Ways Olympia Residents Can Make an Impact on Earth Day and Every Day

April 22 is Earth Day.  Earth Day was first celebrated 51 years ago on April 22, 1970.  US Senator Gaylord Nelson conceived the idea of establishing a day to educate people on the environmental challenges facing the Earth.  The first Earth Day was a celebration of the earth through advocacy and activities for school age children such as recycling, clean ups, and tree planting.  Even though 50 years have passed and much has been done to clean up our land, water, and air, much work remains. 

Gifting some of your time or treasure, in the form of cash or other assets, is an excellent way to make a difference.  Here are some organizations that make an impact in Olympia, Tumwater, and Lacey communities:

GRuB:  A local nonprofit organization helping youth, veterans, and food insecure people by helping them build their own gardens and growth their own food; see:  https://www.goodgrub.org/

Capitol Land Trust:  A local organization dedicated to preserving vital natural habitats; visit them at https://capitollandtrust.org/

Stream Team:  An intra-governmental organization dedicated to clean water and protecting the watersheds in Olympia, Tumwater, and Lacey.  To get involved or volunteer:  https://streamteam.info/get-involved/

Thurston Climate Action Team:  A local nonprofit dedicated to bringing the community together to stop climate change.  To donate or get involved:  https://thurstonclimateaction.org/

Charity Navigator: You can gift to causes that help support a cleaner and healthier environment with a national or international impact.  Charity Navigator has tools on their website that allow you to evaluate the effectiveness and financial efficiency of charitable organizations.  To see a list of highly rated charitable organizations with a focus on environmental issues:  https://www.charitynavigator.org/index.cfm?bay=content.view&cpid=6234

In addition to volunteering or making financial gifts, your purchases can also make a difference.  Purchasing local products from the Olympia Farmer’s Market or the Olympia Food Co-op helps support farmers that live in our communities and can reduce the pollution involved in transporting goods to the market.  Additionally, buying organic produce helps ensure you are not consuming pesticides.  It also helps keep our rivers, streams, and Puget Sound healthier for the fish and aquatic life that live there.  Lastly, your purchases encourage stores to keep stocking these products, further strengthening these businesses.

Your investment choices can also help drive change.  Many remember how the boycotts of South African products and investments helped end apartheid.  By directing your investment dollars towards companies that have a record of being good stewards of the environment, you help influence business decisions.  Businesses want to prosper, thrive, and grow and stock growth is an important measure of business success and often an important element of executive and employee compensation.  As business leaders see investors make stock purchasing decisions based on companies’ environmental policies and stewardship, they may be persuaded to make positive changes within their own firms.  Additionally, investors can make an impact through shareholder advocacy – by making their interests known to boards and insisting that business leaders be good stewards of the environment.

Investors that want to align their portfolios with their environmental or social values should become familiar with a few terms.  Investments that look to incorporate these values are often called green, sustainable, Socially Responsible Investing (SRI), or Environmental, Social, and Governance investing (ESG).  These are all similar terms with the broad goal of screening out undesirable companies and directing investment dollars towards those that are responsible stewards of the environment, those that look to reduce their impact on climate disruption, those that look to support diverse leadership, and companies that support employees from diverse racial backgrounds and sexual orientation. 

When incorporating sustainable/SRI investments into your portfolio, make sure you consider the following:

Find the fund combination that allows you to achieve your goals.  Getting to financial independence (or retirement) is an important goal for many of us.  Knowing how much growth you need and the asset allocation (what portion of your portfolio is composed of stocks and bonds, US and international companies, various market sectors, etc.) that can allow you to achieve your goals is critical. 

Understand your risk tolerance.  Markets can be very volatile and play havoc on your sleep and your health.  Investors that jump in and out of the market can also do serious harm to their long-term goals.  Taking time to understand your appetite for market ups and downs is an important step in determining the mix of stocks and bonds (asset allocation) that you can stick with in good times and bad. 

Maintain robust diversity.  Some sustainable/SRI funds only hold a few hundred companies; make sure your SRI portfolio contains thousands – of every size, from every industry, and country (that actually has publicly traded companies).  The more companies in your portfolio, the less chance you will miss out on the better performer’s superb returns and conversely, your portfolio won’t be roiled because you were over-concentrated in stocks that were poor performers.

Keep an eye on internal costs.  Look at your mutual fund’s expense ratio.  High expense ratios create a drag on long-term performance.  While SRI portfolios are often a little more expensive than conventional funds, aim for expense ratios under 0.50%.

Consider the big picture.  Thinking in broad themes (avoiding companies with a history of toxic spills and those that are the biggest contributors to climate disruption) makes it easier to find funds that do most of the things you want.  While you may not find a fund that screens out all the companies you want to exclude, you can find funds that are excellent and help you make an impact.

Do something.  If you have challenges building a diverse, low-cost SRI portfolio, consider a core and satellite approach.  This strategy employs conventional funds to comprise the core of your portfolio and SRI to compliment your portfolio with companies that are better stewards of the environment.

Have realistic expectations.  Sustainable/SRI funds have the extra task of screening out funds that do not meet their criteria.  This usually results in additional costs.  Additionally, sustainable/SRI funds exclude thousands of companies that may be excellent performers.  While some people suggest sustainable/SRI funds may do better than their conventional brethren because of less liabilities and their forward-thinking mindset, it is likely they will somewhat under-perform due to the reasons described above.

The environmental challenges we face can seem overwhelming.  The important thing to do is to take whatever action you can.  There’s no better time than Earth Day to start making an impact.