The ethical question
In Metamorphosis, Franz Kafka explores the idea of whether we change as individuals or whether we stay the same and the world changes around us.
“Like most people,” says a friend of the Lens, “I took up my first pension in my twenties when retirement was just a vague concept, and something firmly meant just for old people. It was the 90s and I probably would have avoided it altogether if I didn’t have a friend who was a recently qualified financial advisor who needed to fill his quota of new clients to pass his probation.”
This was back in the glory days of financial advice (pre-RDR) so utilising a friend was one of the best ways of guaranteeing some level of independent advice.
“However, if memory serves me right he was regularly ‘entertained’ by providers of financial services and still waxes lyrical about the generosity of Northern Rock.”
Thinking back to the strangeness of a childhood friend asking intimate questions about his personal finance, one question in particular stands out, says the friend of the Lens.
“After taking considerable time to assess my attitude to risk and long-term goals he then casually dismissed the ethics question by saying ‘you’re not bothered about this are you?’ When I asked him what it meant he told me that if I really wanted to avoid investing in carbon, arms sales, dictatorships, etc, I could opt out of investing in any funds that had exposure to them. However, it would have a seriously detrimental impact on performance, and I would have to be some crazy minded hippy to be serious about it.”
So, what did you do?
“I didn’t tick the box.”
In the past 30 years, the world has undoubtedly changed and there is now an enormous range of high performance ESG funds combined with a huge appetite amongst investors.
“Maybe it’s time I asked myself that question again,” the friend concludes.