350.org’s Fossil Fuel Divestment Campaign, launched during Bill McKibben’s Do the Math Tour last fall, asks institutions to pull investments from the “publicly-traded companies hold(ing) the vast majority of the world’s proven coal, oil and gas reserves.”
Click on the US map image on the right to find out how to start such a campaign.
John Fullerton, former JPMorgan Managing Director, and founder and president of the The Capital Institute, discusses fossil fuel divestment and the carbon asset bubble with Laura Flanders on an episode of her show in late 2013. Click on the image to see the show.
The effectiveness of such a campaign is being debated within the Unitarian Universalist (UU) community.
Tim Brennan, Treasurer and Chief Financial Officer, Unitarian Universalist Association, voices his opinion in a February 26, 2013, Huffington Post entry: “Is Divestment the Only Solution to Climate Catastrophe?”
In reply, Toby Sackton, UU member from Massachusetts, submits this “Open Letter to Tim Brennan re Divestment from fossil fuels …written in the spirit of encouraging discussion of the divestment issue in a respectful manner, while disagreeing with Tim’s disparagement of divestment.
Thank you for taking the time to write about fossil fuel divestment. As Treasurer and Chief Financial Officer of the UUA, you have born the brunt of the growing activism among UU congregations who favor divestment from fossil fuels.
As an investment professional, this must be disconcerting. I would like to explain why divestment should be considered as well as shareholder activism.
Shareholder activism has been beneficial, as you say, and you have some results to show.
But the victories you claim for fossil fuels – increase in fuel economy; pulling support from climate science deniers, disclosure of greenhouse emissions, and mandated disclosure of climate risk by the SEC- are all ‘political’ victories. They did not happen in a vacuum, but happened as companies bowed to public pressure and government action.
Shareholder activism was only one of many reasons these positive changes came about.
The key mistake you make in dismissing divestment as a strategy is this: You equate individual consumers and investors with the fossil fuel companies, as if we are all part of the problem together.
You say “it is satisfying to target the fossil fuel companies as the embodiment of evil. But those companies are only responding to demand from their customers–us.”
“The truth is, there is a simple way to really hurt the fossil fuel companies and it’s not divesting–it’s boycotting their products. And that is the real heart of the problem. Fossil fuels infuse our entire economy, the financial markets, and our lives. If you think your portfolio should be fossil fuel free, shouldn’t your life be too?”
In our view it is precisely because fossil fuels infuse our entire economy that it is imperative we choose collective political action to make a change.
Our current policies were built to support and protect fossil fuels – it is the focus of our tax code, our military, our accounting laws, our land management. It will take a collective political movement to change all of that – not individuals who say they will buy only green energy. Divestment is a powerful statement to galvanize this movement precisely
because it says we will not accept the status quo.
The fossil fuel companies and governments already own carbon reserves five times greater than the maximum amount of carbon we can burn and not destroy our biosphere.
By demanding divestment, we are similar to the 19th century abolitionists. They also lived in an economic and social milieu defined by the evil of slavery in their midst. The Northern mills prospered upon cheap southern cotton. Yet the abolitionists did not call for boycotts of manufactured clothing. They demanded an end to slavery on moral grounds.
We do not want to reform the oil and coal companies. Their business model – the most profitable in the entire capitalist world – directly depends on destroying the biosphere. They do not value reserves except that they can be burned at a later date.
That business model cannot exist if we are to prevent global catastrophe.
We need to halt all drilling and exploration for fossil fuels. We already have access to five times more known reserves than we can safely use. Yet the oil companies continue to spend billions searching for new fossil fuel sources.
We want to reconfigure public investments and incentives in an emergency drive to create non-fossil energy sources, and pay for this with taxes on oil company profits and carbon fuels. And as you say, you agree with this.
Divestment is a moral call to stop this madness. Abandoning fossil fuels will only happen once there is a sufficient recognition that oil companies do not have the moral right to operate if their business furthers the destruction of our planet’s biosphere.
The purpose of divestment is not to affect the behavior of the oil companies. It is to affect behavior of all of us – to build a recognition that exploitation of carbon fuels is not a legitimate business, and must be stamped out.
The mechanisms for this include much of what you support: carbon taxes, payments of the full costs of carbon extraction, and limits on emissions and support for alternative energy.
But these actions will never happen to the necessary extent until we come to a society-wide recognition that carbon fuel companies cannot be allowed to continue business as usual. They must be corralled, constrained, controlled, and then eliminated as we make a transition to a sustainable energy system.
We don’t want to convince Exxon. We want to stop Exxon from operating as a large and successful company unless they abandon all fossil fuel activity.
In our generation we have about 20 years to fight this battle. And our abolitionist forefathers and mothers in the Congregational churches should be proud that today the UUA has accepted this historic moral challenge.
We hope you will join us in our moral outrage – as recognize that public divestment from fossil fuels is indeed a first step to further action.
The debate on the effectiveness of Fossil Fuel Divestiture to control climate change continues here: