Why are we talking about investments?
Financial investment in companies profiting directly from the extraction, production or sale of fossil fuels is investment in the harming of life on this planet.
Fossil fuels are very widely used across the world, including for electricity generation: coal provides most (57%) of the energy generated in China while 71% of electricity in the USA in 2019 was generated from oil and gas; meanwhile in 2020 the UK generated 36% of electricity from hydrocarbon gas. Turning to transport, fossil fuels powered 90% of more than two million new passenger vehicles sold in the UK in 2019.
All uses of fossil fuels produce copious and harmful emissions: across all industries and sectors, coal, oil and gas produced 93% of global CO2 emissions in 2020. In addition to CO2, the burning of fossil fuels often produces carbon monoxide, nitrogen oxides and other gases harmful to the environment and to human life.
Divestment from these industries could make good financial sense for our portfolio. Over the long term, as the effects of climate change become more apparent, and as more and more governments adopt policies to limit carbon pollution, the carbon resources that fossil fuel companies currently count as assets might shift to liabilities.
What have we done?
The charity has investigated its investment portfolio from an environmental perspective to ensure it meets high environmental standards, using ESG and other relevant tools. We have completed our first phase of investigative work and achieved the equivalent of an AA ESG rating.
What are we doing next?
The next stage is to further investigate future ESG funds and we are beginning this piece of work in early 2024.