divestment

By Garrett Leahy - 48 Hills, August 29, 2021

More than 500 Bay Area high school students gathered outside the San Francisco Federal Building on 7^th Street Friday before marching down Market Street to City Hall, calling on the California State Teachers’ Retirement System, the state’s pension fund for California public school teachers, to divest its investment holdings in fossil fuel companies.

They pointed out that that California’s wildfires demonstrate the need to reduce emissions.

“This climate strike has been going on for years, but we’re feeling the effects of climate change,” said Anya Draves, a senior at Berkeley High School and President and Co-Founder of the Berkeley High Zero Waste Club. “With the wildfires, the red skies, the smoke…we’re the ones who are going to be living on this earth for years to come we have the energy and the voices to fight back.”

Draves was not alone in her concern about the future of the planet as the brunt of the effects of climate change begin to unfold.

Aniya Butler, a Sophomore at Oakland Charter High School and Hip Hop and Climate Justice Coordinator with Youth vs Apocaylpse, a youth-led group calling on governments and corporations to take dramatic action against climate change, expressed the importance for student action to pressure CalSTRS to divest from fossil fuel companies, saying that following reports that effects of climate change now may be, in part, irreversible, young people must put pressure on corporations, hedge funds, and other wealthy and powerful entities to invest in sustainable industries.

“After the IPCC report came out, I feel like people are opening their eyes, like ‘okay’ this crisis is real and now we have to do something about it,” said Butler. “The youth are the future, and the climate crisis is something that will affect our future. We have to recognize that if we want to live in a future where we can thrive, where we can breathe, we are going to have to be the ones out here organizing actions, calling out the government, and calling on these corporations to divest from destruction and invest in our future.”

By Marcy Winograd - Common Dreams, August 26, 2021

The kids are mad as hell—and so are teachers who want their California teacher pension fund, CalSTRS, to join 1,000 other institutions collectively divesting $14.5 trillion from the fossil fuel industry that threatens climate catastrophe. The retirement fund divestment fight, led by retired teachers in Fossil Free CA and students from Youth vs Apocalypse and Earth Guardians, estimates CalSTRS' portfolio investments in fossil fuels at $16 billion, mostly in oil and gas delivery systems, but $6 billion in direct investments in oil behemoths, with $400 million in Exxon-Mobil, $350 million in Chevron, $250 million in BP and $108 million in Enbridge Inc. This is the same corporation sending attack dogs to maul water protectors protesting drilling at river crossings on indigenous land, where Enbridge's Line 3 pipeline will send sludgy tar sands through Minnesota. The estimated pollution from the pipeline is equivalent to 50 coal powered plants running for 50 years.

Fossil Free CA and other divestment advocates, including this author, warn that CalSTRS, the nation's second largest pension fund with a $310 billion dollar portfolio, just behind CalPERS' $444 billion in holdings, risks sticking its members, over 700-thousand active and retired California teachers, with stranded assets—unless the pension fund moves the money before it's too late, too late for the portfolio, too late for the planet.

CalSTRS's resistance to divestment from Big Oil comes at a financial cost to rank and file public school teachers. In 2019, the Corporate Knights, a Toronto-based research firm, published a study showing that had CalSTRS divested during the last decade the teacher retirement fund would have generated an additional $5.5 billion. Forbes reports that during that same decade, the energy sector of big fossil fuel companies, such as Exxon (ejected from the Dow in 2020), Chevron and BP, shrunk to the smallest investment sector in Standard and Poor's (S & P) index of the 500 largest US publicly traded companies. This year oil companies underperforming the index saw their credit ratings cut in half.

By Saurav Sarkar - Labor Notes, June 3, 2021

Not long ago, workers at the Environmental Protection Agency were battling the Trump Administration’s many attempts to interfere with both their agency’s mission and their rights on the job.

Under Trump, the EPA reduced union officials’ official time, restricted the ability to bring grievances, and took away office, meeting, and storage space. Now, with most of those changes undone and the Trump era behind them, EPA workers have begun to work towards a different goal: divesting their federal retirement investment program—the world’s largest defined-contribution plan—from fossil fuel stocks.

“For EPA employees, this is something that is near and dear to our hearts,” said Nicole Cantello, an EPA lawyer and president of Government Employees (AFGE) Local 704.

EPA workers issue and enforce regulations, make grants, conduct research and education, and provide technical assistance for environmental cleanup. They’re probably more aware than most workers of the urgency of the climate crisis, given that they collect greenhouse gas data, regulate vehicle emissions, and educate the public about the issue.

Even limiting global warming to 1.5 degrees Celsius above pre-industrial levels—the goal of the 2015 Paris Climate Agreement—will result, according to a landmark 2018 U.N. report, in heat waves, more droughts, more intense hurricanes and flooding, a rise in sea levels, harm to ecosystems, lower food crop yields, deforestation, and other damaging consequences.

An increase of 2 degrees or more will have far more devastating effects.

So it’s no wonder EPA workers aren’t happy, about, as Cantello put it, “being forced to invest in instruments that have fossil fuels and [greenhouse gas] emissions that are attached them.”

By Elizabeth Perry - Work and Climate Change Report, May 27, 2021

May 26 will go down in history as a very bad day for the fossil fuel industry for three reasons: in the Netherlands, the courts issued a landmark decision that requires Royal Dutch Shell to cut its carbon emissions – including Scope 3 emissions – by 45% by 2030. Also on May 26, activist shareholders won separate victories at the corporate annual meetings of ExxonMobil and Chevron. Bill McKibben reflects on all three events in “Big Oil’s Bad Bad Day” in The New Yorker , and Jamie Henn wrote “A Landmark Day in the fight against fossil fuels” in Fossil Free Media.

The case of Royal Dutch Shell is summarized by Friends of the Earth Canada in their press release , which also links to an English-language version of the Court’s decision.

“On May 26, as a result of legal action brought by Friends of the Earth Netherlands (Milieudefensie) together with 17,000 co-plaintiffs and six other organisations the court in The Hague ruled that Shell must reduce its CO2 emissions by 45% within 10 years.

…..“This is a turning point in history. This case is unique because it is the first time a judge has ordered a large polluting company to comply with the Paris Climate Agreement. This ruling may also have major consequences for other big polluters,” says Roger Cox, lawyer for Friends of the Earth Netherlands.

The verdict requires Royal Dutch Shell to reduce its emissions by 45% by the end of 2030. Shell is also responsible for emission from customers and suppliers. There is a threat of human rights violations to the “right to life” and “undisturbed family life”.

German news organization Deutsche Welle offers an excellent, more thorough discussion in “Shell ordered to reduce CO2 emissions in watershed ruling”, which points out that the case was argued on human rights grounds – much like the precedent-setting Urgenda case and the recent German constitutional case. In those cases however, governments were called upon to defend the human right to a future safe from the dangers of climate change. The Shell case is the first time such an argument has been tried against a corporation – and is seen as a harbinger of future legal action.

By Movement For Black Lives - YouTube Video, May 11, 2021

M4BL's Red, Black & Green New Deal Initiative hosts the first ever National Black Climate Summit to discuss our plans to combat Climate and Environmental Injustice! Hear from leaders in the Black climate justice movement and from our team on what’s coming up for our Black Climate Agenda!

By staff - Labor Network for Sustainability, May 2021

Members of Rutgers American Association of University Professors – American Federation of Teachers (AAUP-AFT) are joining with student allies in celebrating a vote to divest from fossil fuels by the Rutgers Board of Governors and Board of Trustees.

The decision, set in motion last year by a formal request from a broad student coalition, backed by Rutgers unions, will commit the university to cutting financial connections to any company or investment fund whose primary business is in oil, coal, or natural gas, from exploration and extraction to pipelines and transportation.

Divestment is the culmination of years of efforts by students, faculty, and staff to get Rutgers to take concrete action toward the goal of climate justice, said David Hughes, past president and current treasurer of Rutgers AAUP-AFT, the union representing full-time faculty and graduate workers. “This is seven-and-a-half years in the making,” Hughes said, “and it will give greater strength to the divestment movement at exactly the moment when the new Biden administration is beginning to take up climate change.”

American Federation of Teachers President Randi Weingarten also highlighted the years of organizing. “The university community at Rutgers has shown that when people come together around an issue like climate sustainability, change is possible,” Weingarten said. “Hopefully the work Rutgers is doing on fossil fuel divestment will set a standard for other institutions. For our universities to truly become institutions of climate mitigation and resiliency, we must also invest in solarizing buildings and other measures that generate clean energy.”

By the CFA Peace and Justice Committee - California Faculty Association, April 11, 2021

WHEREAS, climate change, through rising sea levels, drought, heat waves, and increased wildfires is already negatively affecting human wellbeing, ecosystems and biodiversity; and WHEREAS, climate change is an issue of environmental justice, disproportionately impacting Indigenous communities, communities of color, and low income communities due to historical oppression, inequity of power, and lack of access to resources for prevention and relief; and

WHEREAS, the California Faculty Association has committed itself to fighting forces of institutional racism, promoting anti-racist and social justice principles and practices; and

WHEREAS, the International Panel on Climate Change concluded in 2018 that we have 12 years to make dramatic cuts in the use of fossil fuels (coal, oil, gas and tar sands) if we are to keep warming to 1.5o C and avoid more catastrophic change; and

WHEREAS, to effectively address climate change most fossil fuel reserves must remain in the ground, never to be used. This makes fossil fuel stocks a risky investment; and

WHEREAS, an analysis by Corporate Knights, found that the CalPERS pension fund lost 11.9 billion dollars over the last ten years by holding fossil fuel stocks; and

WHEREAS, divestment in specific segments or business operations by CalPERS is already standard practice and is specifically allowed by the California Constitution; and

WHEREAS, the fossil fuel industry is the single most powerful obstacle to addressing climate change; and

WHEREAS, an Oxford University study of divestment movements concerning South African apartheid, tobacco, and Darfur found that they had all succeeded in weakening the political power of their target, and had won government action; and

WHEREAS, globally over 170 colleges and universities have divested their endowments from fossil fuels including the University of California system, three CSU campuses, Stanford, and USC; and

WHEREAS, many California education unions have already passed resolutions calling for fossil fuel divestment from their state pensions, including the California Federation of Teachers, the Faculty Association of the California Community Colleges, and many California Teacher Association chapters; and

WHEREAS, a fossil fuel company is defined here as a company on the Carbon Underground 200 list of the top 100 public coal companies and the top 100 public oil and gas companies globally; and

WHEREAS, divestment means selling directly held or commingled assets including fossil fuel public equities and corporate bonds; therefore be it

RESOLVED, that the California Faculty Association strongly urges CalPERS to fully divest from fossil fuel companies, by selling their current investments and refraining from making any new investments in fossil fuel companies. A copy of this resolution shall be sent to CalPERS Board members.

By Elizabeth Perry - Work and Climate Change Report, March 18, 2021

Chasing Carbon Unicorns: The Deception of Carbon Markets and

Divesting to protect our pensions and the planet: An analysis of local government investments in coal, oil and gas was released in February by Platform, Friends of the Earth Scotland and Friends of the Earth England Wales and Northern Ireland.

The report details the extent of fossil fuel investment by local governments in the U.K., and their progress in divestment. However, of broader interest, it summarizes the financial status of the declining fossil fuel industry, explains the process which lead to stranded assets, and describes the financial dangers for all pension funds in quite understandable terms: “pension funds exposed to the fossil fuel system in the coming decade will face a rollercoaster ride of disruption, write-downs, financial instability and share price deratings as markets adjust.” In an explanation very relevant to Canadians, whose own Canadian Pension Plan Investment Board still clings to the “staying invested and ‘engaging’” approach – the report uses the example of investing in Blockbuster videos vs. Netflix, to debunk the “engagement” approach: “The argument for ‘engagement’ tends to be one made by asset owners who employ investment managers who won’t or can’t accept that there is a technology-driven transition occurring. …. this approach of ‘we’ll decarbonise when markets decide to decarbonise’ is clearly not a risk management strategy. It is a ‘do nothing, and hope a few meetings will help’ strategy.”

Divesting to protect our pensions and the planet offers practical steps for local councillors, community members, and labour unionists. For unions, it points to the leadership of the Trades Union Congress (TUC), which passed a climate action motion in 2017 which included support for divestment, based on a motion by their constituent unions representing food workers, communication workers, fire brigades, train drivers, and other transport workers. Unison, the primary union representing U.K. government workers, also passed a strong divestment motion in 2017 – meaningful because in the U.K., union members in government workplaces are usually entitled to some form of representation on their pension fund committee and board. The report urges union members to become knowledgeable about financial issues and to speak up in committee meetings – advocating for divestment and re-investment in lower-carbon, socially just funds which benefit their local communities and economies, especially after Covid. The report cites inspiring examples, such as investment in wind farms by Manchester and London Councils, the U.K.’s first community-owned solar power cooperative by Lancashire County Council, and social housing in the Forth Valley and in London Councils.

An earlier guide for unions was Our Pensions, Our Communities, Our Planet: How to reinvest our pensions for our good? published by the Trade Union Group within Campaign against Climate Change. The 6-page, action-oriented fact sheet lacks all the up-to-date statistical detail in Divesting to protect our pensions and the planet but makes many of the same arguments for divestment, and includes links to U.K. resources, as well as a model motion for local unions.

By Staff - Fossil Free California, March 11, 2021

California Public Employees Retirement System still holds $8.5 million in thermal coal producers in violation of SB 185, a 2015 state law on thermal coal divestment. This act requires CalPERS to divest from companies that earn the majority of their revenue from thermal coal production.

When the fund divested from several coal companies in 2017, it stayed invested in three thermal coal companies that met the criteria—Exxaro, Adaro, and Banpu—because “they had indicated plans to transition their business models to adapt to clean energy generation (such as through a decrease in reliance on thermal coal mining as a revenue source).”

However, four years later, all three of these companies continue to make well over 50% of their revenue from thermal coal (according to data from the Global Coal Exit List at coalexit.org) and show few signs of transitioning their business models. In fact, all of these companies have documented expansion plans for their coal operations. Although South Africa-based Exxaro Resources recently announced that it will not acquire more thermal coal assets, it already owns more than 31 billion tons of recoverable coal, which is more than enough to create a “tipping point” for Earth’s climate.

All three coal companies have demonstrated contempt for the lives of communities displaced or impacted by their mining operations. Exxaro, in South Africa, displaces communities from mining sites in violation of the South African Constitution and with insignificant compensation leaving many communities to struggle to even find necessities like food while their air and water is irreparably poisoned.

Similarly, Adaro, an Indonesian company, strip mines forested land and continues to displace native people, threatening their lives and cultures. Adaro was also responsible for the deaths of 24 children working in mines and continues polluting surrounding areas such that water becomes undrinkable, and farmers have to abandon their land. Finally, Banpu, a Thai company, builds mines across Asia. They use open ponds to collect pollutants which inevitably enter the ground water and destroy crops. Farmers in Thailand reported being forcibly bought out and eventually forced to move because the added cost of purchasing clean water combined with the destruction of their livelihood was too much.

Join Fossil Free California and allies to call on CalPERS to finish its mandated thermal coal divestment by immediately adding Exxaro, Adaro, and Banpu to the thermal coal exclusion list.

Send Letter to CalPERS

By Elizabeth Perry - Work and Climate Change Report, February 22, 2021

With the goal to leverage their collective financial clout, Canadian university endowment funds and pension plans launched the University Network for Investor Engagement (UNIE) on February 18. Working through SHARE, Canada’s leading not-for-profit in responsible investment services, “The UNIE initiative will focus on key sectors where advocacy can make the biggest difference, including finance, transportation, energy and utilities, and manufacturing, focusing both on reducing greenhouse gas emissions and accelerating the transition to a low carbon economy.” Initial participants include Carleton University, Concordia University, McGill University, McMaster University, Mount Alison University, Université de Montreal, University of St. Michael’s College, University of Toronto Asset Management, University of Victoria, and York University.

This development follows on a number of statements and initiatives by Canadian pension administrators – most of which reflect this general strategy to prefer engagement as shareholders over divestment from fossil fuel holdings. Some examples:

In November 2020, the CEOs of Canada’s eight major pension administrators, with approximately $1.6 trillion in assets under management, issued a press release announcing their joint position statement, Companies and investors must put sustainability and inclusive growth at the centre of economic recovery. The text calls on companies to provide consistent and complete environmental, social, and governance (ESG) information, and continues: “For our part, we continue to strengthen our own ESG disclosure and integration practices, and allocate capital to investments best placed to deliver long-term sustainable value creation.” The signatories included: AIMCo, BCI, Caisse de dépôt et placement du Québec, CPP Investments, HOOPP, OMERS, Ontario Teachers’ Pension Plan, and PSP Investments.

“Why are Ontario pensioners investing in future Alberta stranded assets?” (in Corporate Knights, December 16, 2020) describes investment by OP Trust (which holds the pension funds of Ontario civil servants, teachers and healthcare workers) in a natural gas electricity-generation plant in Alberta. The authors summarize the growing global realization that fossil fuel investments are financially risky and conclude, “The people at OPTrust have begun to recognize this. They’ve created multiple reports, with pretty graphs and rosy statements about supporting the Paris Agreement. But this statement rings out: “Emission reduction targets are not today’s objective.” Like many other organizations, they are unwilling to walk the talk.”