01.27.14 – World leaders weigh in on fossil fuel divestment
Pull your money out of high carbon assets, urge World Bank President, UN Climate Chief and UN Secretary General. The fossil fuel divestment movement just took a big step forward, and onto the world stage.
Twelve days ago, at the 2014 Investor Summit on Climate Risk at the UN headquarters in New York, UN climate chief, Christiana Figueres, said that institutional investors would be in blatant breach of their fiduciary duty if they ignored the “clear scientific evidence”1.
“Climate change increasingly poses one of the biggest long-term threats to those investments and the wealth of the global economy…Institutional investors who ignore the risk face being increasingly seen as blatantly in breach of their fiduciary duty to their beneficial owners…”, noted the Executive Secretary of the United Nations Framework Convention on Climate Change (UNFCCC).
“Through policy reforms, we can divest and tax that which we don’t want, the carbon that threatens development gains over the last 20 years.”
At a joint press conference, held with UN secretary-general, Ban Ki-moon, and the president of the European commission, José Manuel Barroso, Kim told members of the press4 , “This is the year to take action on climate change. There are no excuses.”
Although Ban Ki-Moon did not explicitly name divestment, he pointed to financiers’ responsibility to move their money away from fossil fuel assets and take the lead in creating the low-carbon economy5:
“We need in particular to win over institutional investors that collectively manage more than 70 trillion Euros of assets. The bulk of these investments are high-carbon assets. These investors have the power – and I believe the responsibility — to help transform the global economy.”
Christiana Figueres pointed to the need for institutional investments to be aligned with scientific consensus, and at Fossil Free MIT we couldn’t agree more. What better place than MIT – a global powerhouse of climate science and renewable energy technologies – for that to first happen in a big way?
“Investment decisions need to reflect the clear scientific evidence, and fiduciary responsibility needs to grasp the intergenerational reality: namely that unchecked climate change has the potential to impact and eventually devastate the lives, livelihoods and savings of many, now and well into the future…”
The press release from the UNFCCC, Safeguarding Future Retirement Funds – Time for Investors to Move Out of High-Carbon Assets6, outlines a key first step “…for asset owners and managers to request that all companies within their portfolios end the practice of spending shareholder funds on opposing government clean energy policies and action nationally and globally on climate change.” MIT, will you take this step with us?
Fossil Free MIT asked Christiana Figueres in September 2013 whether it was right for scientific leaders like MIT and Harvard to also be investing in the fossil fuel industry, and she indicated her support for the divestment campaign.
Ms. Figueres was speaking at the 2014 Investor Summit on Climate Risk at UN headquarters, attended by hundreds of financial, corporate and investment leaders with more than $20 trillion in combined assets. The Summit is co-organized by Boston-based CERES – a coalition and network of over 130 pension funds, investors and non-profit organizations. Fossil Free MIT was delighted to host CERES Director of Public Policy, Anne Kelly, at our Discussion on Divestment panel before Christmas.References
- McGrath, M. Get your cash out of fossil fuel backed funds says UN climate chief. BBC News (January 2014). [link] [↩]
- (World Bank Group President Jim Yong Kim, Press Conference at the World Economic Forum, Davos (January 2014). [link] [↩]
- King, E. World Bank chief backs fossil fuel divestment drive. rtcc.org [link] [↩]
- World Bank Group President Jim Yong Kim, Press Conference at the World Economic Forum, Davos (January 2014). [link] [↩]
- United Nations Secretary-General, World Economic Forum, Davos (January 2014). [link] [↩]
- United Nations Climate Change Secretariat, Press Release. Safeguarding Future Retirement Funds – Time for Investors to Move Out of High-Carbon Assets (January 2014). [link] [↩]