Financial Planning Fossil Free Fuel Investing

This article was written by Leslie Samuelrich, Green Century’s President.

In 2012, colleges, churches and cities started divesting their holdings from the fossil fuel industry. Since then, individual investors and financial advisors have joined this movement and have taken their own and clients’ money out of coal, oil, and gas companies. Many investors have looked to Green Century for guidance and options, since it has nearly a decade of experience with fossil fuel free investing.

The top four reasons to consider fossil fuel free investing are:

1. Align Your Investments with Your Values
Climate change is a serious threat to our society, and burning fossil fuels is a main cause of worsening floods, droughts, and wildfires. For ethical and moral reasons, many investors don’t want to invest in the industry that is principally responsible for causing a changing climate — and avoiding coal, oil, and gas companies may be the right decision for you too.

2. Reduce Corporate Influence on Necessary Energy Policy
Fossil fuel companies have tremendous influence over legislation and regulations. They have used it to block sensible solutions to climate change and to slow development of cleaner energy sources. Inspired by the successful South African divestment campaign, the fossil fuel free investment movement exposes and chips away at the industry’s power to thwart progress.

3. May Reduce Exposure to Devalued or Stranded Carbon Assets
The fossil fuel industry now controls reserves of coal, oil, and gas that — if extracted and burned — will release five times more carbon dioxide than scientists agree is safe.¹ If governments restrict carbon emissions, companies with those fossil fuel reserves may not be able to sell them, and they may become devalued assets or stranded assets, impacting stock prices.

4. Reinvest in Clean Solutions
Divesting now not only could allow investors to reduce their exposure to a “carbon bubble,” but also frees up funds to invest in companies building a clean and sustainable economy. Investors can move their money into mutual funds that hold companies focused on renewable energy, energy efficiency, and water conservation — companies like Johnson Controls*, which retrofits commercial office buildings with hybrid solar cells that collect 75% of solar energy to cool and power the building.

Green Century fulfills its 3-part mission of green investing by offering direct investments in sustainable and low carbon companies, through advocating for sensible corporate and policy solutions, and through supporting non-profit environmental groups.

As the first family of responsible, diversified fossil fuel free mutual funds, Green Century offers two funds:
1. The Green Century Equity Fund invests in the longest running socially responsible stock index, minus the fossil fuel companies in that index.
2. The Green Century Balanced Fund invests in the stocks of environmentally responsible companies and green bonds.

In addition, Green Century leverages its clout as a shareholder to press top U.S. companies to reduce their carbon emissions by making their supply chain more sustainable. For example, in 2014, Green Century persuaded Kellogg’s*, ConAgra*, and JM Smucker* to reduce carbon pollution — the companies agreed to stop buying palm oil that was grown on plantations created by burning rainforests, a leading cause of global climate change.

And finally, Green Century Capital Management offers a unique ownership structure that supports non-profit environmental groups.  As the only mutual fund company founded and owned by environmental advocacy organizations, the net profits Green Century earns on the management of the Green Century Funds belong to its founders, the Public Interest Research Groups (PIRGs), which are part of the Public Interest Network that also includes Environmental Action and Environment America.

This year, Environment America and its allies submitted more than 4 million public comments to the Environmental Protection Agency (the EPA), and garnered support from more than 600 local elected officials and hundreds of small business owners in support of the EPA proposed Clean Power Plan that will finally limit carbon pollution from power plants.

Rob Thomas is a member of the DailyWorth Connect program. Read more about the program here.

¹ Vladimir Stenek, “Carbon Bubbles & Stranded Assets,” The World Bank, June 3, 2014.

* As of September 30, 2014, Johnson Controls, Inc., The Kellogg Company, and The JM Smucker Company comprised 1.92% and .0.43%; 0.00% and 0.25%; and 1.12% and 0.15% of the Green Century Balanced Fund and the Green Century Equity Fund, respectively. Other securities mentioned were not held in the portfolios as of September 30, 2014. References to specific securities, which will change due to ongoing management of the Funds, should not be construed as a recommendation by the Funds, their administrator, or their distributor.

Stocks will fluctuate in response to factors that may affect a single company, industry, sector, or the market as a whole and may perform worse than the market. Bonds are subject to risks including interest rate, credit, and inflation. The Funds’ environmental criteria limit the investments available to the Funds compared to mutual funds that do not use environmental criteria.

This information has been prepared from sources believed to be reliable. The views expressed are as of the date of this writing and are those of the Advisor to the Funds.

You should carefully consider the Funds’ investment objectives, risks, charges and expenses before investing. To obtain a Prospectus that contains this and other information about the Funds, please visit for more information, email [email protected] or call 1-800-93-GREEN. Please read the Prospectus carefully before investing.

The Green Century Funds are distributed by UMB Distribution Services, LLC. 10/14