Funds committed to fossil fuel divestment double in a year


Dec 20, 2016 (LBO) – The value of investment funds committed to selling off fossil fuel assets has doubled in just over a year, a new report states.

The value of these funds doubled to 5.2 trillion dollars last year.

The report, produced by Arabella investment advisors for the DivestInvest coalition, collated public pledges by funds to sell off some or all fossil fuel investments, the Guardian reported.

The fossil fuel divestment campaign began on university campuses in 2011 and concerns over investments in coal, oil and gas have now entered the financial mainstream.

The report found that 688 institutions and more than 58,000 individuals across 76 countries are now committed to divestment, including major financial institutions such as the world’s biggest sovereign wealth fund, owned by Norway, and Allianz and Aegon.

Although difficult to calculate the precise proportion of fossil fuel investments in complex funds, about 400 billion dollars of the 5.2 trillion dollar total is likely to be in coal, oil and gas. Asset managers controlling 1.3 trillion dollars – a quarter of the total – have also committed to increasing their investments in clean energy to accelerate a transition to the low-carbon economy.

The new total was welcomed by the UN secretary general, Ban Ki-moon, who said: “It’s clear the transition to a clean energy future is inevitable, beneficial and well underway, and that investors have a key role to play.”

“I commend today’s announcement that a growing number of investors are backing a shift away from the most carbon-intensive energy sources and into safe, sustainable energy,” said Ban.

Lou Allstadt, a former senior executive at Mobil Oil, said: “Divestment is speeding up the clock on the final accounting that will show fossil fuels are out and clean energy is in.”

Arabella measured the total assets (or assets under management for financial institutions) of institutions that have committed to divest.

Asset sizes reported do not represent sums divested from fossil fuel companies. Rather, asset sizes represent total assets held by institutions that have committed to divest.

The report can be viewed here

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