Ireland's vote to get rid of fossil fuels in a global climate campaign

Ireland is fast becoming the first country to completely surrender all public funds of fossil fuel companies after a key vote in its parliament on Thursday. It is an important step in an international campaign led by environmental organizations to cut the flow of money from investors to oil, gas and oil companies.

In the past six years, the world divestment campaign to cut ties with the fossil fuel industry.

According to the 350.org activist group, nearly 900 institutions worldwide representing more than $ 6 trillion worth of assets have so far committed to some level of divestment.

But the campaign also highlighted a conflict between two different approaches. changes in the name of climate protection: those who believe that total disinvestment is the only option, and activist investors who believe that they can convince companies to change policies by working from within as shareholders having an interest and a voice. The Irish fossil fuel divestment project is yet to go before the upper chamber of parliament, but that should be done without difficulty, said Lindsay Meiman, a spokesperson for 350.org.

"It's a tremendous boost," said Bill McKibben, co-founder of 350.org, who helped lead the divestment movement. "When we started the disinvestment campaign there are six years, the thought that we would reach the stage where entire nation-states were disinvesting had not even begun to bother me. "

Disinvestment is a variety of flavors

Ireland is the last in a series of major disinvestment announcements that exert varying pressures on the industry.

The Irish plan, designed to help the country meet its commitments to the Paris climate agreement, would divest its strategic investment fund the extraction or refinement of fossil fuel that represents 20% or more of the business.The fund of $ 10.4 billion had invested about $ 371 million in fuel companies fossils last year, according to Reuters

. The Church of England, which has also invested billions of dollars, announced a more vague disinvestment plan last week. He has pledged to divest in five years companies "that are not on track to achieve the goals of the Paris Agreement" and said that he would pursue his strategy of collaboration with businesses.

Norway's $ 1 trillion sovereign wealth fund More than two years ago, it invested in coal companies and began to focus on other fossil fuels. Last year, his central bank recommended that the country, one of the world's largest natural gas exporters, also sell oil and gas stocks into the fund. "According to the Bank, this will make the government's wealth less vulnerable to a permanent decline in oil and gas prices," he writes.

"It's the financially smart thing to do," said Ellen Dorsey, chief executive of The Wallace. Global Fund, a private foundation that is pulling out fossil fuel companies and encouraging other foundations to do the same.

"In the past five years, the fossil fuel sector has been the weakest sector, financially comparable to the cash sector, you are losing money, and you have lost money. , and you have climatic risks in your wallet, "she said.

Activist investors move away from the inside

In the United States, some of the biggest investors take a different approach to getting fossil fuel companies to cope with climate change – they use their investments to put pressure on domestic businesses.

Thomas DiNapoli, Controller of the State of New York He frequently used the fund's position as a major shareholder to force companies to consider climate change.

DiNapoli spearheaded shareholder resolutions to incite companies to report and reduce their greenhouse gas emissions and recognize the risks they face as the world moves towards low-carbon economies. This spring, he and other activist shareholders have filed about 30 climate-related shareholder resolutions asking investors in the oil, gas and electric utilities to vote for changes. These resolutions often fail, as proponents of disinvestment point out, but they send a message.

"Climate risk is one of the biggest threats to the state pension fund and its long-term investments," DiNapoli said. this year. "As a long-term investor, we want the companies in our portfolio to demonstrate a commitment to sustainability, reducing emissions and a low-carbon future."

Universities worry about money

Disinvestment campaigns carried out in certain cases are also suspended for their investments in cases of decreasing endowments and decreasing research budgets.

Some critics of university disinvestment argue that disinvestment is simply a symbolic act and that university investment in fossil fuel companies is minor. Frank Wolak, professor of economics at Stanford University and specialist in energy markets, said: "The influence of any entity that takes this step is virtually nil. "You are alienating companies that have tremendous expertise in solving the problem. All you do is reduce returns on your investment."

McKibben, however, said Ireland announces the disinvestment move to a new level will continue to play in the coming months. 350.org is helping to organize protests across the globe in September to urge elected officials and other key decision-makers to take further action on climate change.

"The fact that one government understands that it was a key element of the future was really important," he said.

InsideClimate News journalists Georgina Gustin and David Hasemyer contributed to this story.

Editor's Note: The Wallace Global Fund is among the donors supporting ICN.