Global fossil fuel divestment movement surpasses $39trn as cities and faith groups make new pledges
More than 70 faith institutions and the cities of Glasgow, Paris, Copenhagen, Seattle, Auckland and Rio De Janeiro have committed to divest from fossil fuels, pushing the global amount of capital covered by such commitments to $39.2trn.
The cities announced their new divestment ambitions through C40 Cities’ Divest/Invest Forum today (26 October). This means that the Forum now convenes cities representing 50 million residents and $400bn in assets under management. Auckland claims that it has already divested from the fossil fuel sector, meaning that its commitment “creates a further impetus” for climate action.
Meanwhile, the 72 religious institutions made the joint commitment through the work of the campaign organisation Stand Earth. They collectively represent more than $4.2bn of assets under management, making the announcement the largest of its kind. Institutions making the pledge include the Catholic Bishops’ Conference of Scotland; the Central Finance Board of the Methodist Church in the UK; the Presbyterian Church of Wales; the Presbyterian Church in Ireland; Catholic universities in the United States and the UK; the Sisters of Charity of Australia; 15 Catholic dioceses in the UK; Caritas Nepal; two Church of England dioceses; 19 churches in the Greek Catholic Church in Ukraine; and the Buddhist religious movement Soka Gakkai International – UK.
For each city and faith group, deadlines for divestment from fossil fuels and re-investment in low-carbon projects will vary. It is hoped that the move will create a ripple effect, encouraging other organisations, including philanthropic foundations and higher education institutions, to follow suit.
The $39.2trn figure has been calculated by Stand Earth, which has been reporting on the divest-invest movement’s progress annually since 2014. This year’s report, published this week, states that the value of assets under management covered by public commitments has grown more than 75-fold within less than a decade.
“With this growth, divestment has proven successful at its core goal of helping to delegitimise fossil fuel companies as political players,” the report states. “While the remaining power of these companies should not be underestimated, it has clearly diminished.
“It’s not a blow the fossil fuel industry is well-positioned to absorb. This year has seen a short-term surge in oil prices and stock market gains, but over the last nine years, fossil fuel stocks have routinely underperformed the market. Institutional investors are focused on these long term trends.”
Indeed, many of the organisations making new commitments have cited financial reasons – as well as ethical reasons and increased climate legislation – as key drivers.
Glasgow’s City Treasurer Cllr Ricky Bell said: “Fossil fuels are already plummeting in popularity as investment propositions, Increasing sustainable investments is an effective way of not only protecting our assets from climate-related risks but also about creating jobs and opportunities in the green economy. We’re helping build that road to decarbonisation, forcing the big oil and gas firms to reform.”
Glasgow City Council notably published its draft plan for a Green New Deal earlier this month, outlining plans for a just transition to net-zero by 2030.
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