“It makes no sense to invest in companies that undermine our future. We need an apartheid-style boycott to save the planet.” Desmond Tutu, 2014
We know that over 80% of the world’s proven coal, oil and gas reserves need to stay in the ground if we want to stop climate change. And, yet, each year hundreds of billions of pounds is invested in finding new sources of fossil fuels that, if burned, will cook the planet. At least we haven’t got this crazed insanity on our consciences, right?
Well, actually it depends on how you look at it! Much of the money required to find and exploit new sources of fossil fuels comes from our investments in shares in these companies. The extent of pension fund wealth that is invested in fossil fuel companies is simply enormous.
There is a rapidly growing global alliance campaigning for divestment from these fossil fuel businesses. There have already been hundreds of successes in persuading universities, pension funds, churches and other institutions around the world to take their investments out of fossil fuels and into clean energy alternatives.
Divestment is a growing and increasingly successful juggernaut. Friends of the Earth is about to launch a new campaign mobilising the wealth of experience and existing contacts many FOE groups have from years of engaging with their local council. We are going to persuade local authorities to go fossil-free.
For the first time, thanks to 350.org research, we can reveal that across the UK, £14 billion of local government public money is invested in fossil fuels via pension funds. Three quarters of these direct fossil fuel shareholdings are in only ten companies, headed by BP and Shell.
The West Midlands Pension Fund alone has £355 million in fossil fuels. Its biggest direct fossil holding is £59m in Shell; others are BP, Rio Tinto, BHP Billiton and BG Group.
The West Midlands Pension Fund is one of the UK’s largest pension funds. It contains the Local Government Pension Schemes of seven local councils – Wolverhampton, Birmingham, Sandwell, Dudley, Solihull, Coventry and Walsall.
The responsibility for “strategic investment opportunities” and “implementation of investment policy” lies with the Investment Advisory Sub-Committee, which comprises representatives from the seven district councils and two local trade unions. It is ultimately this sub-committee which holds the power to change their investment strategy.
However, it will be a combination of ordinary people writing to Councillors, building pressure from the local media and social media, and possibly a large West Midlands-wide petition, that will determine the success of the campaign.
I will now make a prediction. This campaign will not be quick and easy! It is going to be a gradual process of building momentum and support with other local environmental groups, making alliances with groups who represent fund members, such as trade union representatives of council workers, the council workers themselves (not just Councillors), and individual councils within the fund.
It’s about pointing out the moral and financial arguments behind divestment, and both cases are strong. However, we might find that our council is not warm to the idea, in which case we will need to make it easier for them. As a first step, it may be easier to persuade them to divest from the dirtiest forms of energy, such as coal and tar sands. Partial divestment is a good start!Finally, we need to be shouting from the rooftops about the opportunities that clean energy investments represent for our futures.
If, like me, you think this sounds like the makings of a classic Birmingham Friends of the Earth campaign, please do get in touch and help us change the world!