Much like the apartheid movement that preceded it, the fossil fuel divestment campaign started several years ago on college campuses and has quickly spread to foundations, faith groups, and institutional investors. The focus of Divest-Invest is to influence people, groups and institutions to sell their fossil fuel stocks and bonds and invest in renewable energies and other climate solutions.
Focusing on the top 200 oil, gas and coal companies, the Divest-Invest movement has already seen impressive results, with over 180 institutions and 600 leaders pledging to divest more than $50 billion in assets from fossil fuel companies. It’s only a matter of time before others follow the lead of Divest-Invest early advocates. SVN member Tom Van Dyck, founder of As You Sow Foundation, has been actively involved in Divest-Invest since its launch.
His passion for the movement goes back to the 80s when he leveraged his financial acumen to fight apartheid. “We believe in using the capital markets to create social change and gain return for clients simultaneously,” Tom says. “90 companies are responsible for 65% of carbon dioxide in the air today,” he explains, adding that politicians should be placing regulations and a price on carbon. But this isn’t just an environmental issue.
As Divest-Invest signatory Desmond Tutu explains, “Climate change has thus become the human rights challenge of our time.” It is responsible for many of the challenges that the impoverished face, including loss of life, lack of fresh water, the spread of disease and rising food prices. Divest-Invest signatories are joining from all walks of life, including foundations, business leaders, academic institutions and faith groups.
Individual pledge-makers are asked to take three steps: Make no new investments in the top 200 oil, gas and coal companies; sell existing assets tied to those oil, gas, and coal investments within five years; and invest in a sustainable, equitable and renewable energy economy.
It’s about small steps and doing what you can with what you have. Just ask SVN members Timothy and Rose Yee of Green Retirement, which focuses on the 401k market. Helping clients create socially responsible retirement plans is the couple’s primary concern so when they heard about Divest-Invest, they immediately got involved.
Ensuring retirement plans align with client values and avoid fossil fuels is a moral imperative, they say. And it’s a financial necessity, too. For those who wonder if a fossil-fuel free portfolio is less competitive without it, Rose says, “We have five times more inventory of oil, coal and gas than the earth can burn and still survive,” explaining that holding onto stocks that are overvalued can result in stranded asset risk.