By Clara Vondrich
Where goes investment, there goes the climate. This is the fact today as we stand on the brink of locking in irreversible climate change with our fossil-heavy economy. Like never before, institutional investors have the power to make or break the future.
The International Energy Agency published a bombshell report in 2011 noting that our climate fate would be sealed by 2017 without a rapid departure from business as usual. By that year, dangerous warming of more than 2 degrees Celsius would be locked in by a global system of long-lived pipelines, refineries, power plants and transportation systems. Since then, the "safe" level of warming has been tightened further to 1.5 degrees, with evidence that 2 degrees is a death warrant for many island nations.
It's now 2017 and the pace of the clean energy transition still lags behind the physics. Some say 2 degrees, much less 1.5 degrees, is a pipe dream. The upshot is that every investment we make into our energy system matters, bringing us either closer to or further away from climate hell. By this measure, the policies of China—closing its coal plants and committing hundreds of billions of dollars to renewable energy—are prudent, while the rhetoric and policies of the Trump administration—promising to rebuild America's coal industry and firing off executive orders to fast track the Keystone XL and Dakota Access pipelines—are retrograde. One creates an enabling environment for progress and thriving, the other is disabling and destabilizing.
China Leaves U.S. in Dust With $361 Billion Renewable Energy Investment https://t.co/4GfhGZhcyX @BusinessGreen— EcoWatch (@EcoWatch) 1483871415.0
In the face of Trump's commitment to double-down on dirty energy, the DivestInvest movement is more important than ever. The investor class manages trillions in assets that will either be used to build the clean energy future or keep us mired in the past. Luckily, nearly 700 institutional investors managing assets in excess of $5 trillion have made some form of fossil fuel divestment commitment. This includes global insurance companies like Allianz, sovereign wealth funds like Norway's and preeminent universities, cities, faith organizations and foundations.
Still, to divest is not enough. A commitment to invest in the clean energy future—renewable energy, efficiency, sustainable agriculture and forestry, water and cleantech—is just as crucial. The whole energy system must be rebuilt, reimagined—moving away from a monolith of centralized power stations to a mix of utility grade wind and solar farms, microgrids and distributed clean energy systems. The foundations of DivestInvest Philanthropy understand this and hence their commitment to invest part of their portfolio annually into climate change solutions.
Investors in the future have the markets at their backs: Electricity from solar and wind power is now as cheap—or cheaper—than its fossil counterparts in much of the world.
Batteries are sailing down their cost curves with price reductions of 60 percent or more over the past 6 years. Electric vehicles are projected to hit parity with gasoline cars by 2022, a point totally disruptive to the oil industry. 2015 saw the world's highest annual investment into clean energy of almost $350 billion. Renewable energy comprised more than half of all new power-generating capacity that year, overtaking coal in total installed power capacity worldwide. Coupled with the formidable market signal of the Paris climate agreement, investors in the clean energy economy are in pole position to do well while doing good.
Meanwhile, the carbon bubble is bursting—sometimes quickly, sometimes slowly. Coal's fall was fast and furious: The Dow Jones U.S. Coal Index dropped more than 80 percent over the past five years and former lions of industry Peabody and Arch Coal have filed for bankruptcy. Oil and gas seem poised to limp along a few more years, though prices remain depressed and volatile. Last month, Chevron posted its first loss in decades, while Exxon saw its smallest quarterly profit in 17 years: Most striking, it also wrote off $2 billion in gas fields—finally admitting it was not immune to stranded assets. Shell itself says that oil demand will likely peak within the next five years followed by precipitous declines as electric vehicles come on-line en masse.
It's Official: Solar Energy Cheaper Than Fossil Fuels https://t.co/BEGahnj1tM @Solar_Editor @solarcentury— EcoWatch (@EcoWatch) 1483002912.0
Yet, among institutional investors, there remains anxiety around the perceived lack of green products to sink their teeth into. But two new reports by Mercer and Croatan Institute chip away at the myth that there are not adequate investment opportunities into the clean energy future. Each assessment takes a portfolio-wide approach, looking at opportunities across all asset classes of a typical institutional portfolio.
The Mercer work provides the most comprehensive analysis of funds consistent with the DivestInvest pledge, looking at opportunities across public equity, fixed income, absolute return/hedge funds, private equity and infrastructure. The emphasis is on commingled institutional investment vehicles (pooled funds), rather than mutual funds, which have been catalogued by other groups. Mercer's full product list is available to DivestInvest signatories.
Meanwhile, the Croatan Report explores investments in climate solutions that also have a direct benefit to the local community. Many of the investments featured in the Croatan Report are consistent with the notion of a Just Transition, the idea that the clean energy transition should not recreate old and broken power structures that benefit the few at the expense of the many: Rather, investments should be made with intention to revive and rebuild communities, fostering job creation and local ownership of renewable energy systems where possible. The report is anchored in inspiring case studies featuring DivestInvest Philanthropy members.
These reports are essential contributions—showing that there is a robust and growing supply of investment-grade opportunities in the clean energy transition. In 2017, the stakes couldn't be higher.
Clara Vondrich is the director of DivestInvest Philanthropy.
The scope of global fossil fuel divestment has doubled over the past 15 months, with institutions and individuals controlling $5.197 trillion in assets pledging to divest. The announcement comes on the first anniversary of the Paris agreement on climate change.
"One year after the adoption of the historic Paris climate agreement, it's clear the transition to a clean energy future is inevitable, beneficial and well underway, and that investors have a key role to play," said UN Secretary-General Ban Ki-moon.
"I commend today's announcement that a growing number of investors are backing a shift away from the most carbon intensive energy sources and into safe, sustainable energy. Investments in clean energy are the right thing to do—and the smart way to build prosperity for all, while protecting our planet and ensuring no one is left behind."
According to a new analysis released today by Arabella Advisors, 688 institutions and 58,399 individuals across 76 countries have committed to divest from fossil fuels. Those sectors that have historically propelled the movement—including universities, foundations and faith-based organizations—account for 54 percent of new commitments made.
Representatives from finance, philanthropy, faith, entertainment, education and others announced these numbers and showed their support for the movement at a simultaneous international press conference today in New York and London—including a former top Mobil Oil executive, Lou Allstadt, who helped implement the Exxon-Mobil merger.
"As the hottest year in history comes to a close, the success of the global fossil fuel divestment movement is undeniable," said May Boeve, executive director of 350.org, the grassroots climate organization whose members have led the charge to divest.
"What began on a few college campuses in the U.S. has spread to every corner of the world, squarely into the financial mainstream. Divestment has permeated every sector of society: from universities and pension funds, to philanthropic and cultural institutions, to cities, faith groups, insurance companies and more. Now at $5 trillion, the movement is unstoppable. Institutions and investors must choose whether to be on the right side of history."
May Boeve, Adrian Grenier and Mark Ruffalo at today's press event announcing $5.197 trillion in assets pledging to divest from fossil fuels.DivestInvest
Support for the movement among early adopters is now increasingly being met by support from profit-driven institutions such as large pension funds, private insurers and banks, which represent $4.5 trillion in assets, citing climate risks to their investment portfolios. As more mainstream financial institutions commit to divest, the industry faces greater scrutiny.
"The oil and gas industry is currently experiencing an unprecedented level of negative factors—from reduced profits to increased borrowing to pay dividends—while the costs of solar, wind and batteries continue to fall," said Lou Allstadt, former executive vice president of Mobil Oil. "The prudent fiduciary is acting now to reduce the risk to their portfolios. Divestment is speeding up the clock on the final accounting that will show fossil fuels are out and clean energy is in."
Mark Campanale, founder and executive director of Carbon Tracker Initiative, agrees. "The financial markets are fast losing faith in the investment case for fossil fuels. A technological revolution is underway in the energy and transportation sectors, as cheap solar and electric cars take away demand for coal and oil. With a climate trifecta of physical risks, stranded assets and the threat of legal liability—fiduciaries are now on notice to implement measures to protect their portfolios."
Today's press conference also brought forward historic new divestment commitments, including Ireland's preeminent university, Trinity College.
"Trinity intends to play our part in delivering on the Paris agreement," said Dr. Patrick Prendergast, the provost and president of Trinity College Dublin. "We aspire to be a leader in sustainability and climate solutions in every aspect of the college, not only in investments but in our research, and also in how the campus operates."
The report also documents rapid growth in the faith sector fueled by Pope Francis' "Laudato Si" encyclical establishing a moral imperative to act on climate, but commitments in the faith sector are not bound to any particular religion. A recent interfaith statement calling for divestment was signed by 303 faith leaders from 58 countries.
"Islam, like other faiths, teaches and asks its adherents to implement an ethic of restraint and conservation," said Imam Saffet Abid Catovic, board member of Islamic Society of North America Green Masjid Task Force. "In the face of the global climate crisis, this ethic, while necessary, is not sufficient to meet this existential challenge and must be coupled with a 'keep it in the ground' investment policy: divesting from fossil fuel holdings and reinvesting a portion of these funds in renewable and clean energy alternatives."
"What the world needs now is DivestInvest Culture: A bold, collective pivot away from the old energy that no longer serves us, and toward the 100 percent renewable energy future that will let the people and the planet thrive," said actor Adrian Grenier, announcing the new campaign today. "I am so excited to help launch DivestInvest Culture today—we are actors, musicians and artists moving our money from the past to the future."
These global and unparalleled commitments by both the public and private sectors are further cementing the call for a clean energy transition—and challenge the U.S. energy policy of the Trump administration, which is shaping up to favor the expansion of the financially risky and environmentally destructive fossil fuel industry.
"At the one-year anniversary of Paris, and after a historic election in the U.S., divestment is needed more than ever," said Ellen Dorsey, executive director of the Wallace Global Fund and leader of DivestInvest Philanthropy. "When governments fall short, people step up. From Apartheid South Africa to the climate front lines, finance is a proven lever for change. Governments should keep their promises, but investors must move their money."
Rugs add a cozy aesthetic to the home, but they can also contribute to toxin exposure if you’re not careful when shopping around. How do you find the best sustainable rugs in a world where almost everything is mass produced with questionable chemicals involved?
There is a lot to consider in the search for a nontoxic rug you hope was ethically made. That’s especially true in a time where we are reevaluating our environmental impact every day. We rounded up four of the best sustainable rugs for any area of your home, from your living room to your outdoor space. Read on to learn more.
Best Sustainable Rugs: Our Recommendations
- Best Overall: Safavieh Handmade Flatweave Jute Area Rug
- Best Cotton Rug: Lorena Canals Washable Rug
- Best Runner: Chardin Home Runner Rug
- Best Outdoor Rug: Fab Habitat Recycled Plastic Outdoor Rug
Each product featured here has been independently selected by the writer. Learn more about our review methodology here. If you make a purchase using the links included, we may earn a commission.
Why Switch to a Sustainable, Nontoxic Rug?
Many people want to secure an area rug in the most affordable, fastest and easiest way. However, that often leaves your choices limited to rugs that are most likely not sustainably or ethically made.
Most ordinary new rugs and carpets contain harmful chemicals called volatile organic compounds, or VOCs. They can off-gas for up to five years, emitting VOCs in your home and causing short- and long-term health issues including headaches, dizziness, liver and kidney damage, and even cancer in animals and humans. An eco-friendly rug choice avoids these adverse health effects.
You may also wonder why you need a special cleaner filled with questionable chemicals for a rug. In some ways, you end up spending more money over time on a synthetic rug that ends up in the landfill.
By choosing home decor products made from sustainable materials, you can make a positive impact and promote a kinder and healthier planet.
Full Reviews of Our Top Picks
Best Overall: Safavieh Handmade Flatweave Jute Area Rug
Safavieh is a trusted name in natural rug making that has been around for over 100 years. Its handmade flatweave jute rug collection contains size and shape options ranging from 3-by-5-foot area rugs to 5-by-6-foot ovals to 9-by-12-foot runners. The rug is handwoven, and the beige color and traditional weave of sustainably-harvested sisal and seagrass make it a classic option for any space.
Customer Rating: 4.6 out of 5 stars with over 600 Amazon ratings
Standout Review: “These rugs are absolutely awesome… They're both easy on the eyes and the feet. We have a round one in the entryway and an oval one at the bottom of the stairs… They are easy to vacuum and sweep, combining pleasing aesthetics with functionality and durability.” — Alison via Amazon
Why Buy: Safavieh is known for its high-quality yet affordable products. The flatweave jute rug is beautifully handwoven and provides a classic, minimalist look to any area of the home.
Best Cotton Rug: Lorena Canals Washable Rug
Lorena Canals’ washable cotton rugs are made with a base of 97% recycled cotton and use only natural dyes in the coloring process. They’re handcrafted by artisans in India and can give a warm yet modern touch to your home. This particular rug measures just over 5.5 by 8 feet, but there are other size options available.
The company’s RugCycled program utilizes textile leftovers from the production of its cotton and wool rugs, helping Lorena Canals’ overall process become less wasteful. Plus, every purchase helps a child in North India attend school.
Customer Rating: 3.8 out of 5 stars with under 10 Amazon ratings
Standout Review: “Taking 1 star away because by no means it can be washed in a regular washer machine… Now do I like this rug? I LOVE IT! It is worth the trip to the laundromat.” — Ann via Amazon
Why Buy: If you’re looking for something you can throw in the wash after a spill or accident, this is one of the best sustainable rugs to consider.
Best Runner: Chardin Home Runner Rug
Chardin Home collects cotton rags from different factories and upcycles them into multicolor rugs. No two rugs are exactly the same, though the company makes every effort to best match them if you buy more than one of the same kind. The most popular size is this 2-by-7-foot, but the rug options span from 2-by-5 feet to up to 8-by-10 feet. The rugs are also reversible and long-lasting.
Customer Rating: 4.6 out of 5 stars with almost 1,500 Amazon ratings
Standout Review: “With this rug, suddenly everything goes together beautifully! … I have an 8-year-old, two dogs (5 pounds and 40 pounds), and a cat. I’ve had this rug for a bit, and it has held up so well.” — Lauren W. via Amazon
Why Buy: This affordable, colorful runner is reversible and withstands your pets while being healthy for them. It’s one of the best sustainable rugs for narrow spaces.
Best Outdoor Rug: Fab Habitat Recycled Plastic Outdoor Rug
Made from recycled plastic straws, this rug by Fab Habitat is perfect for outdoor spaces. Some people also use these indoors (I personally use an outdoor rug under my bed). The rug is fade-resistant and stain-deterrent. The material also means the rug will never be threatened by moisture.
This 5-by-8-foot rug comes in several eclectic and oceanically-colorful designs from jodhpur blue to monochromatic teal and a more practical blue. At an affordable price, it helps save both the planet and your purse.
Customer Rating: 4.6 out of 5 stars with over 1,100 Amazon ratings
Standout Review: “This rug lives up to its reputation. We just moved to Florida, and it rains almost daily since we got here. This rug doesn’t hold water, and it feels smooth under your feet.” — Katelyn via Amazon
Why Buy: The U.S. city-by-city ban on plastic straws started around 2018, but they still overtake landfills and take ages to decompose. A recycled plastic straw rug helps provide one solution to this while being stylish, stain-deterrent, fade-resistant and easy to clean. Just shake it out and hose it down.
How to Choose the Best Sustainable Rug
There are a few factors to consider when purchasing the best sustainable rug for your home:
- Natural fibers: What material is the rug made out of? When looking for nontoxic rugs, choose natural fibers like organic cotton, jute, wool and sisal. Agave sisalana is the botanical name for sisal, which is native to southern Mexico. Many fruit plants also make cozy natural textile materials in place of genetically modified cotton.
- Material harvesting and manufacturing: Was the material ethically harvested? Was the rug sustainably made? Is it an ethically made rug? Was the rug treated with any chemicals?
- Cost: A handmade rug understandably costs more than a mass-produced one. However, you should also shop around and stay within budget.
- Style: Many natural fiber and sustainable rugs are varied and unique in design. Have a look in mind when shopping for an organic rug to ensure you will be happy with the aesthetic.
Note that some natural fibers, like jute, can shed and may tend to unravel lightly in some areas over time. That’s the nature of the material.
Frequently Asked Questions: Best Nontoxic Rugs
How do you know if a rug is toxic?
A rug’s surface can consist of natural fibers. However, many don’t consider that the rug's backing and underlay padding could contain toxic materials. All parts of the rug should be produced with natural materials. Unfortunately, you may also find hidden toxins in the form of formaldehyde, stain deterrent treatments and flame retardants on the surface of the rug.
Are jute rugs environmentally friendly?
Yes, jute rugs can be very environmentally friendly. Jute is a sturdy natural fiber that many consider to be one of the most eco-conscious materials out there. Jute comes from a tropical plant and is both recyclable and biodegradable. Jute fibers are spun into durable threads to create such products as twine, mats and rugs.
Are handwoven rugs ethical and sustainable?
It is ethical to purchase from a craftsperson who used their skills and traditional practices to thoughtfully make a beautiful and sustainable rug. However, many products that are labeled “sustainable” can still be produced unethically and illegally via child labor and human rights violations. A good resource to check is Amnesty.org, which recently discovered human rights violations by larger U.S. companies in the production of “sustainable” palm oil.
Research each product and manufacturer across various platforms, always checking reviews and non-biased news sources. Where possible, purchase ethical rugs from craftspeople directly. Local maker collectives and arts organizations are great places to start.
How do you clean a natural fiber rug?
Drenching a natural fiber rug with wet shampoo or steam can cause damage and discoloration. Spot-clean natural fiber rugs with a mild detergent, or use club soda for acidic stains.
Routinely sweep or vacuum your rugs lightly, using a rug beater as appropriate. You can also buy a dry cleaning powder that is compatible with natural fiber rugs. Simply sprinkle this powder on the rug and vacuum it up. Take more heavily soiled rugs to a green dry cleaner if care instructions allow.
With fair labor practices and ethical standards in place, a rug made of natural fibers is a much more eco-friendly option than a rug made with toxic chemicals. Be wary of companies that greenwash their marketing with sustainability claims they fail to deliver on.
Where possible, consider handcrafted rugs when shopping for a rug for your home. It’s much easier to verify sustainability, and you support a talented individual and the local economy with your purchase.