Climate deal Paris a success
The Paris Climate Agreement will change the world into a green era. Already, smart investors ignore the fossil industry.
They started to move because of the brutal pressure from activists 350.org and their divestment movement.
A portrait of the most successful climate campaign ever.
The historic climate agreement is a victory of reason and diplomacy. A rescue of the earth, or at least a chance for the world. It is the start of the end of the fossil era. Equally important but less often mentioned: this agreement is the most important investment advice of the century.
The shareholders of oil, gas and coal companies have received a clear signal: in the second half of this century, this planet will not have anything to do with the sectors in which you have invested your money in. Between 2050 and 2100 the world sets for zero emissions.
Any investment in fossil is risky
The agreement has implications for firms which act directly in fossil. Also a lot of sectors will have to change: Refineries, heavy industry (which produces mainly coal-generated power), the fossil transshipment ports, automotive, aviation, shipping, logistics and so on. “Any investment in fossil is risky,” said climate researcher Pier Vellinga in ‘De Telegraaf’.
It sounds perfectly logical and yet this story – fossil is increasingly worthless and therefore a risky investment – is less than five years old. Students, activists, and smart investors started to tell the story in 2010. Together they formed the divestment movement. Their name is not sexy, their campaign is.
We should be grateful to them, because without them, Paris would not have been such a success.
Lessons from an inflated mountain
In 2010, a group of students from the Swarthmore College, a small town near Philadelphia, traveled to West Virginia. They used their spring and autumn vacation to learn more about the impacts of coal mining in Appalachia.
Forests had been cut and peaks were inflated in order to win coal. The students were scared of what they saw: the destruction of nature, the bad health effects on local residents.
They wanted to do something, but which impact could they have?
The students thought about that question. By mid-October their strategy was ready. Their university was owner of shares in coal companies, they realized. Maybe they could ‘attack’ the coal industry via their college.
They started a campaign to convince the university administration to sell their fossil stocks – and made a public declaration on this issue. Good for the image of the university, bad for the industry. In time, it might help in undermining the fossil businesses.
The money that was taken from the fossil industry, could be reinvested in green healthy, energy technologies. A win-win situation.
The campaign was growing fast. In the spring of 2012, about fifty campuses started a divestment campaign. The fledgling movement was getting wings by a simple calculation: in 2011, financial analysts of the British think tank CarbonTracker Institute calculated how much CO2 would be released if all proven oil, gas and coal reserves would be powered. It appeared to be almost 2,800 megatons! Five times the amount of CO2 in the atmosphere comparing to 2010.
The implications of the new calculation were shocking: they showed that the fossil industry was destroying our stable climate. If governments act against it, business models would fall in the entire fossil sector.
From day one, the goal was to stigmatize the fossil sector. The students made investing in the fossil industry a moral issue. Just like previous divestment campaigns against the tobacco industry and the South Africa apartheid was done. They didn’t claim that withdrawing university funds from the fossil industry would end the fossil era. But the symbolic victories of the campaign would have consequences:
the campaign itself was a convenient way to tell the same story again and again: What the fossil industry does do with the Earth is risky and unfair!
Stop making profits in fossils
Nowadays, this story is so common that it sounds completely logical.
Paris, December 2nd 2015. The climate summit was in full swing. 350 has organized a press conference in a small room in the media center.
May Boeve: “The idea is simple: if it is wrong to cause climate change, then it is wrong to make a profit from the causers of climate change.”
3.4 trillion dollars
Boeve is executive director ‘350’: an international organization with a network of staff and volunteers in more than 180 countries. The press conference was held to announce the new record of the divestment campaign:
Already, more than 500 institutions have pledged to withdraw their money from the fossil industry and are making their stock portfolio fossil free. The invested capital is up to 3.4 trillion dollars, says Boeve.
In September, the number stopped at 2.6 billion. Since than, the largest insurance company on the planet (Allianz) promised to withdraw from fossils. And dozens of universities, pension funds, municipalities, asset managers and health institutions have promised a fossil fuel free ‘deal.
When Boeve was finished, she gave the micro to Stephen Heintz , president of the Rockefeller Brothers Fund, which manages 811 million dollars. Heintz was just as straight as Boeve was:
“The next twenty to thirty years, we must stop the entire fossil era,” he sayd. “Step by step, as soon as possible.”
In September 2014, the Rockefeller Fund was one of the first large investors who decided to go fossil-free. Ironically, because John D. Rockefeller earned his fortune in the oil industry. Heintz told the audience that there was no contradiction. He repeated what he told several years ago:
If John D. Rockefeller would have lived today, he would invest in green power. Not in the destructive fossil industry.
The press conference was illustrative of the triumph of the divestment campaign. Climate change is threatening and 350 is young, full of life and winning with a story that is so crystal clear is that it is hard to disagree. Leonardo DiCaprio, Natalie Portman, Thomas Piketty and Naomi Klein are supporting the campaign.
During the climate actions in Paris, thousands of ‘350’ people made their point
‘What do we want !? ” was chanted by a protester.
Climate justice !!! “the rest answered.
‘When do we want it !?’
‘Now !!! “
Not everyone believes in divestment. A ‘350’ students sit-in process at MIT has lasted fifty days! At Swarthmore University, students started a campaign in 2011. This campaign is still running because the chairman does not believe that the stigmatization of fossil fuels leads to lower CO2 emissions.
“Reducing the University CO2 footprint would work much better. And by stopping the fossil investments, the university would lose money,” the chairman reacted.
Is that right? Are fossils still lucrative for investors? Does the divestment campaign have a material effect on the industry that they are attacking, and thus the transition to sustainability and the reduction of CO2 emissions? Read more
- Are fossils lucrative for investors?
- Fossil industries waste $ 2.2 million investments
- ABP lost $ 9 billion investing in fossils
- Shell stopped drilling in the Arctic, this is why
- Lego ends Shell partnership
- BP pays record environmental fine of 18.7 billion for oil spill in 2010
- Shell will pay for cleaning up polluted Niger Delta
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