Fossil Fuel Divestment Has Doubled in the Last 15 Months
Assets and individuals worth $5.2 trillion have pledged to pull their investments out of fossil fuel companies.
Image: Flickr/Mick Tursky
A little over a year ago, it was big news that thousands of people and hundreds of institutions controlling more than $2.6 trillion in total assets had pledged to remove their investments from stocks, mutual funds, and bonds that invest in fossil fuel companies. My colleague at the time wrote that this was an "astonishing figure," a sign that major investment firms were taking seriously a plan to fight climate change with their wallets. A year later, that number has doubled.
According to a report by DivestInvest, a philanthropy helping to lead the movement, more than 688 institutions and 60,000 individual investors worth $5.2 trillion have pulled their investments from fossil fuel companies and have reinvested a portion of their assets into clean energy companies. In September 2015, 436 institutions and 2,040 individuals worth $2.6 trillion had divested. For comparison, the total net worth of investors who had pulled out of the fossil fuel market was just $52 billion in September 2014.
"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," UN Secretary General Ban Ki-Moon said in a statement announcing the news.
Divestment is increasingly seen as one of the stronger moves that private citizens and companies can take to support the move to clean energy. The movement started in earnest in 2011 when college students began petitioning their institutions to remove their assets from stocks, bonds, and mutual funds that invest in fossil fuel companies. What was seen as a gimmick at the time appears to be gaining real momentum a year after the Paris Climate Treaty was signed.
"At the one-year anniversary of Paris, and after a historic election in the US, divestment is needed more than ever," Ellen Dorsey, leader of DivestInvest, said in a statement. "When governments fall short, people step up. From Apartheid South Africa to the climate frontlines, finance is a proven lever for change. Governments should keep their promises, but investors must move their money."