Momentum behind the fossil fuel divestment movement has continued to gather as 2015 gets rolling, with Sydney’s Marrickville Council becoming the first council in NSW to move away from dirty investments. Pushed by Greens councillor Max Phillips and 350.org, the Council’s nine to two vote will see around $15 million invested in non-fossil-fuel exposed banks ($11m of which is already in fossil-free investments) with more to come. The move follows similar divestment actions from Moreland Council in Melbourne and Fremantle Council in Western Australia, and comes as pressure increases on Universities to also cut their exposure to fossil assets. Currently only three universities in Australia – Charles Sturt University, the University of Sydney and the Australian National University – could be rated for risk exposure to fossil fuels, and while there have been some positive developments, they have been rated poorly. The Asset Owners Disclosure Project’s (AODP) 2014-15 Global Universities Index paints a catastrophic picture of inaction by universities globally, with 98 per cent of the 278 institutions invited to participate receiving a D rating for management and transparency. Worse still, the AODP confirmed that Australia’s top Group of Eight universities initially plotted to avoid scrutiny of their climate change risk management, with Monash University’s Chief Financial Officer indicating in March, 2014, that the group would ignore the AODP’s request and feign ignorance when questioned about the results. Both Sydney and ANU later made divestment moves after pressure from students and staff.
- MT @AODProject: 98% of Unis doing little to nothing to mitigate #climate risk #uniclimateindex http://t.co/zYu3jGQJ6K http://t.co/grak72Hxnc
- More and more institutional investors are realising that fossil fuel divestment is both a moral and a financial imperative as climate change begins to bite. With the world moving to address greenhouse gas emissions and transition to a clean economy, a “sub-clime” crisis is looming. Early movers on fossil fuel divestment are protecting themselves, not just making the right moral and ethical stand.
- Universities have an ethical duty to ensure they are not investing in the very problems they are researching solutions for, yet right now most Australian universities are failing dismally on this front. By continuing to invest in fossil fuel stocks or not allowing their investments to be properly scrutinised, universities are risking both their ethical integrity and their future financial health.
- Investors ignore the carbon bubble and the volatility of fossil fuel stocks at their peril. Despite being relentlessly bullied by financial press and the government over its decision to divest from fossil fuel stocks, the Australian National University’s move to dump shares in companies such as gas heavyweight Santos was proven to be savvy, as soon after its announcement Santo’s shares collapsed.
- Marrickville joins divestment bandwagon (The Fifth Estate)
- Marrickville Council shuns big four banks for fossil-free firms (The Australian)
Tools and resources
- Report: The 2014-15 Global Universities Index (AODP)
- PR: Pioneering index shows Australian universities have far to go on climate investment risk (The Climate Institute)
- Report: Climate Smart Super: Understanding Superannuation & Climate Risk (The Climate Institute)
- Report: Climate proofing your finances (The Australia Institute / Market Forces)
- Report: Responsible Investment Benchmark Report (RIAA)
Images and video
- Video: Monash letters reveal secretive attitude over fossil fuel investments (ABC Lateline)
- Image: University of Sydney (Andrea Shaffer)
- “Marrickville Council has a strong commitment to combating climate change, with programs aimed at cutting emissions. By adopting this motion we will prefer financial institutions that avoid funding fossil fuels, such as coal ports on the Great Barrier Reef, or coal seam gas projects in Camden. The divestment movement supported by 350.org and Market Forces is growing extremely quickly and has the big polluters worried.” Marrickville Greens Councillor Max Phillips.
- “It is shocking that universities – thought to be at the cutting edge of innovation and problem-solving – cannot grasp the simple mathematics of wasted capital and the need for more transparency in investing, not less. Universities use their investment returns to fund medium to long-term development programs, as well as shorter term bursaries. Given the current standoff in higher education funding, the management of climate change risk is critical to ensuring the fiscal health of Australia’s universities through the inevitable sub-clime crisis.” AODP Chair, Dr John Hewson.
- “It is disappointing that the lessons of the sub-prime mortgage crisis have not been learnt by Australia’s universities; it is clear that mandatory reporting of systemic risks such as climate change must be required by Commonwealth and State governments to ensure that taxpayers’ money is not wasted. Australian universities placed well behind their counterparts in the US and the UK. In general, Australian universities performed far worse than the average pension fund. This was particularly disappointing given that many of the world’s leading pension funds on climate change risk are Australian.” AODP Chief Executive Officer, Julian Poulter.
- “It’s unacceptable that the university sector, which plays a leading role in advancing our economy and society, is so far behind on this critical investment issue. Many Australian universities are pioneers in climate change research, so these institutions should be well aware of the unique risks to investments posed by the potential impacts of climate change itself, and the regulations that will inevitably ramp up to stave off those impacts.” CEO of The Climate Institute, John Connor.
Related Tree Alerts
- Fossil fuel divestment gathers pace as Local Government Super abandons coal
- Medical experts back divestment to benefit climate and health
- Fossil free index outperforms the S&P 500
- Glasgow University becomes first in Europe to divest from fossil fuels
- MT @Agent350: Asset Owners Disclosure Project: “catastrophic picture of inaction” on climate risk at universities: http://t.co/OsvyaRNzN5
- RT @MvilleGreens: Marrickville Council shuns big four banks for fossil-free firms http://t.co/1mViZwXhIU