Cash advice

Coronavirus has made consumers a lot more ethical, on everything from how they shop, what they drive to how they bank. But while around two-thirds of consumers, according to Tandem Bank research, say they would switch banks if they were more environmentally friendly, 55 per cent admitted they weren’t sure how to be green with their money. Here’s what you need to know… 1 EVERYDAY BANKING

Do you know what your bank does with your cash? The chances are you don’t, yet every time you put money in, your bank or building society may be lending it to companies in the tobacco or arms industry. Find out more about your bank’s values at yourethicalmoney.org. Not happy? Then it’s time to switch.

2 HOW DO I BANK IN A GREEN OR ETHICAL WAY?

If you want to ensure your money is being lent to organisations that support renewable energy, healthcare or education, for example, then take a look at Triodos Bank for current accounts.

Co-op Bank has also restated its commitment to ethical banking under new leadership in recent years. Digital-only bank Starling also has a strong ethical policy, which includes a commitment not to do business with companies that promote harmful behaviour – such as arms manufacturers and tobacco companies.

3 GREEN NS&I BONDS

In the Budget this year, the chancellor Rishi Sunak, announced the launch of a Green Sovereign Bond, which will allow you to save money in a sustainable way and support green projects. The bonds will be provided by NS&I later this year.

4 ETHICAL INVESTING

Often known as socially responsible investing (SRI), it means your money will be used to help support businesses that are looking to make a positive change in society or to the environment, while at the same time considering financial return. Most providers offer ethical investment ISAs. A number of investment companies now offer ethical funds, and the good news is, the returns are also strong too – the average UK ethical fund has outperformed the average non-ethical fund, and the FTSE All- Share, according to AJ Bell. To get an idea of ethical fund options, take a look at Interactive Investor’s Ace 40 list, for example.

5 RETIRE ETHICALLY

Your pension fund has the power to hold companies to account on things like pay and human rights, encourage diversity, or promote green energy through their governance structure – so demand that your money is invested to drive the issues that matter to you and at the same time, help your pension pot flourish. Ask your fund provider about ethical options.