Sustainable finance is a climate solution

Your money makes a huge difference. Here's 4 things you can do with it to heal the planet.

Estimated reading time: 4 minutesΒ 

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Let's talk about πŸ’Έresponsible money management πŸ’Έ . Ever wonder what happens to your paycheck once it hits the bank?When we found out that our hard-earned money was being used to fight climate change, we were shocked. Turns out, the biggest banks in the world are propping up β€” and expanding β€” the fossil fuel industry.

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Here’s what we’ll cover step-by-step:Β 

  1. READ: What does it mean to divest from fossil fuels?
  2. WATCH: How do banks use your money?
  3. ACT: How can we use our money to heal the planet and finance a better world?
  4. REFLECT: How is finance creating disparities and perpetuating inequality?


The ways in which banks use our money is scary, especially after learning the costs of their impacts on our priceless planet.

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Fight climate change in a way that works for you.

πŸ’Œ Thinking about sustainability can be overwhelming after a busy workday, so we're here to help. Join over 7,000 other busy people and subscribe to Changeletter, a bite-sized action plan that'll take you 3 minutes or less to read every week.
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"The info is always timely, actionable, and never stale." - Aishwarya Borkar, Change.org
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"Making social change always felt so overwhelming until I started reading this newsletter."Β - Meghan Mehta, Google

How can sustainable finance solve climate change?

🎯 Action step 1 of 4: READ β€” Let's start by looking at a few articles together.

The financial industry is harming the climate and our planet. This 2019 New Yorker article by Bill McKibben, the environmentalist who started 350.org, breaks discuss how divesting from fossil fuels basically means pulling our money out of oil and gas.

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Here's what you'll learn from the article, "Money is the Oxygen on Which the Fire of Global Warming Burns":

  • πŸ’° We literally don't have enough money. A study found that warming the planet by 3 degrees celsius before 2100 would do 551 TRILLION $ in damage, which is more money than currently exists on the planet."
  • πŸ’₯ Divestment pressure works. "Funds worth more than eleven trillion dollars have divested some or all of their fossil-fuel holdings. I has been effectiveβ€”when Peabody Energy, the largest American coal company, filed for bankruptcy, in 2016, it cited divestment as one of the pressures weighing on its business." Say yes to peer pressure πŸ˜‰
  • 🏭 Divesting from fossil fuels will not break the world. Big Oil likes to tell us that if we divest, our whole economy will come crashing down, but that may not be the case. Let's look at Chase β€” "Fossil-fuel financing accounts for only about seven per cent of Chase’s lending and underwriting". If we divested, Chase would lend to solar/wind/other renewable companies and be just fine. But oil and gas wouldn't. Hee hee. 😈
  • πŸ’΅ Fossil fuel investing is destructive and unprofitable. In 2019, BlackRock, an asset management firm, was the world's largest investor in coal companies and companies driving deforestation. BlackRock investors lost 90 BILLION $ over the last decade "by staying heavily investing in fossil fuels."


We can't wake up tomorrow and stop using fossil fuels entirely, but we CAN wake up and divest! The New Yorker article covers banking, asset management, and insurance in depth, and shows how handling our money responsibly could be the fastest path to a cleaner and safer world.

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🏁 Checkpoint: This is the end of action step 1 of 4: READ.

What does your bank actually do with your money?

🎯 Action step 2 of 4: LISTEN β€” we'll watch a short video or listen to a podcast to further expand on our topic.

It wasn't until years ago that we gave a second thought to what happened to our money after we put it in the bank. We're going to walk through a one-minute overview on what banks do with your money followed by a two-minute clip on the biggest banking bad boys. It's OUR money β€” our hard-earned cash β€” financing climate change.

Today, we'll get a refresher on how this works through two very short videos (~1 min each).

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Here's what you'll learn:Β 

  • πŸ€‘ Your bank is paying you. When you deposit your money in a bank, it goes through a magical wormhole and comes back to you with interest.
  • 🏦 Your bank is spending your $. The magical wormhole is actually the bank lending YOUR money to other people/businesses. They charge those other people/business a high interest rate, give you your money back at a lower interest rate, and pocket the difference.

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Here's some fast facts:

  • πŸ‘Ž Big banks have paid almost 3 trillion to expand fossil fuel projects since signing the Paris agreement in 2015 (yes, the one that resolves to REDUCE climate change).
  • πŸ’¨ This $2.7 trillion, to be exact, could have been spent on installing salar panels on 215+ million homes or 580,000 wind turbines, enough to power every home in the US! $2.7 trillion would take us over halfway to a completely renewable energy grid.‍
  • 😭 JP Morgan, Wells Fargo, Citibank, and Bank of America are some of the biggest villains, financing fossil fuels while making public climate action commitments. Chase (where I have my credit card o god) has pumped 36% more into fossil fuels than its nearest competitor.
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You can learn more about your own bank in RAN's Banking on Climate Chaos report β€” it shows what nefarious lending banks from all over the world are up to. On a positive note, there's a lot we can do β€” closing our accounts with these banks and opening climate-friendly ones, rolling over our retirement funds into clean energy funds, and more.

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🏁 Checkpoint: This is the end of action step 2 of 4: LISTEN.

Four things you can do to finance a better world

🎯 Action step 3 of 4: ACT β€” Now it's time to do something. Let's go!

Sustainable finance is one of the more optimistic topics under the umbrella of climate change, in our opinion, because there's a clear path to action. So, without further ado, here's four things you can do:

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1. Find out: how does your bank score?

Chase is THE WORST. Major major yikes. They've done $317B in fossil fuel financing since the Paris agreement (you know, the agreement that says 'we agree to stop F-ing up the Earth').

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2. Sign Bank Green's pledge to not fund fossil fuels.

Public statements are powerful, so show your support in 15 seconds.

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3. Find a values-aligned bank.

We used Mighty Deposits to open a new savings account with NCB Co-op, which supports housing (instead of fossil fuels!). Here's their list of environmentally-friendly banks.

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4. Make your retirement fund fight climate change.

‍Make an account with Carbon Collective β€” it doesn't make sense for your own retirement money to fuel climate destruction, does it? Imagine what your grandkids would say.

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The first two actions are short and sweet, and the last two will only be an hour-ish project, and these will go a LONG way. Let's invest in the future we want to live in.

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🏁 Checkpoint: This is the end of action step 3 of 4: ACT.

Another major finance issue: lending discrimination

Before we go any further, it's time for you to pledge your commitment. It takes less than 30 seconds to pledge and we can bother you about it in a friendly way, so we can hold each other accountable. Pledge here!

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🎯 Action step 4 of 4: REFLECT β€” what can you commit to? What fresh perspectives can we look at?

One fast factβ€”there's banking disparities in Chicago, USA. It's just one of MANY examples of financial institutions actively working to exclude people. Another example worth noting is how women worldwide are excluded from financial systems.

Sustainable finance isn't just about emitting less CO2. It's about building an equitable world. It's important to highlight that banks do a lotttt of shady stuff with our hard-earned cash. In most countries including the USA, you need the bank to do anything, like buy a house.


According to this Home Mortgage Lending Inequalities article on banking disparities:

  • 🏠 Loans for housing purchases are much harder to get in minority neighborhoods. "68.1% of dollars loaned for housing purchases went to majority-white neighborhoods, while just 8.1% went to majority-black neighborhoods and 8.7% went to majority-Latino neighborhoods."
  • 🌳 The culprits are the same. JP Morgan Chase, as we learned earlier this month, is one of the biggest villains investing in the climate crisis. In Chicago, "for every dollar the bank loaned in white neighborhoods, it invested just 2.4 cents in the city’s black communities". At least they're consistent lol??
  • 🏘️ Race, not economic status. Even middle-class Black Americans can't get the same loans β€” simply because a home is in a historically Black neighborhood, it can be appraised (valued by lenders) for a much lower amount.
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Discrimination in lending is structural, whether we're talking about gender, race, or anything else. But we can fix our financial systems! All injustices are interrelated, and we all have a role to play.

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Just know that you money and where you put it makes a huge different on our planet.

β€πŸ Checkpoint: This is the end of action step 4 of 4: REFLECT.

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Check out our membership community for more resources like free weekly events with social justice experts, sustainable product discounts, pre-written email templates, a social impact job board, and in-person hangouts with new friends. Thanks for taking action with Soapbox Project!

Fight climate change in a way that works for you.

πŸ’Œ Thinking about sustainability can be overwhelming after a busy workday, so we're here to help. Join over 7,000 other busy people and subscribe to Changeletter, a bite-sized action plan that'll take you 3 minutes or less to read every week.
Headshot of Ash Borkar (a woman with glasses and a cardigan)
"The info is always timely, actionable, and never stale." - Aishwarya Borkar, Change.org
Headshot of Meghan Mehta speaking at Google with a microphone in her hand
"Making social change always felt so overwhelming until I started reading this newsletter."Β - Meghan Mehta, Google

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