Do Your Investments and Pensions Fund Fossil Fuels, Tobacco, Weapons, Land Grabs, Banks etc.?

If you, like the vast majority of folks, have a Defined Contribution pension plan the answer, to quote Queen Sarah of the North, is, "You Betcha". A few decades ago Defined Contribution {DC] plans were almost non-existent then came the huge increase in interest rates of the late 70s and early 80s which rattled everyone, especially workers of all types who thought they were seeing their future dreams dive while at the same time the investor class was seeing theirs skyrocket. Within a few years the old reliable Defined Benefit [DB] plans were being rolled over much to the delight of the investment fund industry.

Investment Fund Managers around the world saw their business explode as public and private pensions switched horses in mid-stream. All investment managers go to the same school - the school of MORE - not the long-term sustainable MORE, the short term now type. Funds earn income from fees, managers earn bonuses based on their fund's profits, fees are generated mostly when investments are rolled over [bought and sold] creating a huge incentive for quick in and out investments. Winning is good but turnover is better in a fund managers mind.

It's the same story whether you live and work in Cyprus, America or here in BC. In fact the inconvenient truth is that pensioners, mutual fund owners, term deposit owners etc. in BC's Lotus Land are at least as heavily invested in unethical industries as anybody because they are often legally mandated to invest heavily in Canada's energy resource heavy economy. None has more stringent investment regulations the BC's Public Employee Pension Fund.

B.C.’s public-sector pensions invest billions in Enbridge, other oil company stocks. They own huge amounts of  IPP shares, of the Peace River area's current Shale Gas fiasco, of the log exporting and coastal first growth logging industry, of...well of everything that many of their union member contributors protest against. Everywhere union and non-union pension and investment funds finance corporate land grabs that contribute to the hunger of the local populations when those lands are converted to bio-fuel crops. Investment funds own a majority of the manufacture, sale and distribution by gun and ammo companies. They own the majority of the tobacco industry's shares. Basically the only investment a fund manager considers as unethical are those that are expressly illegal - like land mine manufacturing.

Banks and other fund managers can be misleading about the fees their funds charge. For instance, as Financial consultant Preet Banerjee explains, “If you have a fund that has an MER of 2.5 per cent, that’s going to consume almost 50 per cent of the potential value of the portfolio over 25 years. When you frame it that way, it becomes very clear that fees are a big deal.” Add to that the chicanery and outright bribery [that's commonly called it's the KBF -kickback factor- by the in-crowd] swirling when the decision is being made as to which firm will manage those huge pension funds with their mandated monthly contributions to be invested [for a fee each time of course] and the fact that 'markets' go both up and down, it ends up that folks would be better off avoiding the whole shady industry and investing any extra money they have in their homes, their kids education or maybe the local organic food co-op.

All this remains invisible to most folks because...well because comforting lies trump inconvenient truths in naked ape psychology every time. But, as those folks in Cyprus are learning when the bubble bursts it's most often them that gets covered in crap.