Sustainable Investing: Aligning Your Values and Your Money

Sustainable Investing: Aligning Your Values and Your Money

Environmental responsibility can go beyond the choices made at home. You may already recycle, drive an electric car, avoid unnecessary plastics, bicycle or walk when possible, and make thoughtful purchasing decisions that support both personal and planetary health.

But healthcare professionals and clinic leaders often overlook another important opportunity: where their money is invested. Many retirement accounts, institutional funds, and personal investments are supporting investment sectors that conflict with our personal values, such as fossil fuel companies closely tied to pollution and climate change. Increasingly, investors are examining whether their financial choices or those made by their financial advisors align with the healthier future they want to help create.

Environmental responsibility can extend beyond daily habits and into the financial decisions that shape society’s future. For more than a decade, many investors are choosing to divest from fossil fuels and explore more environmentally sustainable investment options.

The Waning of Fossil Fuels
The fossil fuels sector, while occasionally a top performer, has experienced long periods of underperformance. Its volatility has been on full display over the past year, but it was also the most volatile of any S&P sector over the previous decade (2015-2024). Geopolitics are a key driver of the fossil fuel sector’s unpredictability and are likely to continue to be so. For investors looking to minimize sudden or dramatic fluctuations, it makes sense to avoid the fossil fuel industry.

Numerous years of evidence indicate that this strategy may be particularly beneficial for long-term investors who are planning for their futures. Of course, markets and sectors can be unpredictable, and past performance does not guarantee future results. But as world economies and consumers gradually and inexorably shift in this century from a dependence upon fossil fuels towards energy efficiency, renewable energy, and energy storage, it makes sense for long term investors to move their money away from the old paradigm.

Fossil Fuel Underperform
The Institute for Energy Economics and Energy reported that during this same period since 2015, the “fossil fuel sector has underperformed the S&P 500 in seven of the last 10 years, delivering the lowest performance of any S&P sector” and stated that “oil, gas, and coal have often been unreliable and inconsistent contributors to long-term investment portfolios.”

Investing Without Fossil Fuels
A fossil fuel free portfolio typically holds 0% in the Energy Sector, thereby avoiding companies involved in the exploration, production, transmission or management of coal, oil and gas, as well as companies that service these industries. Clean and renewable energy companies are not in this sector. Instead, they are categorized in several other sectors, including utilities, industrials, and technology. A clean technology company, for example, might even be listed in the manufacturing sector. A decision to abandon the fossil fuels sector is often accompanied by a decision to direct a portion of one’s portfolio towards the clean energy sector, which might include a range of industries such as solar, wind, and  geothermal energy development or generation, electric vehicles, electricity transmission, sustainable agriculture and construction, recycling companies, and many more options.

Fossil Fuel Free Investing Today
Green investing is no longer a fringe movement. There are hundreds of options such as individual stocks, private equity firms, mutual funds, and exchange traded funds (ETFs). For busy health professional, a wise choice is to find a financial advisor or fund manager with deep experience.  Green Century¹ has been a champion of fossil fuel free investing for decades, offering individuals and institutions a way to invest without supporting the world’s most environmentally harmful industries.

If your funds already are professionally managed, ask that advisor to tell you whether your money is supporting the fossil fuel industry. Coal, oil and gas companies — key drivers of air pollution, water contamination, and climate change — top the list of corporations damaging our health and environment. With your simple instructions, your advisor will responsibly shift your assets to be aligned with your values and your long-term financial goals.

Contact the Green Century team at info@greencentury.com.

About the Author: Leslie Samuelrich is President of Green Century, a pioneering investment firm focused on environmentally responsible investing with more than $1.3 billion in managed assets. With nearly 40 years of experience spanning corporate engagement, environmental leadership, and public health initiatives, she is a leading voice in sustainable finance and shareholder advocacy.

Notes:
This material is for informational and educational purposes and is intended for a U.S. audience. It should not be considered investment advice, nor is it a solicitation to buy or sell any specific investment or strategy. No guarantees are made regarding the accuracy or completeness of the information provided. 
 
Green Century is a trade name for Green Century Capital Management, Inc., an SEC-registered investment adviser. Some products are distributed by Distribution Services, LLC, an unaffiliated broker-dealer. Green Century Funds are available only through a prospectus and to U.S. residents.

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