Ethical Investment proposal rejected by local Tories

Last night's budget had Appendix D report on ethical investment in the Council papers - this was produced in response to a Green party amendment to a motion a couple of months ago - yet this report rejected the idea of ethical investment for Council funds saying it wasn't possible. A Labour amendment last night called for further investigation - despite strong arguments by Labour, Green and Lib Dems, the Tories rejected this move.

Photo: Moon over Stroud earlier this week

I have to say I am astonished. I was unable to attend the budget meeting but had circulated to Officers and the administration the views of ethical investment advisors saying it would be possible.

Clearly this is a complex area but the advice from experts I have been given is that we can do it. Why don't the Council want to look further at this? One Councillor even suggested that ethical investment meant poorer returns - what nonsense. Many ethical funds are doing better - and even if they weren't I would argue it is wrong to invest in carbon intensive industries, the arms trade, nuclear etc. It is wrong to profit from such practices.

It is certainly not illegal to lend to an institution with a slightly lower rate, local authorities are, in practice, constrained by the implications of the "Guidance on Local Authority Investments 2004" issued by the Office of the Deputy Prime Minister. The guidance states that authorities should seek the highest rate of return consistent with proper levels of security and liquidity.

But that is not the only point being made here - there are requirements in terms of security, liquidity and yield, but once those have been met then why can't we give consideration to ethical issues? The Coop for example has a very comprehensive ethical policy - the HSBC is streets ahead of Nat West when it comes to Climate Change.

I am not sure the next step but perhaps members will be able to request a Policy Panel as suggested previously to look at this again. I will be exploring how to take this forward. I am still hopeful.

On a more positive note it was great to hear from a Labour party County councillor who picked up this ethical investment from my blog or the Glos Green party website - he was interested in picking up on the ethical investment issue for his Council - have sent some details and hope he will be able to take the issue forward there. It is vital we all learn to pull together on these issues if we are to achieve the changes we need.