September 11, 2018 Read More →

Report: Divestment campaigns gaining steam

The Guardian:

The funds committed to fossil fuel divestment now total more than $6tn (£4.6tn), with almost 1,000 institutional investors having made the pledge, according to a new report.

The sell-off of coal, oil and gas investments is led by the insurance industry, with $3tn of funds. But it also now includes the first nation to divest, Ireland, major cities including New York and key medical organisations. Major oil companies such as Shell have this year cited divestment as a material risk to its business.

Fossil fuel divestment began on US university campuses in 2011 but now spans 37 nations around the world. Supporters of divestment say existing fossil fuel resources are already far greater than can be burned without causing catastrophic climate change and that exploring for and producing more fossil fuels is therefore morally wrong. They also say fossil fuel companies are risky investments as global action on emissions gets tougher.

The new divestment report, by Arabella Advisors, calculates that investors with $6.2tn in assets under management have committed to divest from fossil fuels, up from $5.2tn in the previous report in 2016.

Jeremy Grantham, co-founder of GMO, one of the world’s most influential asset management companies, said the financial case for divestment was compelling. “Investors with long-term horizons should avoid oil stocks on investment grounds. They face a sustained headwind. Ethical arguments for divestments are simply not necessary. They are a pure bonus,” he said.

Another new report, from Genus Capital Management in Canada, said its fossil free fund had outperformed a benchmark of standard stock market indices by almost 2% per year over the last five years. The company’s Fossil Free CanGlobe Equity Fund is a mix of Canadian and global stocks. “At the five-year mark, we can conclusively say: divesting from fossil fuels pays,” said CEO Wayne Wachell.

More: Fossil fuel divestment funds rise to $6tn

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