We all create carbon emissions in our daily lives. For example, if I own a car, the emissions created from driving that car are my responsibility. To reduce my carbon footprint I could switch to an electric vehicle, get the bus more often, or try to cycle where possible. 

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Your pension fund invests in companies to make a return on your behalf. As a shareholder, you own a portion of these companies. Their production and manufacturing activities create carbon emissions. Just like the car example above, you are responsible for the carbon emissions generated by the companies that you own through your pension. 

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Pensions provide many benefits to us like tax-relief on contributions, tax-free growth until retirement, and an income in retirement, but is it possible to save for retirement without compromising our environmental ethics and values?

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A net-zero pension evaluates and screens companies before investing in order to reduce the carbon emissions from the fund. Carbon offsets are then used to equalise the remaining/unavoidable carbon created. The net-effect is that climate change is not accelerated by the investments in your net-zero pension. Ethico offer Ireland's only net-zero pension. Company pension schemes and individuals can enjoy the benefits of traditional pensions while investing sustainably for the future.

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So how do we achieve net zero for carbon emissions in your pension or investment fund? 

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First, let's look at traditional funds where most pension schemes are invested. The average carbon emitted from a traditional fund is 150 tonnes every year (per million euro invested)  - that's carbon dioxide equivalents, or green house gas emissions.

 

On average, ethical funds generate about 50 tonnes of carbon per year - that's a 66% reduction. We achieve this by utilising ethical investment funds which exclude many of the large contributors to climate change - like coal, oil, and gas companies. Ethico funds adhere to strict ESG metrics (Environmental, Social, & Governance) and prioritize climate positive companies when selecting investments. In simple terms, we remove the bad companies and include the good. 

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As a final step to achieve net-zero emissions, Ethico offset the remaining carbon via the United Nations carbon offset platform. https://offset.climateneutralnow.org/

 

This effectively reduces the emissions of Ethico pensions to net-zero now - without having to wait until 2050!

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Let's look at an example that may be helpful in estimating the carbon emission from your company pension scheme: