Fossil Fuel Divestment and Climate Change
There is a growing global movement calling for the removal of fossil fuels, such as oil, coal and gas, from institutional investment portfolios. As the Guardian notes, there are two main arguments for fossil fuel divestment. The moral argument calls for divestment on the basis that continuing to provide funding for fossil fuel companies will fix the world on a path of irreversible climate change with harmful impacts. The financial argument is that fossil fuels are essentially “stranded assets” that will become worthless if international targets on emissions are met.
Across the world campaigns have seen institutions such as churches, pension funds and universities committing to divestment from fossil fuels. In South Africa, Fossil Free South Africa, along with its partner Fossil Free UCT, is leading the divestment campaign. 350Africa.org is also building an African movement to tackle climate change, including divestment.
Institutional investors have also started working towards addressing climate change. However, while regional climate change investor groups from Europe, North America, Australia and New Zealand and Asia have formed a global investor coalition, there is no representation from or regional organisation in Africa.