts, however, it did not have two quantifiable dated environmental targets and therefore received a worst rating in the category.

Unity Trust was founded by trade unions which still hold most of its shares. It provides banking services to “organisations, sole traders or individuals that contribute community, economic, social or environmental benefit to society, including, but not limited to, Trade Unions, co-operatives, charitable and commercial enterprises.”

The Co-operative Bank used to own 26.7% of Unity but sold most of this shareholding in 2015 and now only owns 6.7%.

CAF Bank is owned by Charities Aid Foundation, one of the UK’s largest charities. Any surplus CAF Bank makes is gifted to CAF and therefore stays within the charitable sector. CAF works to build support for charities, donors and businesses interested in philanthropy.

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The Clydesdale Bank and Yorkshire Bank lost marks for the activities of their parent company National Australia Bank (NAB), which is 17.96% owned by a subsidiary of HSBC, and 12.3% owned by JP Morgan, the second biggest financier of fossil fuels according to the ‘Undermining our Future’ report (see page 20). Both shareholders caused NAB to lose marks for likely tax avoidance, investments in nuclear weapons, and membership of several free trade lobby groups.

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References: 1 www.banktrack.org/show/bankprofiles/lloyds_banking_group_plc#tab_bankprofiles_dodgydeals 2 www.alrayanbank.co.uk/media/288419/ethical-banking-for-everyone.pdf 3 www.banktrack.org/show/bankprofiles/santander#tab_bankprofiles_companies 4 www.alrayan.com/en/Global-Market-Snapshot 5 www.secinfo.com/d12Pk6.mVYg.d.htmTa

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Lloyds is involved in projects and activities that are considered by BankTrack to be “problematic in the light of the sustainability commitments of this bank”, including Cerrejón coal mine in Colombia.

The ranking table shows 18 providers offering current account facilities to small businesses, social enterprises and charities in the UK. Two further companies, which only offer savings accounts in this sector, are Charity Bank and Nationwide. They have not been covered in this guide but are ranked in the Savings Accounts guide on page 21.

Ethical current accounts for small businesses and charitiesOver the last year or so, Ethical Consumer has been asked by a few small businesses, charities and faith groups to put together a product guide to small business bank accounts. So here it is...

Environment Animals People Politics +ve

BRAND COMPANY GROUP

Triodos Bank 14 h h h E 1 SAAT

Cumberland Building Society 13.5 H E Cumberland Building Society

CAF Bank 13 H h 0.5 Charities Aid Foundation

Unity Trust 13 H h 0.5 Trade Unions

Metro Bank 12.5 H h Metro Bank Plc

Norwich & Peterborough BS 12.5 H h h E Yorkshire Building Society

Bank of Cyprus 11.5 H h h h Bank of Cyprus Plc

Co-operative Bank 11.5 H h h h h H E 1 Co-operative Bank Plc

Al Rayan Bank 11 H h h h h Masraf Al Rayan Q.S.C.

ICICI Bank 9 H h h h h H H ICICI Bank/Deutsche Bank

Clydesdale/Yorkshire Bank 6.5 h h h h h h H h h h H H National Australia Bank Ltd

Danske Bank 6 h h h h h h H h h h h h h H Danske Bank A/S/Møller Fdtn

Bank of Ireland 5.5 H h h h h h h h h h h h h h H Governor & Co of B.o.I.

Santander/Cater Allen 5.5 h H h h H h h H H H H Banco Santander SA

First Trust/Allied Irish Bank 5 H h h h h h h h h h h h h h h H Allied Irish Banks Plc

Lloyds 5 h H h h h h h h h h h H H H Lloyds Banking Group Plc

TSB Bank 4.5 H h h h h h h h H h h h h h h H Banco de Sabadell SA

HSBC 4 h H h h h h h H h h h h H H H HSBC Holdings Plc

NatWest/RBS/Coutts 2 h H H H h h h H H h H h H H H UK Government

Barclays 1.5 H h H H H h h h H h H h h H H H Barclays Plc

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USING THE TABLESPositive ratings (+ve):

• Company Ethos:

e = full mark,

E = half mark.

• Product Sustainability: Maximum of five positive marks.

See all the research behind these ratings together on www.ethicalconsumer.org. Free to subscribers.

USING THE TABLESEthiscore: the higher the score, the better the company across the criticism categories.

H = bottom rating,

h = middle rating, empty = top rating (no criticisms).

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And the others...Of the other, more mid-table choices, The Co-operative Bank is the main stand-out option. As the only company with a highly developed ethical policy, formally ruling out investing in a whole range of areas from fossil fuels to factory farming, you definitely know where your money is going. Its well publicised tricky patch seems to be behind it and it now even has a ‘Customer Union for Ethical Banking’ to keep it on track (see page 34).

Also worth considering are the two mutual building societies, Norwich and Peterborough or Cumberland, which, because of their business models, only invest in residential and other property and will also be effectively divested from carbon.

References: 1 Mintel - Small Business Banking - UK - June 2015 2 Fair Finance Guide International – Undermining our Future - Nov 2015 3 Undermining our Future 2015 Fair Finance Guide Report

Best buys for small business and charity current accounts are the specialist ethical

providers: CAF Bank, Triodos and Unity Trust.

Also worth considering is the Co-operative Bank with its wide-ranging ethical policy.

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Banking on cimate changeThe top five banking groups – HSBC, Lloyds, Barclays, RBS and Santander – control 89% of small business accounts.1

As we say in our current accounts guide (see page 13) these ‘big five’ banks have been criticised by civil society over a range of issues including investment in fossil fuels, tax avoidance, excessive directors’ pay, and for lending to nuclear weapons companies.

The super-ethicalsThe good news is that there are three ‘super-ethical’ choices for current accounts in this sector not available to individual consumers. They are:

CAF Bank – specially for charities and not-for-profits.Triodos – for charities or businesses with a social purpose.Unity Trust – for social enterprises, co-operatives and trade unions.

It may help to know, when choosing between them, that the CAF Bank is more focused on charities, Triodos on environmentally sustainable projects, and Unity Trust on social enterprise, but each crosses over into all these areas to some degree. Although Triodos is the only one to have a formal no-carbon policy, all three, because of their business models, will be effectively carbon divested.

The Charities Aid Foundation also offers investment products to charities via third-party ‘partners’. Disappointingly, not all of these are via ethically-screened funds. However CAF Bank’s own lending remains exclusively to charities and individuals.

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Triodos Bank invests in M-KOPA Solar which enables households in East Africa to buy a solar home system at an affordable price. System includes an LED rechargeable torch, two LED light bulbs and a mobile phone charger.

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HSBC & Barclays present the ‘Fracking Awesome’ Community Steamroller Display Team

The ‘Illusion of Democracy’ national tourChoreography by HM Government

“You’ll gasp at their definition of sustainable

development”

Appearing at shale gas deposits

near you!

MOVE NOW to avoid disappointment (& minor earthquakes)

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Fossil-free ethical fundsWhat are the best options for the ethical investor looking to go fossil free? Rob Harrison and Josie Wexler explore this emerging market.

Fund name Remaining fossil fuel investmentsInvestment

type

FP WHEB SustainabilityHas 1.36% of fund assets invested in China

Longyuan Power Group Corp Ltd and 0.98% of fund assets invested in Hera SpA

Fossil Fired Utilities

AXA Ethical Distribution FundHas 0.61% of fund assets invested in

Hunting PLCOil and gas

industry

Jupiter EcologyHas 1.08% of fund assets invested in China

Longyuan Power Group Corp Ltd and 0.56% of fund assets invested in Greenko Group

Fossil Fired Utilities

ConBrio B.E.S.T. IncomeHas 4.57% of fund assets invested in

National Grid PLC and 3.57% of fund assets invested in SSE PLC

Fossil Fired Utilities

Impax Environmental MarketsHas 1.61% of fund assets invested in ENN Energy Holdings Ltd and 0.58% of fund assets invested in Greenko Group PLC

Fossil Fired Utilities

Quilter Cheviot Climate AssetsHas 3.33% of fund assets invested in

National Grid PLCFossil Fired

Utilities

F&C Responsible Global EquityHas 1.09% of fund assets invested in Spectra

Energy CorpOil and Gas

industry

There is about £15 billion invested in green and ethical funds in the UK.1 However, this is only about 1.2% of the amount invested in ‘mutual funds’ as a whole, a figure that hasn’t budged for a decade.2

This lack of take-up is sad, especially considering the number of studies that have now been done comparing the financial performance of ethical and non-ethical funds. Because overall, the evidence suggests that ethical funds don’t do any worse financially.3

Carbon-divested funds are much newer and so it is harder to know how they are likely to do. And yet an analysis of the five years prior to 2015 suggested that investors who dumped holdings in fossil fuel companies actually outperformed those that did not.4

FossilFreeFunds.orgTo create this guide we used an American website called FossilFreeFunds.org, which allows anyone to easily access information on investment funds’ fossil fuel holdings.

The website awards 5 fossil free ‘badges’. They are:

free of the Filthy 15 (a US-focused list of the top 15 carbon-emitting US coal companies)

1.

free of the Carbon Underground 200 (a list of the top 100 global coal companies and the top 100 oil and gas companies, ranked by the potential carbon emissions content of their reported reserves. The list is maintained by Fossil Free Indexes)free of all Coal Industryfree of all Oil/Gas Industryfree of Fossil-Fired utilities.

2.

3.4.5.

Mainly fossil-free funds

How we picked our list of top funds

The negative side (divestment)

FossilFreeFunds.org lists six UK investment funds that are both socially responsible and fully fossil free, thus being awarded all 5 divestment ‘badges’. They are:

Henderson Global Care GrowthRoyal London Sustainable WorldOld Mutual EthicalSarasin EquiSar Socially Responsible7IM Sustainable BalanceAlliance Trust Sustainable Future European Growth.

The other funds we rated on the table are not 100% fossil free. We included them in the list, however, as they are pretty close and have other positive features such as investing strongly in renewable energy, being rated by Castlefield (see page xx) as an ethically strong fund, or being in ShareAction’s list of most ethically engaged providers (see our 2014 guide to Ethical Funds). The investments of the funds that are not 100% carbon divested, taken from fossilfreefunds.org on 9th May 2016, are listed on the table below.

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In May, hundreds of people shut down a coal mine in Lusatia, Germany.

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The ConBrio B.E.S.T. Income Fund had the highest level of fossil fuel investment out of those we looked at. However, the company told us that it tries to combine negative and positive approaches, and that it invests in SSE plc despite its involvement in fossil fuels because of its significance in the wind power industry and transitioning the UK towards renewable energy.

...and the positive (investment)

The ‘positive’ action of investing in renewable energy is, arguably, as important as the ‘negative’ action of divestment. While all the funds we are looking at have many other kinds of positive investments, the following four funds focus all their positive investments on environmental technologies and renewable energy:

FP WHEB SustainabilityImpax Environmental MarketsQuilter Cheviot Climate AssetsJupiter Ecology.

How we rated the fundsWhen we last rated investment funds in 2014 we didn’t mark companies as having investments in dodgy companies if they were reported as being among the best performing ‘shareholder activists’

••••

Environment Animals People Politics +ve

BRAND COMPANY GROUP

FP WHEB Sustainability 14.5 h h E 1 WHEB LLP

Impax Env. Markets 9.5 H h h h h h h h h h h E 1 Impax Group PLC

Alliance Trust Sust Future Eur 9 H h h h h h h h h h h h h 2 Alliance Trust PLC

7IM Sustainable Balance 8 H h h h h h h h h h h h h H 2 7 Investment Management

ConBrio B.E.S.T. Income 7 H h h h h h h h h h h h h h h 1 Elcot Capital

Henderson Global Care Growth 7 H h h h h h h h h h h h h h h H 2 Henderson Group PLC

Jupiter Ecology Inc 6.5 H h h h h h h h h h h h h H 0.5 Jupiter Asset Management

AXA Ethical Distribution 6 h h h h h h h h h h h h h h H H 1 AXA Group

Royal London Sustainable World 6 H h h h h h h h h h h h h h h H 1 Royal London

Sarasin EquiSar Socially Resp. 6 H h h h h h h h h h h h h h h H 1 Bank J Safra Sarasin

Old Mutual Ethical 5.5 H h h h h h h h h h h h h h H H 1 Old Mutual

Quilter Cheviot Climate Assets 4.5 H h h h h h h h h h h h h h H H Old Mutual

F&C Responsible Global Equity 4 h h H H H h h h H h h h h h h H 0.5 Bank of Montreal

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USING THE TABLESPositive ratings (+ve):

• Company Ethos:

e = full mark,

E = half mark.

• Product Sustainability: Maximum of five positive marks.

See all the research behind these ratings together on www.ethicalconsumer.org. Free to subscribers.

USING THE TABLESEthiscore: the higher the score, the better the company across the criticism categories.

H = worst rating

h = middle rating empty = best rating (no criticisms found)

FP WHEB Sustainability is our overall Best Buy. It invests specifically in

environmental technologies such as renewable energy,

and we could find very few investments worthy of criticism.

Alliance Trust Sustainable Future European Growth is our best buy out of the fully carbon divested funds. It discloses its full list of investments, and the company avoided being marked down for many of the things which afflicted the others.

Some information on how these funds have been doing financially is available on page 32.

Many individuals choose to invest in ethical funds via an independent financial advisor (IFA). Our guide to ethical IFAs appears on our website.

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WHEB Asset Management Business Development Role

02 March 2016

Pioneering sustainable investment firm seeks dynamic, dedicated business development manager.

WHEB Asset Management WHEB Asset Management LLP (‘WHEB’) is a pioneer in sustainability investing. Founded in 2009, WHEB is an independent owner-managed partnership based in London but investing globally. WHEB’s investment philosophy is that superior returns can be achieved by investing in solutions to the pressing sustainability challenges the world currently faces. In addition, these superior returns are best achieved by investing for the long term in companies that successfully manage their environmental and social footprint, and have good governance. For more information about WHEB Asset Management and the WHEB Group see www.whebgroup.com.

Business Development Role WHEB is seeking a full-time Business Development Manager, based in London, who will join the team with responsibility for WHEB’s client relationships and business development in the UK intermediary market. WHEB has a team of eight people focused on a single investment strategy built around sustainability themes, with a long-only, global, listed equity investment vehicle, the FP WHEB Sustainability Fund. The investment strategy employs a fundamental and long term approach based on a deep understanding of the companies and industries the Fund invests in. Key responsibilities will include: - Growing WHEB’s coverage and relationships in the UK Wealth Manager, IFA, platform and

wholesale markets; - Attending and leading client presentations and meetings; - Preparation of marketing materials and financial promotions, including presentations, articles

and other communications; - Developing a detailed understanding of WHEB’s investment process and knowledge of

current investment activity in order to keep clients informed.

14.59

– using their shareholder power to pressurise companies to improve.

As carbon divestment is a campaign for divestment, not shareholder activism, we decided that this was no longer so appropriate. We have therefore stopped ignoring ‘activist’ companies’ investments. However, as we wanted to continue to reward best practice in shareholder activism, we gave the three strong performers in this area – Jupiter, WHEB and F&C – a half mark in the ‘Product Sustainability’ category.

Our full system of extra marks is as follows:

A Company Ethos mark if all of a company’s funds are ethical (SRI – ‘Socially Responsible Investing’) funds.A full Product Sustainability mark if the fund is fully carbon divested, receiving all 5 ‘badges’ on FossilFreeFunds.org.A full Product Sustainability mark if the fund discloses its full list of investments.A half Product Sustainability mark if the company was named by ShareAction as a top ‘shareholder activist’.

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Fund% growth

over 5 years to June 2016

Royal London Sustainable World 61.4

Henderson Global Care Growth 45.4

F&C Responsible Global Equity 44.6

Impax Environmental Markets 43

Old Mutual Ethical 38.4

ConBrio B.E.S.T. Income 36.9

AXA Ethical Distribution 36.4

Quilter Cheviot Climate Assets Fund 35.03

Alliance Trust Sustainable Future European Growth 34.7

Jupiter Ecology Inc. 26.1

7IM Sustainable Balance 25.3

FP WHEB Sustainability 10.7

Sarasin EquiSar Socially Responsible N/A

IA Global (for comparison) 34.3

N/A = New fund – insufficient data available

Fund financial performance (ranked by growth)

The companies behind the brandsWHEB is a small specialist environmental investor that describes itself as “focused on the opportunities created by the global transition to more sustainable, resource-efficient and energy-efficient economies.”

WHEB’s investment policy mentions social as well as environmental issues, but it does not formally screen its investments on animal welfare or human rights issues. However, the company discloses all of its investments and we couldn’t find anything that made us want to mark it down in these categories.

Impax is another specialist environmental investment company. Impax Environmental Markets Investment Trust was the first UK listed equity fund to demonstrate a net positive carbon impact.5

Impax lost some marks as its Food and Agriculture Fund has investments in Unilever and Bunge, which have collected criticisms for many things including their use of animal products and the poor conditions in their supply chains.

Impax is also 25% owned by BNP Paribas, the third largest bank in the world. BNP Paribas invests in nuclear weapons, as well as many other unpalatable sectors. In 2015 it was fined $8.9 billion in the US after it was convicted of violating US sanctions.6

Alliance Trust does reasonably well in our ratings. It does not appear to engage in tax avoidance, and it does not invest in nuclear weapons. However, it is a member of the World Business Council for Sustainable Development, a free-trade lobby group, and its executive director earned £1,435,000 in 2015.

Quilter Cheviot was bought by Old Mutual in 2015. It did less well in our ratings as Old Mutual has a lot of investments in unwholesome sectors including nuclear weapons,7 is a member of a large number of free-trade lobby groups8 and has many high-risk subsidiaries in tax havens.9

Sarasin and Partners’ website strapline is “specialising in global thematic investment funds, based onshore and offshore”. It received our worst rating for likely use of tax avoidance strategies and it is owned by J Safra Sarasin, a Swiss bank. It does not disclose what its executives get paid.

Funds which published their full list of investments were: ConBrio B.E.S.T Income, Henderson Global Care Growth, Alliance Trust Sustainable Future European, 7IM Sustainable Balance, FP WHEB Sustainability, Impax Environmental Markets and AXA Ethical Distribution.

All of the funds we have looked at are ethical funds, and all are either completely or almost completely carbon divested. They are all, therefore, a good bet. The ones at the top of the table are just the crème de la crème.

Anti-social financeOnly four companies avoided being marked down for likely use of tax avoidance strategies: WHEB, Impax, Alliance Trust and Elcot. Two companies received our middle ranking on this: Royal London and Bank of Montreal. All the others received the worst.

All the companies apart from WHEB, Impax and J Safra Sarasin were also marked down in the Anti-Social Finance category for paying obscene sums of money to their senior staff. However, while WHEB and Impax do pay less, Sarasin got off on this score just because we could not obtain the information. Being a Swiss bank, it is not obliged to disclose its directors’ pay.

References: 1 ERIS, 2016, www.eiris.org 2 Scott, 2015, Why are investors shunning ethical funds? Money Marketing, https://www.moneymarketing.co.uk/why-are-investors-shunning-ethical-funds 3 Eg.Rob Bauer, Kees Koedijk & Roger Otten, 2002, International Evidence On Ethical Mutual Fund Performance And Investment Style, Financial Economics 4 Patrick Collinson, The Guardian 10 April 2015 http://www.theguardian.com/environment/2015/apr/10/fossil-fuel-free-funds-out-performed-conventional-ones-analysis-shows 5 Castlefield, 2015, Winners and Spinners 6 Reuters, 1/5/2015 BNP Paribas sentenced in $8.9 billion accord over sanctions violations 7 ICAN, 2015, Don’t Bank on the Bomb 8 Eg. The World Business Council for Sustainable Development 9 Hoovers.com

Four funds only invest in environmental technologies and renewable energy: FP WHEB Sustainability, Impax Environmental Markets, Quilter Cheviot Climate Assets and Jupiter Ecology.

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The last ten years has seen a spectacular growth of community renewables projects in the UK. These had in part been boosted by government incentives such as tax advantages for investors (EIS) and guaranteed returns for investors though the Feed-in Tariff scheme for electricity generators.

To the dismay of campaigners, and in an astonishing display of short-sightedness, most of these incentives were removed or severely curtailed by the new Conservative government at the end of 2015. Although, at the time of writing, there were still many projects seeking investments which were set up before these changes were introduced, most people predict a reduction in such schemes in the medium term.

Indeed, one of the renewable energy funding websites we mentioned in our last banking report in 2014, Trillion Fund, announced in September last year: “Recent changes in government policy have rocked investor confidence and made the landscape for future renewable energy projects very uncertain. As a result we have decided that, with regret, we will not be able to offer any new renewable energy loans for the foreseeable future.”

Nevertheless, there will continue to be investors and projects driven by a desire to work on mitigating climate change and, as there were before the incentives were introduced, innovators and great projects will still be available.

Projects are only usually seeking funding for short periods of around three to four months, and there are commonly at least a dozen projects seeking funding at any one time. Because of this, we have not listed individual projects here, but instead have listed five of the main ‘overview’ schemes which can help UK investors find and fund community renewable projects directly with their own money.

Direct investments in renewablesFor people moving money out of carbon for ethical reasons, the most positive impact on climate change can probably be had by investing this money directly into community renewables projects.

Five key playersETHEX, the positive investments website, is going from strength to strength. It collates and lists most of the best positive investment opportunities that come up in the UK. In May 2015, for example, it listed nine renewables projects of which seven were solar arrays and two were hydro schemes. Although it covers more than renewables and looks at savings as well as investments, renewables have been where the bulk of its work has been to date.

One of its great virtues is that that it provides a ‘health check’ of projects before they appear on the site – thus removing extremely risky ones from the mix. Minimum investment is £1-£2000 depending on which project you invest in, and you can pay online. 01865 403 304 www.ethex.org.uk

Abundance Investment specialises in UK-based renewable energy projects and was the first crowd-funding platform to be regulated by the FCA. Individuals are able to deposit money online and then invest in specific projects according to their preferences. Abundance has recently launched the ability to hold Abundance investments in a Self-Invested Personal Pension (SIPP) and investors can apparently view how much electricity their projects are generating, depending on how windy or sunny it is. Investors from anywhere in Europe can invest in Abundance projects, and you can invest as little as £5 and can complete all transactions online. 020 3475 8666 www.abundancegeneration.com

Energy4All is a not-for-profit social enterprise dedicated to expanding the number of renewable

energy co-operatives within the UK. It is different from the other schemes, in that it is owned by the co-operatives it assists and is a vehicle for them to offer mutual support to each other. It lists current share offers on its website for ethical investors. 01229 821 028 www.energy4all.co.uk

Sharenergy is a not-for-profit organisation that helps communities find, build and own renewable energy generation throughout the UK. The website also advertises share offerings for community renewable energy schemes. 01743 277 119 www.sharenergy.coop

Repowering London helps develop community (solar) energy projects in London, periodically listing on its website those that are seeking funding from ethical investors. 07960 829 826 www.repowering.org.uk

Getting financial adviceWhilst direct investments may have the strongest ethical credentials, they do carry with them the risk of losing your money if the project fails. They are therefore generally for people who already have a safety net of savings in place.

We often quote the Consumers’ Association’s advice at this stage. Before investing they suggest:

Paying off debt first; Getting life and sickness insurance; Sorting out a retirement plan or pension; Having at least three months’ salary as savings in cash for emergencies.

If investing large sums, it may be worth contacting an ethical Independent Financial Advisor (see our guide on the website at: www.ethicalconsumer.org/ethicalreports/ethical-finance/ifas)

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Save our Bank: successes, failures and the future...

Three years ago The Co-operative Group was forced to make an ‘historic compromise’ with private capital to prevent the collapse of its banking arm. The stakes were high: failure of the bank would probably have meant the end of The Co-operative Group itself – the oldest and most iconic co-operative in the world. A rescue was arranged without state intervention (in contrast to the rescue of Lloyds and RBS in 2008), but at a price.

Late in 2013, a deal was struck with people who had lent the bank money, including several US hedge funds, giving them a 70% share of the bank. The Co-operative Group remained the largest shareholder. But it had lost overall control.

For many customers the first instinct was to leave for Nationwide or one of the other mutuals. With US hedge funds in control, what chance that the bank would maintain its world-leading ethical policies and brave campaigning.

Save Our BankThe Save Our Bank campaign started with the belief that something good could be saved if the customers who cared about ethics were organised – because without customers any bank is worthless – something a hedge fund understands. Over 10,000 supporters signed up to an on-line campaign calling on the bank to maintain its ethical policy and for an eventual return to co-operative control. For many loyal customers, Save Our Bank offered a way to make their feelings known without leaving – a point not lost on the bank.

The first challenge for the campaign came when the new management said it would survey customers about a renewed ethical policy. Surveys can be manipulated and this could be used as an excuse to water the ethical policy down, for example by downplaying ‘political’ concerns like human rights in favour of promises to ‘treat customers fairly’. Ahead of the survey, Save Our Bank supporters put huge pressure on the bank by writing, emailing and tweeting. Eventually the CEO of the bank stated publicly that no existing commitments would be dropped.

The bank asked Save Our Bank for advice on the content of the survey.

The new policy was finally announced in January 2015 after more than 70,000 customers had taken part. The bank kept its promise – a close reading showed that on all but a couple of minor issues, the existing policy was unmolested. Plus there were significant new commitments. Critical but positive engagement with the bank had paid off.

Executive pay still an issuePerhaps unsurprisingly, there was less success when Save Our Bank called on the chief executive to take a stand on spiralling executive pay by foregoing his bonus. The bank says that Niall Booker is a turnaround specialist paid to do a particular job and has hinted that his successor will be paid less. We shall see. The bank’s position was thrown into sharp contrast when Richard Pennycook, CEO of The Co-operative Group ‘demanded’ recently that his salary be cut by 60%.

But there were other signs that positive engagement with the bank could produce results. Save Our Bank had called on the bank to “return to campaigning”, and the bank used these very words when it launched a joint campaign with Refuge on financial abuse in intimate relationships. The bank is also providing a generous £1million to fund an innovative co-operative support programme led by Co-operatives UK.

The customer unionThe Save Our Bank campaign proved that organised customer pressure can produce results. As the campaign progressed, the question became how to sustain it. And what could customers do to help bring the bank back under co-operative control?

Save Our Bank decided to create a ‘customer union’ – so far as we know this has never been tried before. Members are asked to pay a small subscription to fund the union, which keeps an eye on the bank.

A crowdfunding campaign to set up the customer union raised more than twice

Late in 2013, a group of Co-operative Bank customers – with the backing of Ethical Consumer – started the Save Our Bank campaign. Shaun Fensom looks back at the campaign as it begins a new era as the Customer Union for Ethical Banking.

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the target of £15,000. By the time you read this the Customer Union for Ethical Banking (CUEB) will be in business and new members will be able to sign up online and join the 1,500 who have already paid their first year’s subscription of £12. CUEB is a legally-constituted co-operative and everybody gets one vote.

A new type of co-operativeThe union is formed as a co-operative with the potential to crowd-fund the purchase of shares, creating a new, independent co-operative stake. Of course, even with the current low valuation of the bank’s shares, rebuilding a co-operative controlling interest is a massive undertaking.

However, with just a small stake the customer union would be able to collaborate with other investors. What’s more, member control is at least as important in the co-operative movement as member ownership, and arguably Save Our Bank supporters have already had more influence over the bank than co-op members had when the bank was still 100% owned by The Co-operative Group.

Lastly, many small contributions make a big one: this is how the co-operative movement was built and much bigger co-operative banks like Credit Agricole in France turn to their customers for large amounts of capital.

Error of judgement over PalestineEven as the crowdfunding was underway, a new issue arose that caused many who had stayed loyal to the bank to question whether the ethical policy was just a facade.

Without any explanation (beyond an occasional reference to ‘risk appetite’) the bank closed the accounts of around 40 support and campaigning groups, mainly working in Palestine. These included the Palestine Solidarity Campaign, and also the Cuba Solidarity Campaign and the Nicaragua Solidarity Campaign. It is difficult to think of an action more likely to raise suspicions that the bank was coming under political pressure from its new shareholders.

When challenged however, the bank was adamant that the decision was purely operational and taken to reduce the risk of a penalty from regulators for not ensuring that money transferred to ‘high risk areas’

does not end up funding illegal activities.This left some unanswered questions,

not least why the groups affected had not been asked in any detail about their work (some say they never transfer money abroad). It seems that the commercial calculation was that it was cheaper to close accounts than carry out this detailed work. The furore generated came at the very time the bank was launching its initiatives on financial abuse and co-operative support. The closures were paused pending a review of communications.

Recently however, groups working on Nicaragua have been asked to complete long forms about their activities under threat of having their accounts closed (one has simply been told its account will be closed). This is bad news. But if you accept – as we do – that all the banks are coming under massive pressure from regulators and governments, and that the Co-op, with 40,000 charity accounts is facing a much greater burden than other banks, then the forms are a step forward. The bank is at least looking at each case rather than simply closing the accounts.

We also welcome the policy agreed at the Amnesty International UK AGM to pressure the Co-op Bank to take careful account of the impact on the work of human rights organisations, but also to press government on this issue.

And here in the end is the core of the argument. When it was told to close its account, the Palestine Solidarity Campaign

called on its supporters to leave the Co-op. But what’s the alternative? Which are the consumer banks that have a real ethical policy and which help human rights organisations carry out their work?

Still worth savingThe Co-op Bank has its faults and is certainly making mistakes, but for most banking customers it is arguably better than any of the alternatives. The bank is striking a balance between commercial pressures and the need to support its ethical brand. If an organised group of customers can shift that balance, that surely is worthwhile. If it ever comes to a point where the bank is no longer worth saving, the customer union can take the decision to leave, but democratically and together, not in ones and twos.

There is, however, a much more positive argument for sticking with the bank and joining the customer union. The Internet and social media give consumers new power. A customer union can organise and focus that power. Working with employee unions and like-minded investors, and soon with a shareholding of its own, there could even come a time when such stakeholders become the dominant voice. A time when the bank is run in the interests of its customers, employees and the wider community.

In fact, just what you would want from a co-operative bank.

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ProductGUIDE

The introduction of the government’s flagship auto enrolment policy in the UK has brought over six million new people into a pension scheme, with more than 100,000 businesses setting up a workplace scheme.1 It is a policy that has helped reverse a decade-long decline in the nation’s general level of retirement funding.2

Simply put, auto enrolment (AE) is a legal requirement for all UK employers to establish a pension scheme for staff members and opt them in on an automatic basis, and is a landmark policy that companies should ensure they make the most of.

For companies with a strong corporate social responsibility reputation, the policy also creates a new question: as a responsible business, are you also ensuring that your pension scheme is a responsible investor?

Sustainable options are availableThe bulk of UK pensions are made up of a range of investment funds, which are typically structured as Open-Ended Investment Companies (OEICs). These allow individuals to pool their money with others to hold shares in a wide range of companies.

This is a huge part of the UK’s investment market place and, as a consequence, there are many hundreds of these investment funds. Under auto enrolment rules an employer must select a default fund which meets criteria laid down by the Department for Work and Pensions (DWP), and offer a choice of alternative funds too – though in practice few individuals take an interest in selecting their own funds meaning most UK workers are invested into default pension funds within their AE scheme.

The problem, however, is that the standard default options being offered by

Pensions: the new frontier for responsible companiesJohn Ditchfield, one of the UK’s leading advisers on environmental investment funds, discusses sustainable solutions for your auto enrolment pensions.

many insurance and investment groups are often not sufficiently transparent, and will not typically include a policy on responsible and ethical investing, let alone any recognition of carbon divestment.

This is of course a very serious issue for companies, charities or NGOs with a strong corporate responsibility ethos. It is one of the most common issues that employers have raised with my firm, Castlefield, over the past few years.

Fossil free pensions?At Castlefield we work a lot with the Alliance Trust Sustainable Futures Funds which offer a range of nine investment strategies that take sustainability trends into account in their investment methodology.

For example, the funds exclude ‘carbon-intensive’ industries and tobacco companies because they do not make a measurable contribution to a sustainable future. These funds, instead, positively invest in businesses seeking to profit from the massive expansion occurring in the renewable energy markets (both solar and wind energy) as well as into other important investment themes such as energy efficiency and clean/low emissions transport.

In fact, Alliance Trust Investments plan to divest entirely from oil and gas extractives by the end of 2016 on the basis that current global CO

2 emissions

levels place the world at very grave risk of average global temperature increases exceeding 1.5°C.

We have worked with WWF and Greenpeace to set up largely fossil-free AE schemes for their staff, based on the Alliance Trust funds. This can also work for smaller companies. We have recently been setting up something similar with a four-person PR agency.

The Alliance Trust funds also show that sustainability does not mean sacrificing returns. Seven out of eight of their funds

are in the first or second quartile of their sectors over one, three and five years.3

The world is also changing. Last year’s Paris Agreement for example has put the world on a clear trajectory towards a low-carbon economy. Investors increasingly acknowledge that those companies that manage environmental, social and governance issues in a responsible manner are more likely to succeed over time, and there is an increasingly strong business case for pension schemes to invest in sustainable funds.

An issue of trustFor employers, providing at least an option of a responsible or ethical pension is becoming an extension of good CSR practice.

Most employees trust their employers to look out for their best interests and, just as they would expect high standards of support and training in their role, they would also expect that their pension savings are not invested in sectors that might go against the core values of the company.

Employers have a crucial role to play and it’s vital that they choose their schemes carefully.

To discuss sustainable solutions for your pension and investments please see www.castlefield.com or email: john.ditchfield@castlefield.com

This is not an offer or a solicitation to make an investment. It does not constitute a personal recommendation and recipients must satisfy themselves that any investment is appropriate in the light of their own understanding, appraisal of risk and reward, objectives, experience and financial and operational resources. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Non independent research is not subject under the Markets in Financial Instruments Directive (“MiFID”) to any prohibition on dealing ahead of the dissemination of investment research.

Compliance code: MEPENJD/130516

References: 1 www.cityam.com/236235/uk-pensions-six-million-people-have-been-auto-enrolled-into-a-workplace-pension-since-the-rules-were-introduced-in-2012 2 https://www.gov.uk/government/news/millions-more-saving-thanks-to-automatic-enrolment 3 www.alliancetrustinvestments.com/global/documents/6076/78340/80256/Sustainable-Future-Insights-February-2016

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Fossil-free financeJULY/AUGUST 2016 ethicalconsumer.org

ProductGUIDE

New regulations in the UK mean that all employers not already providing pensions will need to put their staff into a pension scheme and contribute towards it. This is called auto enrolment, and by 2018 an estimated nine million workers – mainly within small- to medium-sized businesses – will be saving into such pension schemes.

Life insurance companies and pension funds are one of the largest investor groups in the UK, with a staggering £3 trillion in assets under management according to the Bank of England. The nine providers covered in this survey represent a huge portion of this sector as they have over £1.9 trillion in total assets under management.

The Organisation for Economic Co-operation and Development (OECD) estimates that UK pension funds invest 27.7% of their assets abroad, meaning their investment behaviour has global consequences. As large shareholders, these pension providers have significant power to influence the behaviour of companies in the UK and across the globe. This is ShareAction’s first survey of auto enrolment providers and it looked at ethical performance across eleven areas to reach its score:

GovernanceTransparency and accountabilityClimate changeHuman rightsLabour rightsNatureRemunerationTaxes and corruptionExtractive industriesPower generationArms

The survey found that communications and accountability to members still fall way short of what is needed to overcome the public’s widespread lack of trust and understanding of the pension sector, and to ensure their valid ethical concerns are

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Auto enrolment pensions

reflected in investment policy and practice. None of the providers include information about Responsible Investment issues in the annual statement sent to members. Only one provider surveys the members of its auto enrolment default fund about Responsible Investment.

Only Standard Life names all the companies they engage with, alongside a summary of the topics they engage with companies on. Only NEST publishes a list of their largest investment holdings.

Climate changeInstitutional investors have a vital role to play in ensuring global warming remains below the 2˚C target agreed by global leaders in Paris.

All the providers except for The People’s Pension mention climate change in their investment policies, but there is much room for improvement on this issue.

Only Aviva has committed to measure and disclose the greenhouse gas emissions of its entire investment portfolio.

Only Aviva, Aegon and Legal & General state that they invest in companies or projects that support the transition to a low-carbon economy and emissions reduction in the economy as a whole.

Only Aviva, Standard Life and Scottish Widows assess the risks of ‘stranded assets’

with respect to fossil fuel companies’ project portfolios.1

However, as six of the providers have recently signed the Paris Pledge for Action, committing them to support implementation of the Paris agreement, it is hoped that rapid improvements will be seen.

More information and links

This article was compiled using data from ShareAction’s report ‘Reclaiming Ownership: A survey of governance and responsible investment at UK automatic-enrolment pension providers’.The full report is downloadable from the ShareAction website and there is also a web tool that enables savers to explore and compare the performance of the pension provider which manages their savings.shareaction.orgYou can also find more in our guide to pensions available at ethicalconsumer.org/buyersguides/money/ethicalpensionsFinding carbon-divested auto enrolment pensions can be quite difficult. This subject is covered in more detail in the article opposite.

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Footnote: 1 The stranded assets concept, developed by Carbon Tracker, posits that in order to limit global warming to 2˚C above pre-industrial levels (the target agreed by global leaders in the 2010 Cancun agreement), 80% of known fossil fuel reserves must remain in the ground. This means that 60-80% of the oil, coal and gas reserves of listed firms are unburnable under a 2˚C scenario and could become worthless, stranded assets.

Pension providerScore

(out of 80)

1 Aviva 39

2 Standard Life (Contract-based schemes) 37

3 Standard Life (Master trust) 36

4 Aegon 32

5 NEST 27

6 Legal & General (Contract-based schemes) 23

6 Legal & General (Master trust) 23

8 NOW: Pensions 17

9 Royal London 16

10 Scottish Widows 13

11 The People’s Pension 4

In February 2016, ShareAction published an ethical ranking of the biggest providers of ‘auto enrolment’ pensions in the UK. This is an extract from that report.

A SURVEY OF GOVERNANCE AND RESPONSIBLE INVESTMENT

AT UK AUTOMATIC-ENROLMENT PENSION PROVIDERS

RECLAIMING OWNERSHIP

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Climate of changeJULY/AUGUST 2016 ethicalconsumer.org

Breaking free from fossil fuelsMay kick-started a year of escalated direct action against the fossil fuel industry, with thousands of people resisting fossil fuel projects over six continents between 3-16th May.

To keep global warming below 2°C, at least 80% of global fossil fuel reserves need to stay in the ground. As governments and corporations aren’t reacting fast enough, individuals are increasingly taking matters into their own hands. Highlights from the ‘Breaking free from fossil fuels’ fortnight include:

The UK’s largest open cast coal mine, Fyos-y-Fran near Merthyr Tydfil in South Wales, was shut down for a day on May 3rd by the UK’s climate action network, Reclaim the Power. The action was taken in solidarity with the local community who have been battling against the mine, owned by Miller Argent, for nearly a decade, and now face the threat of a new mine next door.

Welzow-Süd, Europe’s largest lignite mine located in Lusatia, East Germany, was blockaded by over 3500 activists as part of a mass civil trespass organised by Ende Gelände (translates as ‘here and no further’). The action shut down operations at the lignite mine and its coal loading station for 48 hours, and cut the power plant off from all coal supplies. The power plant, owned by the Swedish energy company Vattenfall, was reported to have had its capacity reduced by 80%.

Activists blocked, via land and water, the largest coal port in the world in Newcastle, Australia. This action was reported to have resulted in AU$20 million worth of coal shipments being halted.

On the 14th May, over 500 people marched along a highway in Pecém, North-East Brazil, blocking traffic from delivering coal to one of Brazil’s largest thermal coal plants. The march was said to include a wide variety of people, including individuals from “20 municipalities, four Indigenous ethnic groups (Anacé, Pitaguary, Tapeba and Tremembé), fishermen and residents of the coastal zone, farmers and residents of the inner cities severely affected by drought”.

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1. In Nigeria, protests moved between areas that have been devastated by the oil industry, with demonstrations commencing at Oloibiri, the site of Nigeria’s first oil well.

2. Ende Gelände action, East Germany.

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Climate of changeethicalconsumer.org JULY/AUGUST 2016

A range of actions took place across the United States including hundreds of protesters blocking train tracks in Albany NY to stop oil-filled ‘bomb trains’ from travelling through communities. In Colorado campaigners disrupted an auction selling public lands for fossil fuel extraction.

To read about the many other actions that took place in Turkey, Nigeria, South Africa, Canada, the Philippines... visit breakfree2016.org

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References: 1 www.theguardian.com/environment/2016/apr/17/rbs-pulls-fossil-fuel-investments-green-energy 2 www.theguardian.com/environment/2015/mar/03/bank-of-england-warns-of-financial-risk-from-fossil-fuel-investments

BP’s corrupting cultural sponsorshipCampaign group Art Not Oil has released a report that challenges Bob Dudley’s (BP’s CEO) assurance that the company “supports the best of British arts and culture with no strings attached”. As the British Museum and National Portrait Gallery are both currently considering whether to renew their sponsorship deals with BP, the report raises timely ethical questions.

The ‘BP’s cultural sponsorship: A corrupting influence’ report draws on numerous emails and documents released under the Freedom of Information act, highlighting BP’s influence over British cultural institutions including the British Museum, National Portrait Gallery, Tate and Science Museum. Evidence highlighted includes: BP hosting meetings for cultural institutions’ security staff to co-ordinate the management of anti-BP protests; BP funding a festival of Mexican culture in order to gain access to Mexico’s ambassador in the run-up to oil lease auctions; the company using its sponsorship relationships to lobby the Culture Minister; and BP getting final approval on curatorial decisions in the British Museum’s Indigenous Australia exhibition.

The report accuses the named cultural institutions of compromising on their values and independence in order to meet BP’s demands, stating that they lack transparency, have undermined public trust and have breached ethical codes. In light of the above, the report will be formally submitted to the Museums Association to investigate whether its official Code of Ethics for Museums has been breached.

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3. 800+ people surrounded the Kinder Morgan oil facility on the Satish Coast, Canada.

4. Ffos-y-Fran, the UK’s largest open-cast coal mine, was shut down for over 12 hours

5 & 6 Whilst Kayactivists blocked the water off Newcastle’s coal port, Australia, 60 activists blocked the rail tracks preventing coal from reaching the port for over six hours.

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Tax Justiceethicalconsumer.org JULY/AUGUST 2016

Anti-corruption summitMeanwhile in London, the much-touted Anti-Corruption Summit took place on 12 May, which was attended, in the Prime Minister’s own words, by some “fantastically corrupt countries”, including the UK. The summit had been billed as a major event “aimed at stepping up global action to expose, punish and drive out corruption in all walks of life”2 but turned out to be somewhat of a damp squib.3

Representatives of tax havens would have found it useful that the summit focused solely on crime and not on the systemic issues that allow corruption to flourish and that undermine global trade and trust. Transparency was discussed but many tax havens said they would only exchange information with tax authorities and law enforcement agencies. This would mean that any claims made by tax havens will continue to be unverifiable by the general public.

On the whole, very little happened.

Certain measures that had already been announced were re-announced, such as the intention to share beneficial ownership data (excluding Guernsey and the British Virgin Islands). Although nothing was said about how the UK would verify the data it received. It was also re-announced that the UK would require declarations of the beneficial ownership of companies owning property in the UK, but again omitted details about how this would be enforced.

Another positive point was that the rules on disclosure will be extended to public sector contractors. This means that the whole process of awarding public sector contracts – from the bidding right through to the building – will be visible to the public for the first time.4 But tax expert and campaigner Richard Murphy believes that limiting this disclosure to contracts over £10 million, as set out in the Government’s paper on beneficial ownership transparency,5 is too high a bar, as it would only

cover the big four (Atos, G4S, Serco and Capita) and major infrastructure projects, and would exclude many smaller public sector contracts.

The summit also shone a spotlight on the role of the US as a secrecy jurisdiction, as leaders from the Isle of Man and the Cayman Islands accused the US of ‘hypocrisy’ for criticising tax havens while maintaining low-regulation states of its own, such as Delaware and Wyoming.6 Of course, the UK’s position as a prime enabler of corrupt money flows was also centre-stage after the Panama Papers in April revealed that many of the 200,000 shell companies included in the leak were located in British overseas territories and crown dependencies. The British Virgin Islands alone held around 100,000 companies.7

“If there is progress then it is not because of what was announced, but the opportunities that the Summit provided to highlight issues”, said Richard Murphy. “What you can be sure of is that this issue is not going away.”

References: 1 www.oxfamamerica.org/static/media/files/Broken_at_the_Top_FINAL_EMBARGOED_4.12.2016.pdf 2 https://www.gov.uk/government/news/anti-corruption-summit-aims-to-secure-global-commitment-against-corruption 3 www.taxresearch.org.uk/Blog/2016/05/13/the-anti-corruption-summit-a-post-mortem/#sthash.2gJVtD0X.dpuf 4 https://www.gov.uk/government/news/government-contracts-to-be-open-to-public-for-the-first-time 5 https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/512333/bis-16-161-beneficial-ownership-transparency.pdf 6 Financial Times, ‘Offshore centres hit at US financial transparency “hypocrisy”’, 12 May 2016 www.ft.com/cms/s/0/39a8a40c-1859-11e6-bb7d-ee563a5a1cc1.html#ixzz49fYBsqgI 7 www.theguardian.com/news/2016/apr/03/what-you-need-to-know-about-the-panama-papers

Oxfam, Action Aid, and Christian Aid set up a temporary ‘tax haven’ in Trafalgar Square on the day of the summit to protest against the lack of transparency in Britain’s offshore territories.

CitigroupAccording to a recent report by Oxfam America, US bank Citigroup had an effective tax rate of -91.7% between 2008 and 2014. They managed this by taking $2.6 trillion in federal loans, bailouts, loan guarantees and tax breaks even while the company made $9.3 billion in profits and squirrelled away nearly $44 billion offshore.

Citigroup appears in our guides to Current Accounts and Savings Accounts on page 10 as the Citibank brand.

The report, ‘Broken at the Top’, looked at how America’s tax system enables large-scale corporate tax dodging, not just in the United States but in developing countries as well, fuelling “dangerous and growing levels of inequality” globally.1 In its criticism, Oxfam America took aim at the way in which large companies use offshore tax havens and other aggressive and secretive methods to artificially reduce their corporation tax rates in both the United States and developing countries, while at the same time being the largest beneficiaries of taxpayer-funded support.

The report looked at the fifty largest US companies in the Forbes 2000 annual ranking to find out taxes paid, taxes avoided, federal support received and lobbying expenditures between 2008 and 2014. It found that:

For every $1 paid in federal taxes, these companies received $27 in federal loans, loan guarantees and bailouts.

For every $1 spent on lobbying, these companies received $130 in tax breaks and more than $4,000 in federal loans, loan guarantees and bailouts.

Their effective tax rate was 26.5%, despite making $4 trillion in global profits.

Only five companies paid the full 35% US corporate tax rate.

Collectively these companies had 1,600 disclosed subsidiaries in tax havens, which were used to conceal $1.4 trillion.

Thousands of additional subsidiaries in tax havens may remain undisclosed due to weak reporting requirements by the Securities and Exchange Commission.

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ClothesJULY/AUGUST 2016 ethicalconsumer.org

The need for a fashion revolutionIn April, Ethical Consumer partnered with Fashion Revolution to publish the first edition of the Fashion Transparency Index.

The Index rated 40 of the biggest global fashion brands and companies according to the level of transparency in their supply chain.

Its release marked the three-year anniversary of the Rana Plaza garment factory collapse in Bangladesh where 1,134 people were killed.

The factories operating in that building made clothes for over a dozen well-known international fashion brands, many of which are covered in the Transparency Index. After the disaster, it took weeks for some companies to determine whether they had relationships with those factories, despite their clothing labels being found in the rubble.

Carry Somers, Co-Founder of Fashion Revolution said: “Lack of transparency costs lives. It is impossible for companies to make sure human rights are respected, and that environmental practices are sound without knowing where their products are made, who is making them and under what conditions. When companies are working in a transparent way, this also implies

openness, communication and accountability across the supply chain and with the public”.

The Transparency Index found that the vast majority of companies really need to be doing a lot more work around transparency – none of the companies scored full marks.

Levi Strauss & Co, H&M, Inditex (Zara, Pull & Bear, Bershka, etc.) came top of the table and were the most transparent global fashion companies compared to the rest of the brands surveyed.

The average score for the 40 brands we surveyed was 42%, with Levi Strauss & Co getting the highest score with 77%. Chanel, meanwhile, came bottom with just 10%, closely followed by Forever 21, Claire’s Accessories, Hermes, Louis Vuitton and Prada, sending a strong signal that luxury brands in particular have much more work to do.

Of the forty brands, only 10 responded and we commend these brands for engaging with the process but were disappointed that more companies were unwilling to engage. This seemed symptomatic of the problems in the industry.

Those that didn’t respond were rated based on the information publicly available on their websites.

For more information, to download the report and to contact the companies that score worst in the Index, go to www.ethicalconsumer.org/ethicalcampaigns/fashionrevolution

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Thousands of garment workers rally at the one-year anniversary of Rana Plaza.

Rana Plaza, Three Years OnThulsi Narayanasamy, Senior International Programmes Officer (Sweatshops and Plantations) at War on Want, tells us if there has been any progress.

Three years after the devastating collapse of Rana Plaza in Bangladesh, the factory owner is in prison, compensation to victims and families has been paid but global garment brands continue to profit from exploitation of workers in Bangladesh.

The Bangladesh Accord, a legally binding five-year agreement to improve conditions in the country’s garment industry, was set up in the immediate aftermath of Rana Plaza.

This February, another fire broke out in a garment factory in Bangladesh. Had the fire broken out an hour later, 6000 workers would have been crammed into the building making clothes for the UK high street. The factory had been inspected by the Bangladesh Accord years earlier, but changes had not been made. Whether the thousands of factory inspections will lead to safer workplaces remains to be seen.

But The Bangladesh Safety Accord marked the first step towards holding garment companies to account for the working conditions in their supply chains, and now it is no longer contested that the brands are responsible for the human rights abuses that workers faced.

Perhaps the biggest change since the factory collapse, has been in the awareness of garment workers themselves. The unprecedented international attention on working conditions brought about by the Rana Plaza collapse flicked a switched in the minds of many workers, previously resigned to the grim reality of life working in a sweatshop. The shift among workers was such that many workers now refer to working life as ‘before Rana Plaza, and after Rana Plaza.’

Voluntary regulation has failed; voluntary standards have enabled brands to present themselves as ethical without having

to change a thing about how they operate. National regulation, alongside legally binding international mechanisms, is long overdue.

The opportunity exists in the form of a UN treaty that is currently being negotiated, to form a set of laws to hold corporations to account at an international level for their impact on human rights.

This could mean that no matter where the clothes are being made, workers will be guaranteed a living wage, safe working conditions, regular working hours and the right to join a union.

The UK Government must support the international process to hold corporations to account for human rights abuses. If it doesn’t, we will have once again failed the people who make our clothes.

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Clothesethicalconsumer.org JULY/AUGUST 2016

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Cruelty exposed: live goose feathers ripped out on down farmsA new PETA exposé of goose farms in China, the source of 80% of the world’s down, shows that workers pin live geese down and rip their feathers out. Many endure this torture multiple times before finally being slaughtered. All the farms featured in the exposé have connections to suppliers that are certified by the Responsible Down Standard (RDS) – raising concerns over the legitimacy of the RDS certification.

PETA is calling on retailers to stop selling down products and instead only sell down-free products thereby assuring 100% cruelty-free garments.

“There’s simply no guarantee that the feathers inside any jacket or pillow weren’t ripped out of a screaming goose’s skin”, says PETA Managing Director Ingrid Newkirk. “PETA is calling on kind retailers and consumers to ditch down in favour of high-tech synthetics that are compassionate, warm and hypoallergenic – and even insulate when wet.”

A representative from Jilin City Bailing Down Products, which receives live plucked feathers from a co-operative featured in the exposé, admitted, “The plucking is done in secret; we’re unwilling to pluck openly”, and, “[W]e advertised

that it’s all plucked after slaughter – nobody dares to buy it if you say it’s live-plucked”. Bailing sells down to the RDS-certified Down Decor, a supplier to outdoor retailer Lands’ End.

You can send an email to Lands’ End telling them to ‘ditch down’ from Peta’s website, where you can also view the video footage – www.peta.org.uk/action

In our guide to Insulated & Waterproof Jackets in EC158, Jan/Feb 2016, Best Buy Paramo had a policy of only using synthetic fillings.

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Geese huddle together after their feathers have been ripped out.

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Trump boycotts Amazon!Our Amazon boycott campaign may have found an alarming bed-fellow in US presidential candidate Donald Trump.

At the start of May the controversial Republican nominee told Fox News “Amazon is getting away with murder tax-wise.” He added that Amazon founder Jeff Bezos was using the Washington Post, which Bezos acquired in 2014, “for power so that the politicians in Washington don’t tax Amazon like they should be taxed.”

Bezos later responded at an event held by the Washington Post by saying that he is “very, very comfortable with all of Amazon’s approaches and behaviours. The way we pay taxes, the political positions we take, are focused on our business and very appropriate.”

The war of words started after it emerged that the Washington Post had assembled a 20-person team to investigate Donald Trump and his business practices.

“We need institutions that have the resources and the training and the skill, expertise, to find things,” Bezos said when the news emerged. “It’s pretty important who we elect as President, all those things, and we need to examine those people, try to understand them better.”

At the end of May, and with very little sense of the irony of its own position, the Post ran a story showing that last time Trump made his accounts public they showed he paid $0 in federal taxes.2

The paper stated that “The disclosure, in a 1981 report by New Jersey gambling regulators, revealed that Trump had for at least two years in the late 1970s taken advantage of a tax-code provision popular with developers that allowed him to report negative income.”

The Post reports that Trump’s personal taxes “are a mystery.” He has not released any recent returns, making it impossible to scrutinise what he pays and he would be the first major-party nominee in 40 years to not release his returns. Perhaps then he won’t be joining our boycott campaign just yet.

Illegal pond weed for sale on Amazon According to a report in the Guardian in May, Amazon were listing a banned invasive water plant species for sale on its market place, through a third party seller. The paper reported that until May Amazon sellers were advertising ‘Parrots Feather’ for sale to UK consumers.

The aquatic weed was banned by the UK government as “they have destructively colonised rivers and waterways.”

Andrew Wiseman, one of the UK’s leading environmental lawyers, told the Guardian that, in his opinion, Amazon had broken the law by hosting advertisements on their British websites. One seller was based in Latvia and importing the pond weed into the UK while a second was sold from a warehouse in the UK (although at the time of the original report this was out of stock. After being made aware of the potential legal breach, Amazon removed both of their listings for parrots feather.

Amazon excludes minorities and then backtracksIn May Amazon was forced to extend a free shipping offer after it was reported that the company had excluded minority neighbourhoods in several US cities from its Prime Free Same-Day Delivery service while extending the service to white neighbourhoods.

An analysis by Bloomberg News in April highlighted apparent racial disparities in areas where the service was available in Atlanta, Boston, Chicago, Dallas, New York and Washington, where black residents were less likely than white residents to have access to the service.1

Amazon made a pledge to extend its offer of free delivery in all areas of the 27 cities where the offer was in place after a group of black politicians threatened to launch a federal investigation into the matter.

According to Bloomberg, the Congressional Black Caucus, an organization which represents black members of Congress, had alerted Amazon that it was monitoring the situation and supported calls for an investigation by the Federal Trade Commission into the service boundaries.

“Very shortly, we will be expanding Prime Same Day Service to every zip code of the 27 cities where Prime Same Day delivery is currently launched,” Amazon said in the statement obtained by the caucus and shared with Bloomberg News. “We will not launch the service in any new regions until we are able to secure a carrier for every zip code.”

Amazon started its free same-day service last year as a perk of Amazon Prime membership. Service boundaries were determined by the concentration of Prime members in each area, proximity to warehouses where goods are stored and the company’s ability to find delivery partners to serve an area, according to Amazon, with race playing no role.

Amazon boycottJULY/AUGUST 2016 ethicalconsumer.org

References: 1 www.bloomberg.com/graphics/2016-amazon-same-day 2 https://www.washingtonpost.com/politics/trumps-income-tax-returns-once-became-public-they-showed-he-didnt-pay-a-cent/2016/05/20/ffa2f63c-1b7c-11e6-b6e0-c53b7ef63b45_story.html

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Boycottsethicalconsumer.org JULY/AUGUST 2016

EU Ministers support right to boycott IsraelThe Netherlands has become the second state in the European Union (EU) to publicly state that calls for a boycott of Israel should be protected according to the principle of freedom of expression.

The Dutch Minister of Foreign Affairs, Bert Koenders, stated that, “Statements or meetings concerning BDS [Boycotts Divestment and Sanctions] are protected by freedom of expression and freedom of assembly, as enshrined in the Dutch Constitution and the European Convention on Human Rights.”

Revealing that Israel regularly raises the topic of BDS in bilateral meetings with the Dutch government, Koenders reiterated his government’s opposition to the boycott of Israel but insisted that “endorsing BDS falls under freedom of expression.”

In March, the Swedish foreign ministry reaffirmed basic democratic principles by stating that BDS “is a civil society movement” and that “governments should not interfere in civil society organization views.”

Irish foreign minister Charles Flanagan also added his voice to the debate saying that while BDS is not supported by the Irish government it is “a legitimate political viewpoint”.

The ministers in all three countries responded after the UK and various US legislators attempted to criminalise or block the boycotting of Israel using new legislation.

Counter-boycotts in the USANew Jersey’s state legislators passed a bill that would see public worker pension funds divested from companies that boycott Israeli goods and businesses.

Similar counter-boycott laws have been proposed in New York, Illinois and Florida, where state Governor Rick Scott

in March signed a ban on doing business with companies boycotting Israel.

BDS campaigners have commented, “US law makers pushing this McCarthyite, anti-democratic and unconstitutional legislation are out of touch with shifting opinion.”

In response to increasing hostility to the BDS movement from both the Israeli government and their allies, including the US and UK governments, the Palestinian BDS National Committee appealed to the UN High Commissioner for Human Rights over the de-legitimisation of boycotts.

In the space of 11 days, 23,000 people signed the appeal to the UN which requested that the UN “ensure that individuals, groups, associations, public and private institutions and local governments participating in the Boycott Divestment and Sanctions (BDS) movement can freely express their opinion and act for Palestinian human rights without unlawful interference or repression.”

The petition was also a response to an effective travel ban on BDS movement co-founder Omar Barghouti.

New campaign guide releasedA new toolkit has been released by UK activists to help individuals campaign more effectively for the rights of Palestinians.

The toolkit contains ‘how to’ guides and sets out the basics for each kind of campaign activity, including fact sheets about key aspects of the case for justice in Palestine.

The writers believe that “the key to shifting British foreign policy on Palestine is to continue informing public opinion about Israel’s settler colonial project in Palestine and to develop individual personal relationships with people, making us better placed to influence. “

The toolkit was released by EuroPal Forum, an independent organisation advocating Palestinian rights and working to achieve a positive and accurate public opinion on Palestine.

They writers say that they “adapted the contents from a similar toolkit for pro-Israel supporters who seek to justify the occupation of Palestine, maintaining the violent and unjust status quo.”

You can download the toolkit from http://bit.ly/bdstoolkit

G4S leaves IsraelIn March, G4S revoked its contracts with Israel following a campaign asking the United Nations to drop its contracts with the firm unless it chose to leave.

Israel’s Public Security and Strategic Affairs Minister Gilad Erdan admitted at Sunday’s Jerusalem Post Conference in New York that G4S, the world’s largest security company, stopped doing business in Israel because it caved in to the Boycott, Divestment and Sanctions movement.

Erdan appeared to threaten G4S saying, “BDS was a factor in the decision of security company G4S to sell their operations in Israel. The company is now trying to convince everyone that BDS was not a factor. Don’t listen to them. Giving in to BDS was a mistake, both morally and financially. Companies that take such politically- motivated decisions must pay a price, and they will.”

Erdan’s office is responsible for dealing with both the BDS campaign and terrorism, which he describes as “two sides of the same coin.”

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TTIPJULY/AUGUST 2016 ethicalconsumer.org

Although it is not stopped, the Transatlantic Trade and Investment Partnership (TTIP) EU-US deal is looking pretty shaky. But the Comprehensive Economic and Trade Agreement (CETA) between the EU and Canada is on the verge of being ratified, and also allows corporations to sue governments, just like TTIP.

Obama tries to push TTIP in Europe

Tens of thousands of people protested in Germany during US President Obama’s visit in April. The visit was primarily aimed at giving TTIP a boost, to try to see it finalised before he leaves office. However, a YouGov poll found that public support for the deal in Germany had dropped from 55% to 17% over the last two years. US public support had fallen a similar amount, from 53% to 18%.1

In Britain, more than 150,000 people signed a 38 Degrees petition asking Obama to stop the negotiations.

Leaked TTIP documents reveal high industry input

Greenpeace Netherlands have leaked nearly 250 pages of TTIP negotiation documents which you can access via the website www.ttip-leaks.org. The director of Greenpeace EU, Jorgo Riss, said: “These leaked documents give us an unparalleled look at the scope of US demands to lower or circumvent EU protections for environment and public health as part of TTIP. The EU position is very bad, and the US position is terrible ... The way is being cleared for a race to the bottom in environmental, consumer protection and public health standards.”2

The four most serious concerns according to Greenpeace are:

Long-standing environmental protections appear to be dropped – no mention was found of the 70-year old WTO rule that allows nations to regulate trade “to protect human, animal and plant life or health”.

Climate protection will be harder under TTIP – there was no mention of the need to keep global temperature rise under 1.5°C.

The end of the precautionary principle – this EU approach is not mentioned, instead, the US ‘risk-based’ approach is mentioned several times.

Opening the door for corporate takeover – participation is proposed for corporations at the earliest stages of policy making.3

France threatens to block deal

France’s lead trade negotiator Matthias Fekl has said he thinks TTIP talks will be halted. The French media’s negative reporting on TTIP has soared in recent weeks, echoing the popular mood and leading the French president, on the day after the TTIP leaks, to say he could not accept “the undermining of the essential principles of our agriculture, our culture, of mutual access to public markets.”4

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What about CETA?

CETA negotiations started before TTIP but are even less well known, although the European petition with more than 3 million signatures is about stopping both deals. CETA also includes the ‘Investor State Dispute Settlement’ (ISDS) allowing corporations to sue governments.

Similar agreements already exist which show the kind of thing CETA would encourage. One example is a lawsuit taken to the World Bank’s International Centre for the Settlement of

Investment Disputes (ICSID) by Swedish energy company Vattenfall against Germany, for introducing environmental requirements around the impact on water quality in the River Elbe of a proposed coal-fired power station.6 Another is a Canadian gas and oil company, Lone Pine, suing against a fracking moratorium in the province of Quebec. Although TTIP and CETA are widely called ‘trade deals’, intellectual Noam Chomsky recently said in a Channel 4 News interview that TTIP could more accurately be called an Investors’ Rights Agreement.5

As Global Justice Now say, “CETA is effectively a backdoor to TTIP, with any US corporation operating in Canada able to exploit its provisions to sue EU governments should they take decisions that may impact on expected profit margins.”

The final text of CETA was signed in 2014, but it has not yet been ‘ratified’ by the EU Parliament. CETA is due to be discussed by the EU Council in June, when ‘provisional implementation’ could be agreed. “This would allow the European Commission to bring trade deals into effect before national parliaments have had the chance to debate – and reject – an international treaty ... In other words, a corporate case could be brought against the British government before Parliament has ratified CETA.”4

The good news is the Dutch parliament have voted for a non-binding motion to reject this provisional implementation, and the Netherlands might hold a referendum on CETA too. Global Justice Now are asking people in the UK to sign a petition calling on David Cameron to veto the provisional implementation of the deal. Add your name at tinyurl.com/zdqgufd

TTIP on the ropes – CETA in the wings

References: 1 www.independent.co.uk/news/world/europe/thousands-protest-against-trans-atlantic-trade-and-investment-in-germany-ahead-of-obama-visit-a6998201.html 2 www.theguardian.com/business/2016/may/01/leaked-ttip-documents-cast-doubt-on-eu-us-trade-deal 3 www.opendemocracy.net/can-europe-make-it/thomas-fazi/ttip-we-were-right-all-along 4 www.globaljustice.org.uk/blog/2016/may/4/ttips-looking-lot-less-likely-were-still-not-safe-toxic-trade-deals 5 www.youtube.com/watch?v=P2lsEVlqts0 6 www.iisd.org/pdf/2009/background_vattenfall_vs_germany.pdf

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48

LettersJULY/AUGUST 2016 ethicalconsumer.org

£4.25EC

160 May/June 2016

ww

w.ethicalconsum

er.org

This little piggydidn’t goto marketWe name the most ethical

veggie bangers & burgers

Product guides to:Cooking oil, Meat-free burgers & sausages, Rice

Plus: Supermarkets update & Veg box schemes

Optics for hunting have their placeI would just like to point out that in New Zealand we have enormous problems with introduced animals. There are various control strategies employed to protect our native flora and fauna from predation from the exotics. These strategies generally all involve killing the targeted animal.

Often the most humane means of control is by shooting, where recreational hunting can provide useful assistance to state-funded culling of animals.

I like to think of myself as a greenie at heart. In the last few years I have been getting into hunting as I have seen the damage done by large herbivores in our delicate alpine ecosystems. I see no problem in going on an alpine trip and coming back with a load of meat which is well enjoyed by our family and those that it is given away to.

Good optics are very useful for accurately ranging and dispatching an animal in a quick and humane manner.

In the New Zealand context there is even room for trophy hunting, although I personally can’t bring myself to shoot something purely because it is big and beautiful.

I understand that New Zealand is possibly a small and isolated exception to the worldwide hunting industry. However, I have seen our possum fur and skin industry suffer considerable decline partly by environmentalists attacking those wearing furs. Possums cause massive damage across NZ. Having a commercial imperative to control them was helping to reduce the damage.

I haven’t read your full report, but I just wanted to voice concern that even for nature lovers, it can be difficult to find black and whites out there...

Rory Jones, by email

Alternative to rice adviceAs you noted in EC160, those who are worried about the environmental impact of eating rice should consider barley. I can add that it can be cooked in the same way, is often superior in taste, and is widely grown in the UK.

Dave Jackson, by email

Wi-fi – Why not?In response to Guy Wood’s letter about wi-fi exposure (EC160) and there not being “more concern”, the reason is simple: there doesn’t appear to be any reason to be concerned.

Wi-fi is non-ionizing radiation which puts it into the same category as radio waves (>50 years’ exposure to the entire western world through TV Radio) and ultrasound (which is of course what they point at babies in wombs). This doesn’t guarantee it’s harmless, but it’s in a different league to the bad stuff that comes to mind when most people think of ‘radiation’ – the harmful ionizing radiations such as x-rays, and ultraviolet.

Guy doesn’t specify the studies he’s referring to and I cannot readily find them, except the male infertility one which was probably poor experimental design. I have found a study showing no effects on pregnancy outcomes excepting stress related ones (they’re worried about the wi-fi), and another showing no effect on the immune system of babies.

On the issue of the WHO classification as a “potential (2B) carcinogen”, I would point to this article which clearly states the classification is for the entire EM spectrum. This was “based on studies of extremely heavy cell phone use; 1640 hours or more per year, which is equal to holding a cell phone to the side of your head for 4 hours a day every day of an entire year.” and as a result of that extremely high usage, there was ‘possibly’ an increase in a rare type of brain tumour. It should be noted that “WiFi emits 1% of the levels of EMF radiation as cell phones do”.

So, while “Wi-Fi” is new, the western world has been zapping themselves with EM in the form

of radiowaves and ultrasound for decades with negligible effect.

I also found multiple papers which do show a correlation between bad media reporting and people then experiencing symptoms and “developing an apparent sensitivity to” whatever the ailment of the week is. I would therefore suggest maybe we should focus on weeding out bad media reporting as it has a more deleterious consequence to society than wi-fi.

Jon Jones, by email

When service sucks!We recently purchased a vacuum cleaner (Hoover). It was obviously good for the environment (so we thought) with its A rating. On opening the box, we found a vital part was missing. It was not easy to obtain this part and, because of this, they offered us a cleaner/descaler for our washing machine(!) in compensation. I said ‘no’, because I had seen one several years ago and turned it down because of environmental concerns. They (Hoover Candy) gave us to understand that this product was environmentally sound.

Imagine our dismay when, on reading the (very) small print, we saw that this product is dangerous to aquatic life with a long-lasting effect. I wrote a letter of complaint and they quietly put a refund into our bank account (no letter, though). I only wish I had the energy to start a campaign around this issue. Any offers?

E. Wood

Visual distortionThanks for the latest update; your veggie vs meat page is very interesting (EC160 p11). However, I find your infographic desperately confusing. It looks as if you’re trying to convey land use with rectangular patches for each food type. However, they just don’t make sense:

At first I thought that the patches were overlapping (smaller patch contained in larger, etc.), but that doesn’t make sense because at 3m² each, Quorn and soya should occupy the same patch.

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Lettersethicalconsumer.org JULY/AUGUST 2016

mono-cultures, GM contamination, poor contracts with multinational corporations, and over-use of herbicides. Whilst these are good examples of how crops have been controlled and used in a poor and ill-thought-through manner, none of these issues show that there is anything bad with GM crops themselves. I think by all means environmental charities could do good by campaigning against intensive farming, corporate power and the over use of herbicides, but why should this be twisted into an all-out ‘GM Freeze’? Surely it is possible to support sensible use of GM without considering it to be a replacement for good practise and farm management?

Perhaps EC could consider more carefully the other potentially ethical effects of GM, and fully inform readers, before seeing it swiftly dismissed in the opening lines of an article?!

Zoe Round, by email

Ed: We recognise that GM is an issue that divides our readers which is why a column on the tables allows them to avoid or support companies involved. A key concern at EC is Monsanto’s dominance in this area and its focus on commercial profit.

We welcome readers’ letters. Letters may be edited for reasons of space or clarity. If you do not want letters to be published, please mark them ‘Not for publication’. Our address is on the contents page, or email us at letters@ethicalconsumer.org

But if the patches aren’t overlapping, then things don’t make sense because chickens should use up more than twice the area of the Quorn/soya, which they don’t, and pigs are even more bewildering because they don’t use twice as much again as chickens.

And what are you using to convey area? The grey patches? The coloured ones? Colour kind of almost makes sense except that the sizes still don’t work and it would imply that the containment/overlap hypothesis is correct, which it plainly isn’t, and why is the grey there anyway and what do the variations in grey area mean, and why is the text for soya possibly on Quorn’s patch, etc. Sigh.

.. and I’m a mathematician, so I usually do quite well at making sense of these things. Please could you try again? It’s a great idea to try to present this kind of information in a nice intuitive way, but I think this graphic could do with a bit of a review...

To my mind, if the total area of the graphic represents the 420m² required for a kilo of beef, then soya and quorn should each have plots that are a twelfth the size of this on each edge, representing their 3m², since 420 = 140 times 3 is approximately 12 by 12 times the area required by soya/quorn: if you stack 12 rows of 12 columns of little 3m² patches you’ll get one 432m² patch, which is close enough. Similarly chicken should be about a seventh on each side (7*7*8m² = 392m²), and pork a little over a fifth on each side

(5*5*15m² = 375m²). As far as I can see, this picture would look quite a bit more dramatic than your current graphic since the Quorn and soya patches are absolutely *tiny* compared to beef. That’s just not obvious (to me at least) from the current graphic.

As I reach the end of this I’ve a new hypothesis, that it’s the width of the coloured stripes and the cow field that you’re trying to use (the dark green cow area is 375 pixels wide, the pig stripe 12 pixels, chicken 8, quorn 4, soya 5), but I’m not convinced that the representation makes sense: we don’t think of area as the width of a stripe, we think of it as rectangles.

Conrad Hughes, by email

Ed: You are not the only person to have been confused by this infographic. We accept that it could have been clearer.

It is your last hypothesis, the width of the coloured strips, that we were trying to use. Apologies for any confusion.

GM feedback

I have enjoyed reading Ethical Consumer for the past 18 months, but I now find myself querying one particular issue. From articles I have read, it seems that a lot of people would see genetically modified crops as harmful to a green/ethical lifestyle. I have always felt slightly dubious about this stance.

An article in EC160 titled ‘GM is not the answer’ talked about

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Inside ViewJULY/AUGUST 2016 ethicalconsumer.org

It was a decision that UK climate change campaigners could scarcely believe.

Just days after agreeing to move swiftly to a low-carbon energy future at the climate change conference in Paris last year, the UK government announced that it was going to slash subsidies to householders installing rooftop solar panels by a whopping 65%.

Thanks to the help of these subsidies, the growth of solar power has been one of the standout success stories for the UK’s renewable energy sector. However, campaigners feared that the government’s unprecedented attack on the solar industry would stop this growth in its tracks.

So what’s been the impact of the cutting of these subsidies?

Well, as widely expected, the news isn’t good.

Figures released in April showed that the amount of household solar power capacity installed in the previous two months plummeted by 75%, much to the dismay of campaigners such as Richard Dyer, renewable energy campaigner at Friends Of the Earth.

“The Government’s bizarre attacks on renewable energy have hit the sector hard and fly in the face of the Paris commitment to limit the rise in the global temperature to below 2 degrees,” says Dyer.

Despite this, he remains defiantly upbeat about solar’s future:

“There is an unstoppable global momentum for renewable energy and the solar revolution is going to happen regardless of what is just a temporary blip here in the UK.”

The solar industry itself is similarly confident that solar has a sun-filled future and refuses to accept that the cut in subsidies signals the end of the industry.

“There has been a drop-off in the installation of solar panels on homes, but once the market settles down after the hugely disruptive effect of the cuts of 2015,

we’re relatively optimistic that the market will pick up again,” says Sonya Dunlop from the Solar Trade Association.

“Under the right circumstances it’s still possible to get relatively good financial returns on your solar panels, for example if you have a south-facing roof,” says Dunlop.

“And for anyone who is replacing their roof, it’s a no-brainer to be replacing with solar,” adds Dunlop pointing out that a significant part of the installation costs for solar panels is the scaffolding.

This confidence in solar’s future received a welcome boost this April with the news that alongside its tea-lights and Swedish meatballs, Ikea is to start selling solar panels in a bid to move solar into the mainstream.

“Despite the challenging UK renewable energy policy situation, we want to turn solar into an essential part of any home and believe our new ‘Solar Shops’ will be a major milestone in making this happen,” says Joanna Yarrow, Ikea’s UK sustainability boss.

By teaming up with Solar Century, one of the UK’s pioneering solar power companies who will install the panels, the flat-pack specialists wants to roll out solar power across the country.

“At Ikea we believe that renewable energy is undoubtedly the power of the future,” says Yarrow.

Solar still shining

© S

olar

Cen

tury

There’s a sunlit future for household solar panels.

“We know our customers want to live more sustainably, so together with Solar Century we are making solar panels as attractive and affordable as possible.”

And the future for solar looks even more promising thanks to the launch earlier this year of the Powerwall, the latest piece of cutting-edge technology unveiled by the founder of the revolutionary Tesla electric car, Elon Musk.

Despite the plummeting cost of solar power systems, solar’s major limitation is simply that it doesn’t work when the sun isn’t shining.

In effect a giant battery which sits on the wall in your home, the Powerwall is designed to provide this ‘missing link’ and store surplus solar energy not used at the time it’s generated and then use this energy later on when the sun isn’t shining.

It’s the Powerwall’s potential as a possible solution to the problem of solar generated electricity that’s now causing such a buzz around the world and here in the UK.

“Domestic storage alongside solar could be a cornerstone of our smart energy future, enabling us to get the most out of clean, home-grown energy,” says David Pickup, business analyst at the Solar Trade Association.

“We’re starting to see products such as the Powerwall being installed in the UK and it’s a fantastic sign of things to come.”

The future for domestic solar power looks bright despite recent government attacks, says Simon Birch.

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