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Big Issue launches ethical fund platform

New ethical fund platform offers social and environmental impact funds
October 20, 2020
  • The Big Exchange rates funds’ ethical credentials
  • 36 funds currently available

The Big Issue Group has launched an investment platform exclusively for funds that aim to have a positive social and environmental impact, in a bid to tap into the recent surge in demand for more socially-conscious investments.  

The Big Exchange, which launched last week, currently gives access to 36 funds, all of which have their ethical credentials measured via a ‘Gold’, ‘Silver’ or ‘Bronze’ rating. 

The exchange analyses how the individual holdings within each fund are contributing to the United Nations Sustainable Development Goals and only funds that meet their criteria for sufficient positive contribution are allowed on the platform. 

Users of the platform can choose to invest in any individual fund or select a ready-made portfolio based on their risk profile. The Big Exchange says that all the funds aim to deliver strong financial performance as well as impact, without one being sacrificed for the other. 

While there is no guarantee that so-called sustainable funds will outperform their conventional peers, their performance has broadly proved resilient in recent years. The Good Investment Review, for example, published in April this year revealed that 69 per cent of UK equity funds marked as sustainable, impact or ethical outperformed their wider sector average over five years to the end of February 2020.

The minimum investment amount on The Big Exchange is low at £25 per month. Charges are set at 25p for every £100 invested on the platform (or 0.25 per cent), with no time period lock in. This makes the charge pretty competitive for investors with portfolios under about £50,000. The Big Issue is the platform's largest shareholder, and any profits it receives will go towards the group's mission of helping those facing poverty.    

Customers using the platform can place their funds in an individual savings account (Isa), junior Isa, or in a general investment account. The website says they will be adding self-invested personal pensions (Sipps) to the platform soon.  

The launch of the platform comes as fund managers are under increasing pressure to improve their environmental, social and governance (ESG) credentials. It includes established players in the sustainable investment space, with Liontrust’s Sustainable Future fund range and WHEB Sustainability Fund, which have performed very well in recent years. It also has more targeted funds such as Pictet’s thematic range and Aberdeen Standard's Impact Employment Opportunities Fund.   

Other asset managers with funds on the platform include, Alliance Bernstein, Alquity, Civitas Social Housing, Columbia Threadneedle, Nordea Asset Management, Pictet Asset Management, Quilter, Stewart Investors, Ecofin and Union Bancaire Privee. 

Nigel Kershaw OBE, chair of The Big Exchange and of The Big Issue Group, commented: “We created The Big Exchange to transform the financial system and give the  opportunity for everybody with savings to invest in funds that give them a financial return as  well as making a positive impact on the world around them. Through the tragic Covid-19 crisis we are seeing more and more people wanting to make their money count for more both for today and for future generations.”