By: Ed Thomas, Co-Founder and CEO of 412 Technology
If one of your new year’s resolutions is to help fight climate change, where should you begin?
First, you can—and should—lobby all levels of our government for science-backed climate policy, and you should demand that the corporations you buy from become better stewards of our common resources.
But what should you do personally? Personal behavioral changes—such as biking more instead of driving, or eating less meat—can have a huge impact on climate change. But as anyone who’s tried dieting knows, behavioral changes are hard to do and harder to sustain.
Fortunately for us, there are at least three simple actions anyone can do to fight climate change:
Invest In an ESG Portfolio
If you have a stock portfolio, you should consider adding an ESG requirement. ESG (environmental, social & governance) investing, also known as ‘sustainable investing’, seeks to invest in companies that take the impact of their business into account in addition to the return they provide investors.
Getting started in ESG investing can be as simple as investing in ESG index funds instead of their non-ESG equivalents, opting for an ESG mix at with your existing roboadvisor, using an ESG-specific roboadvisor or picking a financial advisor who specializes in ESG investments. However you go about it, your investments will be increasing the value of companies that are socially responsible, enabling them to access capital more easily and expand their impact.
This in turn encourages more companies to become responsible, helping mobilize additional capital to fighting climate change. If you’re interested in investing directly into companies at the forefront of the climate fight, resources exist to identify them too.
Invest In Climate Change Projects
If you’re ready to take the next step and invest directly in climate-change related projects, consider investing in the green bond market.
Expected to balloon to over $500B in 2021, the green bond market is a catch-all phrase for any public debt that’s been issued to support environmentally sustainable projects. From solar plants in Europe to energy retrofits of corporate campuses to the electrification of city vehicle fleets, almost every form of climate change project a company or municipal government could take exists for you to invest in.
The easiest way to get started in this market is to invest in green bonds through exchange traded funds that track this sector. This gives you access to a portfolio of different projects and a management team that knows how to identify the best investments. If you’re interested in investing in bond issuances directly, a financial advisor is the best starting point.
Purchase Carbon Offsets
If you want the biggest climate impact for your dollar, however, there’s a third option available: Simply pay a project sponsor to remove carbon from the atmosphere.
Known as carbon offsetting, the concept is very simple: Buyers pay a project sponsor to take an action that removes a verified amount of carbon from the atmosphere, thus directly fighting climate change. Whether your interest is in planting new forests, enabling sustainable farming, conserving critical rainforest or supporting technical solutions, there are a myriad of projects available that have a carbon impact that you can support. As a bonus, many are sponsored by non-profits.
Want to neutralize your impact on the climate? Purchase enough in reduction from the offset market to equal the amount of carbon you generate. Want to go one step further and be part of the solution? Purchase more in offsets than you personally generate in carbon emissions, and you’re actively helping reverse climate change!
Multiple new platforms and services exist—including Arbor, my company’s platform—to make the carbon offset market simpler and easier for everyday consumers to navigate and use. Dollar for dollar, it’s the simplest way to maximize your climate impact.
We’re at an inflection point in the fight against climate change, and our choices over the next few years are likely to determine whether or not we have a recognizable world in the coming decades. Make 2021 the year when you join the solution by taking a few simple steps to help reverse climate change.
Ed Thomas is the co-founder and CEO of 412 Technology, a public benefits corporation focused on reversing climate change. Arbor, the company’s flagship product, enables users to fight climate change by eliminating the climate impact of specific actions through the carbon offset market. Learn more about Arbor and sign up for early access by visiting their website.