Blue Mountains council has increased its investment in environmentally sustainable funds.
A report handed to last month’s council meeting showed greater reliance on ethical products, including $2 million invested with ME Bank, a so-called “green bank” which avoids investing in industries that negatively affect the environment.
The change in council policy arose out of a notice of motion by Greens councillor, Kerry Brown, in February last year, suggesting a move away from financial institutions that support the fossil fuel industry.
Council then created and adopted a revised policy which gives preference to environmentally and socially responsible institutions (where the rate of return is equal to comparable investments on offer).
Cr Brown said the new policy showed council can make money “out of the greater good”.
She also said council’s investment portfolio should abandon harmful products within a few years.
“My intention, that was reflected in the policy approved last October, was for council to be able to divest completely from fossil fuels and other endeavours that damage the well-being of people and the planet.
“It is terrific that we now have seven per cent of our reserves with Green Bank ME and almost three per cent with a responsible investor like Suncorp.
“I hope that it is only a few years before we can confidently say that all council investments are making money out of the greater good,” she said.
Under council’s old policy, 100 per cent of its investment had to be with institutions that held a AAA rating – namely, the big four banks.
But Cr Brown said the royal commission had shown that their investments were “neither environmental nor ethical”.
She said that council’s new credit framework allows up to 10 per cent of investment with BBB rated institutions. “This includes small green banks like ME that invest in low carbon infrastructure and clean technologies.
“Up to 100 per cent of our investments can be in AA rated institutions. Although that now includes the downgraded big banks, it also includes successful community-run institutions like Family First Credit Union and Bendigo Bank.
“Both have policies of ethical and sustainable investment, do not fund fossil fuels and return their profits to the community.”
Fellow Greens Cr Brent Hoare also commended the new investment policy.
