126. Vegan Investing: How to Beet the Market! 🥕

In a world grappling with climate change and animal welfare concerns, a new investment trend is taking root - vegan investing. This episode dives deep into the rapidly growing world of cruelty-free, plant-based portfolios.

We'll explore how vegan ETFs like VEGN are empowering investors to align their money with their values, without sacrificing returns.

Whether you're a hardcore vegan or a conscious capitalist, this eye-opening episode will inspire you to build a portfolio that lines up with your own societal values.

Links from today’s episode:

The World’s First Vegan ETF

https://veganetf.com/ 

ICYMI another episode you might enjoy:

Episode#119 Investing According to Islamic Principles

Connect With Genet “GG” Gimja:

Website https://www.progressivepockets.com

Twitter https://twitter.com/prgrssvpckts 

Work With Me:

Email progressivepockets@gmail.com for brand partnerships, business inquiries, and speaking engagements.

Transcript

Welcome to Progressive Pockets! I go by GG, that’s short for Genet Gimja. This is a show about all the different things we’d like to change in this world and how we might be able to use our wallets to help.

One of the topics that comes up a lot on this show is alternative ways to invest. Rather than putting your money into any generic mutual fund out there or just sticking with the employer offered 401Ks, what are the alternatives that are out there.

And people are exploring ways to line up their societal values and the way they invest in all sorts of creative ways. Maybe you heard episode 119 Investing According to Islamic Principles. That is a fascinating topic, faith based money practices will never stop being interesting to me.

Well, I thought I had heard it all until a few months ago when I heard a presentation by a couple of young ambitious investors. They were talking about vegan investing.

I put down my steak sandwich and my milkshake, I unzipped my leather jacket and I said “oh, I have to hear this.”

I love it. I am so energized hearing about ways that people are living their values. There’s something countercultural in the best way that just really catches my attention.

So let’s talk about vegan investing today.

The presentation was given by an organization called Invest Vegan which has since changed its name to Ethical Capital Investment Collaborative. So I want to thank them for the inspiration to learn more about this topic.

The most basic definition of vegan investing is that it is investing in companies that don’t harm animals. One vegan venture capital firm called Capital V used this phrase “achieving an economy without the use of animals.”

And when you read about vegan investing or hear people in that field talk about it, they are mainly talking about avoiding the use of animals as a food source and for product testing. It probably isn’t a surprise that vegan investors tend to also care about the environment. So environmental consciousness is usually part of their investing criteria as well.

Vegan investing involves screening out companies that are involved in animal testing, animal-derived products (meat, dairy, eggs, leather, etc.), animal farming, or use animals for entertainment or sports purposes. 

The goal is to build an investment portfolio consisting of companies that do not use or profit from animal exploitation in any way and have a minimal negative impact on the environment and climate change. 

The first step for some investors is to screen out the companies that are engaging in practices that are against our values. So for example, in the case of vegan investing, screening out these companies that are exploiting animals.

But the second step for some investors is to actively look for companies that are trying to solve the problem. So when it comes to vegan investing, this includes companies producing plant-based foods, cruelty-free products, renewable energy, and those with strong environmental practices.

Believe it or not there are vegan focused ETFs like the US Vegan Climate ETF (VEGN) that follow strict ethical screening criteria. I want to talk about this ETF as an example we can learn from, not as an endorsement. I am not a financial advisor and I do not have this ETF in my portfolio or a stake in this either way.

The US Vegan Climate ETF (VEGN) was the world's first vegan ETF, launched in September 2019.

They are including large-cap U.S. companies based on factors related to animal cruelty, fossil fuel use, environmental damage, and human rights.

They detail that on their website. They will not include companies that are reliant on any of these harmful activities, and they have divided that into 3 categories: Animals, People, and the Planet.

When it comes to animals. They will not include companies who rely on:

• Animal testing.
• Animal-derived products, animal farming, and other exploitation activities.
• Animals in sport and entertainment.
• Research, development, and use of genetically engineered animals.

When it comes to the planet. They will not include companies who rely on:

• Extraction or refining, or services principally related to the extraction or refining, of fossil fuels.
• Burning of fossil fuels for energy production.
• Other activities having a significant negative environmental impact (e.g., high carbon intensity activities, high climate change impact, habitat destruction), unless the applicable company undertakes positive initiatives that effectively address those impacts.

And when it comes to people. They will not include companies who rely on:

• Tobacco products.
• Armaments and products specifically designed for military and defense uses.
• Contributions to the abuse of human rights or lack of robust, detailed, and independently published policies covering human rights and child/forced labor.

By the way, I am focusing on the US index today but they have also created a European index for my listeners in Europe who might be interested in that. All of the info is located at vegan etf dot com, links are always in the show notes.

The fund aims to invest in companies that avoid animal exploitation, fossil fuels, and activities that contribute to climate change and environmental destruction.

Top holdings include NVIDIA, Broadcom, Visa, Mastercard, Apple, UnitedHealth, Salesforce, and Tesla as of Spring of 2024. Expense ratio of 0.60% and net assets of around $90ish million around that same time.

So that’s pretty standard for a lot of these ETFs and Index Funds that are trying to be a little more socially responsible than the standard offering. But if you dig, you find some investments that really speak to screening in some positive companies. For example, they are including:

• Beyond Meat- this is a plant-based meat alternative company. I want to say they make the vegan whoppers at Burger King.
• Oatly - this is a dairy alternative brand, I’m seeing it globally at fancy cafes
• Else Nutrition - this is a plant-based children's nutrition company

So they’re doing some of the level 1 effort which is screening harmful companies out and then they are also doing level 2 which is proactively including companies that are trying to solve the societal problem.

And this is just one example of a vegan investment product out there. The point is, if you are vegan, you might be able to better align your investment portfolio with your lifestyle. 

So to recap, here’s what we covered today:

• Vegan investing seems to have come about in the last 10 to 15 years.
• Vegan investors are concerned about factory farming, they are concerned about the environmental impact of animal agriculture, they are concerned about animal cruelty and exploitation.
• We talked about one of the vegan ETFs today but it’s not the only one, there’s another one with the stock ticker EATV that’s another one if you’re interested to see how this concept plays out in reality

So that’s it. Vegan investing. Who knew? I’d love if you would send a text message right now to a friend or your favorite cousin about this episode. Maybe they have never heard of vegan investing either. Or maybe they have, and they have thoughts! You sending this episode out is really the only way that this show can grow. If you think about it, youtube videos and other platforms have algorithms that push content towards the right people, people who might enjoy it. But podcasts are different. There is no algorithm. There’s only people like you and I sharing episodes that we like with our friends and family, our neighbors, our buddies from the gym, from church, from your local vegan club lol. Please share this episode.

Let’s end with a quote…

“We need, in a special way, to work twice as hard to help people understand that the animals are fellow creatures, that we must protect them and love them as we love ourselves.”

And that quote comes from Cesar Chavez. Yes that Cesar Chavez. The civil rights leader.

Let’s talk again soon!