Markets & Justice

Markets & Justice
Freely operating markets yield a just outcome?

White Australia Has A Black History

White Australia Has A Black History

Wednesday, 6 May 2015

The Church of England and the Anglican Church in Australia divest

This information has come via a newsletter from the Galilee Basin Alliance
To keep up with what the Anglican Church in Australia is doing about divestment, please go here.
Advocacy would be pleased to receive information about what is happening on the ground in Anglican dioceses across Australia.  Our email address is on the side bar and you will find our social media links there too. 
April 30, 2015 10:03 pm

Church of England blacklists coal and tar sands investments

Pilita Clark, Environment Correspondent

FORT MCMURRAY, ALBERTA, CANADA - NOVEMBER 2008: Aerial views of the mines of Syncrude Canada Ltd and Suncor Energy Inc, inlcuding one of Syncrude's tailing ponds, with oil remains floating on it. Tar sands, or oil sands, are very dense and contain a form of petroleum The world's largest reserves of tar sands in Canada and Venezuela. Tar sands could equate to approximately two thirds of the total global petroleum resource. Until recently it was financially not viable to extract the oil from the sands, but new technology and rising oil prices have now made it viable. (Photo by Veronqiue de Viguerie/Getty Images)©Getty
ewslOil floats on a pond at a tar sands mine in Canada
The Church of Englandone of the world’s wealthiest religious institutions, has decided to blacklist coal and tar sands investments, in a striking victory for campaigners seeking to make fossil fuels as unpopular as tobacco.

The Church announced on Thursday that it would sell £12m of its holdings in thermal coal and tar sands companies, two of the most polluting fossil fuels. “Climate change is the most pressing moral issue in our world,” said the Bishop of Salisbury, the Rt Rev Nick Holtam, lead bishop on the environment.
The move comes nearly three years after the appointment of Justin Welby, a former senior executive at the now defunct Enterprise Oil company, as Archbishop of Canterbury.
The Church, which has an investment portfolio worth more than £9bn, will no longer put its money into any company that gets more than 10 per cent of its revenues from extracting coal burnt for energy or oil from tar sands.
This means it may retain shares in companies such as BHP Billiton, which mines coal but earns a large chunk of revenues from iron ore, copper, and aluminium, said Edward Mason, the Church’s head of responsible investment. But companies that focus on coal mining, such as Peabody in the US, would be excluded.
“It’s about an alignment of interests,” Mr Mason said. “If you are a specialist coal mining company you don’t share the interest that we have in the transition to a low-carbon economy and the sense of it as a moral imperative. But if you are a BHP Billiton, where coal is a small part of your portfolio, we can have a constructive conversation with you about the future of coal for you as a company.”

In depth

View of the bed of Jacarei river dam, in Piracaia, during a drought affecting Sao Paulo state, Brazil on November 19, 2014. The Jacarei river dam is part of the Sao Paulo's Cantareira system of dams, which supplies water to 45% of the metropolitan region of Sao Paulo --20 million people-- and is now at historic low. AFP PHOTO / NELSON ALMEIDA (Photo credit should read NELSON ALMEIDA/AFP/Getty Images)
The latest news and analysis on the world’s changing climate and the political moves afoot to tackle the problem
The Church’s move makes it one of the most prominent recruits to a grassroots campaign that is spreading around the world and is modelled on the 1980s divestment movement to end apartheid in South Africa.
Heirs to the Rockefeller oil fortune, California’s Stanford University and the World Council of Churches have already said they will reduce or cut fossil fuel investments. The Financial Times reported this week that Prince Charles is also shunning such holdings.
Pope Francis, meanwhile, is expected to deliver an encyclical letter — the most important form of teaching by a Catholic pontiff — in June, that will urge the world’s 1.2bn Catholics to consider the risks of climate change.
Cardinal Peter Turkson of Ghana, a member of the Pope’s inner circle who wrote an early draft of the encyclical document, told a conference in Rome on Tuesday that burning fossil fuels was disrupting the earth’s delicate ecological balance “on an almost unfathomable scale”.
The Vatican’s move has stoked the expectations of environmental activists ahead of a global climate change agreement due to be agreed in Paris at the end of this year.

Steam rises from a smoke stack at the Suncor tar sands processing plant near Fort McMurray, Alberta, September 17, 2014. In 1967 Suncor helped pioneer the commercial development of Canada's oil sands, one of the largest petroleum resource basins in the world. Picture taken September 17, 2014. REUTERS/Todd Korol (CANADA - Tags: ENERGY ENVIRONMENT) - RTR47FSJ
Some climate-conscious investors prefer engagement on fossil fuels
Until now, the Church of England has been engaging with the oil, gas and coal companies it has invested in, rather than divesting from them. It led a successful shareholder push earlier this month to encourage BP to be more transparent about how climate change could affect its business.
This engagement work is likely to continue, said Tom Joy, director of investments at the Church Commissioners, which manages Church assets. “But this new policy rightly goes beyond to incorporate investment exclusions for companies focused on the highest carbon fossil fuels where we do not think engagement would be productive,” he added.
Pierre Jameson, chief investment officer of the Church of England Pensions Board, said: “We need governments meeting in Paris at the end of this year to agree long-term global emissions targets with a clear pathway to a low-carbon future.”

Financial Times:

Rio Tinto and BHP Billiton in firing line as UK charities shun fossil fuelsJames Chessel
Australian Financial Review (Paywall)
May 3 2015

BHP Billiton and Rio Tinto may not be immediately affected by the Church of England's decision to shun energy coal and tar sands, but the big miners are an increasingly difficult investment choice for charitable foundations, universities and even the royal family in the United Kingdom. 
The Church of England, which is one of the world's richest religious institutions with a £9 billion investment fund, last week became a high-profile addition to a global campaign to blacklist fossil fuel investments when it announced a £12 million divestment in any company generating more than 10 per cent of its revenues from thermal coal used in power stations or the production of oil from tar sands.
"It marks the start of a process of divestment as well as engagement with fossil fuel companies and better aligns the church's investment practice with its belief, theology and practice," said the Right Reverend Nick Holtam, lead bishop on the environment for the church.
"Climate change is the most pressing moral issue in our world."
The Church of England divestment – which comes three years after the appointment of former oil executive Justin Welby as Archbishop of Canterbury – was not the only victory in the UK for campaigners seeking to end investment in companies that produced fossil fuels.
The Financial Times revealed Prince Charles, the National Trust, the Church of England and the universities of Oxford and Edinburgh were reviewing their shares in such companies.
Meanwhile, the Guardian reported seven UK charitable foundations – including three linked to the Sainsbury family which founded the UK's second-largest supermarket chain – worth a collective £234 million had decided to sell their fossil fuel investments and re-invest the money in green businesses.
"Fossil fuel companies have not taken the opportunity to wind down or change their business models," said the statement from the foundations. "They are now significantly overvalued. The half a trillion dollars spent annually seeking new reserves will be wasted. The smart investors have already divested from coal."

'Moral responsibility'

Both the Church of England and the foundations argue the continued use of fossil fuels contributed to income inequality among nations.
"The church has a moral responsibility to speak and act on both environmental stewardship and justice for the world's poor who are most vulnerable to climate change," said the Reverend Professor Richard Burridge.

Divestment plans in UK have been announced by the University of Glasgow, the British Medical AssociationSOAS, University of London as well as the publishers of The Guardian, which has launched its own campaign: Keep it in the ground.
In the United States, heirs to the Rockefeller oil fortune as well as California's Stanford University have pledged to cut fossil fuel investments.
The Church of England's pension board is a small shareholder in BHP and Rio with a combined holding worth £19 million according to its last published annual report in 2013.
Both companies produce energy coal but not enough to bring revenues above the 10 per cent threshold because of  their substantial iron ore, copper and, in the case of BHP, oil earnings.
A spokesperson for the church, Claire Barraclough, was unable to say how the church arrived at the 10 per cent number.
It is understood both miners have held discussions with the church and its fund manager, CCLA, last year. 
"Action for A", a coalition of investor groups backed by CCLA, a UK fund manager which invests on behalf of charities, this year successfully pushed for resolution at the annual meetings of BP and Shell obliging the oil majors to set out the potential cost of climate change to their businesses.
A spokesperson for CCLA said there were not plans to file any resolutions at the upcoming BHP and Rio annual meetings. 
A CCLA representative complimented BHP chairman Jac Nasser on the company's "open engagement, efforts and commitment" to discussing climate change issues at last year's annual meeting, adding "we were also delighted to see you sign the World Bank's statement on carbon pricing".
While the institutions that have made fossil fuel divestments hold a relatively small number of shares in Australian mining companies, some BHP and Rio executives are privately concerned the campaign could tempt larger shareholders to sell out. 
For example The Guardian is lobbying UK biomedical research charity Wellcome Trust – which had a combined $US307 million holding in Rio and BHP as at September 30 – to end investment in fossil fuel companies. 
The trust has held on to its BHP and Rio shares, preferring to "press for more transparent and sustainable policiesthat support transition towards a low-carbon economy". 
However, one senior mining executive it was "only a matter of time" before "some of the larger investors in resources companies withdraw from the sector". 
The executive cited Bill McKibben, a US environmentalist who founded the climate campaign group, as a "new and highly sophisticated type of group that is having a serious impact pushing the divestment agenda". 
Mr McKibben had previously criticised the Church of England for failing to act on climate change. 
The anti-fossil fuel lobby is expected to make its case for divestment to be global climate change agreement at the United Nation's climate change conference in Paris in December.