Is your money funding climate change?
By Pablo Brait. (Originally published in The Well, July 27, 2016) If your neighbour asks to borrow something from you that you know he will use to commit a crime, would you lend him what he needs? Or say your neighbour asks to borrow paints and paintbrushes from you in order to make racist placards for a far-right political rally. Would you hand them over? Would you be complicit if you did? What about if your neighbour asked to borrow money? As Australians, we hand our money over to banks and superannuation funds on a regular basis, yet very few of us know what they do with it. And unfortunately, quite a bit of what they do with it is invest in activities that worsen global warming, destroy farmland and forests and pollute our air and water supplies. In 2007 I realised that climate change was the most important long-term issue humanity faced and I dived head-first into activism. But even before that, inspired by my grandfather’s experiences as a holocaust survivor and the life he led afterwards, I had been involved in many social justice and environmental campaigns, and sought to live morally as an individual. When I found out, relatively recently, that my bank and super fund were using my money to fund activities that worsen climate change, this was a blow at two levels. First of all, there was the issue of my personal finances contributing to a problem I was working to solve. Secondly it became very clear just how unaccountable our financial institutions were. We hand over our money to these corporations and they do what they like with it, without input from us. And when I started asking questions about where my money was invested I got the typical spin and obfuscation rather than straight answers. This was despite it being MY money. Luckily, through the dogged work of groups like Market Forces (where I now work) and 350.org, much of this information is coming to light. Since 2008 Australia’s four major banks have loaned almost $50 billion to coal, oil and gas projects in Australia. Commonwealth, Westpac and NAB have been major funders of the Abbot Point coal port on the dying Great Barrier Reef. ANZ has lent Australia’s dirtiest power station, Hazelwood, $430 million, including one deal done a few months after the devastating mine fire in 2014 found to be probably responsible for 11 deaths. All four major banks have lent to the companies looking to expand coal seam gas fracking in Queensland and NSW and all four have lent money to Whitehaven Coal, the company bulldozing the already endangered Leard Forest to build a new coal mine. Superannuation funds use our retirement savings to invest in these same fossil fuel companies and infrastructure.
The irony of a company entrusted with our retirement savings using it to destroy the future livability of our planet is lost on most super funds, which remain irresponsibly complacent when it comes to dealing with climate change.To top it off, investing in companies looking to expand coal, oil and gas use at a time when we urgently need to reduce it is not only immoral, it is also a very risky move financially. The latest science shows that in order to give ourselves a 75 per cent chance of avoiding two degrees of warming, we need to keep around 80 per cent of existing fossil fuel reserves in the ground. At the moment, fossil fuel companies are valued based on the assumption that nothing will be kept in the ground. With the rapid rise of renewable energy and countries that aren’t Australia introducing emissions reduction policies, this is unlikely to occur. What happens when the penny finally drops for investors? It’s impossible to predict but many analysts are saying it’s probably not going to be pretty. Already, 50 US coal companies have filed for bankruptcy since 2012 and many mainstream analysts are saying the crash in the international coal market is structural, not cyclical. In the last two years many super funds have lost money on their fossil fuel investments. Super funds should not be exposing us to this risk. So what to do? Divest! Since 2013 a growing movement is pressuring the banks and super funds (and other institutions like local councils, universities, religious congregations, etc.) to divest (the opposite of invest) from fossil fuels.
The beauty of the fossil fuel divestment movement is it marries the personal and the political. Many are motivated by wanting their personal savings to be aligned with their values. It is about personal choice. But the divestment movement also has global political repercussions. As more and more institutions announce that they are divesting (by the end of 2015 divestment pledges had been made by institutions controlling US$3.4 trillion), the fossil fuel industry becomes increasingly isolated politically.It is primarily the political power of the fossil fuel lobby that has blocked action on climate change over the last 30 years, and as more and more respectable companies and institutions distance themselves from this dirty industry, governments start finding it easier to put good policies in place. In Australia since 2013, thousands of customers have switched from the big four banks to a fossil free bank, and thousands more have put their bank on notice. At the end of last year, this pressure forced all four banks to announce policies in support of keeping global warming below two degrees. NAB took it one step further and committed to never funding the Galilee Basin mega-coal mines, which aim to ship their coal via the Great Barrier Reef. The next step is keeping them to their promises, and for that we need to pile on some more pressure. So if you’re keen to align your money with your values, fight climate change and democratise our financial sector all at the same time, get involved with fossil fuel divestment. You can start by seeing if your bank funds fossil fuels, and if they do put them on notice. You can also look up your superannuation fund here, and send them an email asking them to divest from fossil fuels. And if you’re part of a Jewish community group or synagogue, you can make a communal divestment commitment. Find out more by contacting the Australian Religious Response to Climate Change. Your money, your future, your choice. — This article was reprinted with permission and originally published here: http://www.atthewell.com.au/article/is-your-money-funding-climate-change This post is part of Just Voices #11 – Climate Change.