Fossil divestment movement gets backing from UNFCCC

The fossil fuel divestment campaign gained a new confirmation of support this week. UNFCCC spokesperson, Nick Nuttall, told the Guardian, “We support divestment as it sends a signal to companies, especially coal companies, that the age of ‘burn what you like, when you like’ cannot continue.”

In the lead up to the UN climate summit in Paris this December, the campaign to encourage investors to sell off fossil fuel assets is maintaining momentum as a strategy for institutions and individuals to put pressure on fossil fuels companies and tackle climate change.

 


The movement that began on US university campuses has gained the support of several high-levels officials as it has spread worldwide. UNFCCC Executive Secretariat Christiana Figueres addressed the issue at Brown Univerisity on April 16, 2014, encouraging academic institutions to reflect on their social responsibility and divest from fossil fuels. On November 4, 2014, UN Secretary General Ban Ki-moon called upon companies to shift investments in coal and fossil fuels to renewable energy sources. World Bank Group President Jim Yong Kim has also pointed out issues and risks associated with fossil fuel assets speaking at the the World Economic Forum in Davos in January:  “Sooner rather than later, [financial regulators]  must address the systemic risk associated with carbon-intensive activities in their economies, made clear, of course, by price signals. Start now by enforcing disclosure of climate risk and requiring companies and financial institutions to access their exposure to climate-related impacts.”

These calls, both from the bottom-up and top-down, are being met with action by some countries, cities, universities, churches, and individuals.

The divestment strategy seems to have started getting attention from fossil companies. In its annual report for 2014, oil giant Shell informed investors that new climate change regulations “may result in project delays and higher costs” and major oil producers need to find economically viable and publicly acceptable ways of cutting their climate-warming gas emissions, RTCC reported. “Continued and increased attention to climate change, including activities by non-governmental and political organisations, as well as more interest by the broader public, is likely to lead to additional regulations designed to reduce greenhouse gas emissions”, the report says.

The latest IPCC Assessment Report also highlights the role of redirecting investments in reaching mitigation goals. The report states that “substantial reductions in emissions would require large changes in investment patterns.”

Supporters claim that divestment from fossil fuel companies is smart, legal, and one of the few effective strategies available to take action on climate change without the support of national leaders.

However, not all are on board with divestment in fossil fuels. Those who oppose the idea instead argue that divestment is not actually addressing the problem of climate change. They worry that it provides only a symbolic value, which may become a substitute for truly effective action. Furthermore, opponents claim that natural gas is important in the transition away from coal, and that divestment might (if it were to reduce the financial resources of coal, oil, and gas companies, which they say it will not) lead to cutbacks on research and development of carbon capture and storage technologies and reduce the development of some renewable energy resources.

 

(Image: Rallying for divestment outside the New York Stock Exchange on Wall Street, New York City. Photo credit: Matthew Anderson/350.org on Flickr)