While there are many approaches to reducing our use of fossil fuels, outside of government regulation (eg: carbon pricing) divestment is really the only one that produces results. We know that to stave off the worst impacts of climate change we must keep temperatures within the 2 degree Celsius upper threshold limit. The only way we are going to do this is by radically reducing our consumption of fossil fuels. Investments that support the companies that are driving climate change are unethical and irresponsible. It is important to note that divesting from fossil fuels does not translate to lower returns. There are now a wide range of alternative investments that offer competitive rates of return.
Some well meaning individuals and organizations have advocated that we try to engage fossil fuel companies to encourage them to be more responsible. However, there is no evidence to support the effectiveness of such advocacy with fossil fuel companies. Shareholder advocacy with fossil fuel companies has been a dismal failure. It makes no sense to devote energy into a failed strategy.
Divestment exposes and pressures the industry in ways that engagement cannot. Even if shareholder advocacy worked, it typically takes years and we simply do not have that much time to begin radically reducing atmospheric carbon.
We have five time more carbon reserves than we can burn. To succeed in managing the climate crisis we must find ways to leave known fossil fuel reserves in the ground.
As exposed by leaked memos from Exxon the fossil fuel industry has known about climate change for decades and yet they have shown no inclination to do anything about it.
In fact, in the last decade, many oil and gas companies have sold their wind and solar operations and have used shareholder dollars to fund high cost and environmentally destructive extraction such as Tar Sands and offshore oil drilling.
Unfortunately, the industry’s history is defined by this kind of short-sighted activity – by funding climate deniers, shirking responsibility for global warming and now opposing carbon emissions rules for coal plants.
Now is the time to move our money away from fossil fuels and into companies that are working to build a livable future.
