TOOL: A Beginners Guide to Divestment

The global movement for fossil fuel divestment (sometimes also called disinvestment) is asking institutions to move their money out of oil, coal and gas companies for both moral and financial reasons. These institutions include universities, religious institutions, pension funds, local authorities and charitable foundations.

By Emma Howard - The Gaurdian

Divestment is the opposite of investment – it is the removal of your investment capital from stocks, bonds or funds. The global movement for fossil fuel divestment (sometimes also called disinvestment) is asking institutions to move their money out of oil, coal and gas companies for both moral and financial reasons. These institutions include universities, religious institutions, pension funds, local authorities and charitable foundations.

It is the fastest-growing divestment campaign in history and could cause significant damage to coal, gas and oil companies, according to a study by Oxford University. Previous divestment campaigns have targeted the tobacco and gambling industries and companies funding the violence in Darfur. Divestment is perhaps most well known for its role in the fight against apartheid in South Africa.

Almost all of the arguments in favour of fossil fuel divestment fit into two categories: moral and financial.

First, the moral argument, which is rooted in basic maths. Scientific research shows that in order to keep to international targets to limit global warming to a 2C rise and thus prevent catastrophic levels of climate change, between two-thirds and four-fifths of fossil fuels need to remain in the ground. But fossil fuel companies are currently banking on these targets not being met so are extracting these reserves and selling them – and are actively prospecting for more. In doing so they are setting the human race on a route to irreversible climate change that will cause rising seas, flooding, droughts, rising disease, increased conflicts and refugee crises. READ MORE

Photo: Shanghai at sunset, Photo Credit: Suicup