A Divestment Movement Milestone Proves People Power Gets the Goods

On the heels of COP28, where world governments finally recognized the need to “transition away from fossil fuels” but failed to acknowledge the inevitable phaseout, the global fossil fuel divestment movement surpassed a major milestone, already leading the way to a fossil free world: 1,600+ institutions, representing $40.6 trillion in assets, are cutting ties with the toxic energy of the past.

This is a stark reminder: When oil companies are corrupting world governments (see: COP28) we fail to move at the pace and scale the climate crisis requires—but people power gets the goods.

2023 saw record-breaking climate chaos around the world, from fires and floods, to deadly heat and smoke—and fossil fuel corporations and their financiers are responsible.

Divestment is one (powerful) tool in our toolbox to take on fossil fuel greed and transform our energy and financial systems to be community-led, accessible, and democratized.

Swiss pension fund CPEG, the U.K.’s Wiltshire Pension Fund, and the largest private pension in the Netherlands are the latest to join the unstoppable movement. In 2023 alone, major divestment commitments were made by the Church of England, New York University, the National Academy of Medicine, and Triodos Bank.

From Fossil Free Research to Fossil Free Careers, the intergenerational, interracial divestment movement has helped create the political and public space to reclaim our economy from fossil fueled interest. Not only is a world beyond fossil fuels possible, it’s happening right now—it’s time for fossil fuel executives and their financiers to stop holding us back.

According to the Global Fossil Fuel Divestment Database, the world’s most comprehensive index of institutional fossil fuel divestment commitments managed by Stand.earth, divestment spans every sector of society—and continues to grow.

Surpassing 1,600 fossil fuel divestment commitments would not have been possible without millions of climate justice leaders and activists around the world, and countless economic, racial, and climate justice organizations. As the movement enters its 13th year, and sets sights on bigger victories, we also want to mark the steadfast support of Ellen Dorsey who is stepping down as head of the Wallace Global Fund (WGF). WGF has supported this movement from its inception, building upon the success of the Anti-Apartheid Divestment Movement.

From educational institutions and public pension funds, to faith-based and healthcare groups, to governments, nonprofits, and cultural institutions, major institutional investors have even reported consistent positive or neutral returns following divestment—despite broader economic volatility and insecurity.

More than a decade of data affirms that fossil fuel divestment is a winning financial strategy, including early adopters of divestment strategies reporting neutral or positive financial results. This follows years of attempted shareholder engagement, now a proven futile strategy, with fossil fuel corporations hell-bent on our destruction.

This includes Danish pension AkademikerPension, which engaged in a rigorous and transparent shareholder engagement process with fossil fuel companies, dropping the final oil major from its portfolio—Italian oil company Eni—because “top management in the oil and gas sector simply refuse to do so in manner consistent with the goals of the Paris agreement.”

Notably in its decision, AkademikerPension reported positive financial returns after shedding the last major oil and gas investments.

If 1,600+ institutional commitments doesn’t convince you, let’s look to the International Energy Agency (IEA): In its annual World Energy Outlook 2023 report released in October, the IEA revealed that our energy systems are already on track to transition off fossil fuels with demand decreasing significantly by 2030.

As IEA Executive Director Fatih Birol said:

The transition to clean energy is happening worldwide and it’s unstoppable. It’s not a question of “if,” it’s just a matter of “how soon”—and the sooner the better for all of us.

On top of this, a June 2023 foundational report from the University of Waterloo revealed that just six U.S. public pension funds would be $21 billion richer had they divested from fossil fuels a decade ago. This includes major pensions in the Climate Safe Pensions Network. Specifically, the two largest public pensions in the United States—CalPERS and CalSTRS collectively representing over $780 billion in assets—missed out on over $9.6 billion in returns.

Divestment is one (powerful) tool in our toolbox to take on fossil fuel greed and transform our energy and financial systems to be community-led, accessible, and democratized.

This strategy must be employed alongside solidarity with Indigenous and frontline fights to directly stop toxic and unnecessary and sovereignty-violating fossil fuel projects; together with the growing movement to stop the money pipeline from banks, pensions, and financial institutions to fossil fuel corporations; and with dozens of municipalities and states, most recently the state of California, launching lawsuits against major oil corporations for climate deception and damages.

Even in times of heartache, we find hope and resolve in our collective work to hold polluters accountable for their destruction, and to reclaim, repair, and rebuild healthy and safe communities.

Instead of financing climate chaos-causing fossil fuels, violence, and extraction, financial institutions like big banks and pension funds must protect people and the planet alike, cutting ties with fossil fuels and reinvesting in proven community-led climate-safe solutions. Together, the many will defeat the dirty money.