Local pension fund members call on County Council to stop funding climate change

Press Release
Divest East Sussex [1]
23 September 2019

LOCAL PENSION FUND MEMBERS CALL ON COUNTY COUNCIL TO STOP FUNDING CLIMATE CHANGE
Over 200 pension fund members sign statement in advance of County Hall debate on 15 October

Monday 23 September: As the UN begins its Climate Action Summit in New York [2], 240 members of the East Sussex Pension Fund have signed a statement calling on East Sussex County Council to stop using their pensions to fund climate change. The issue is due to be debated at the next Full Council meeting at County Hall on Tuesday 15 October – the same meeting at which the County Council looks set to agree a ‘climate emergency’ motion [3].

East Sussex County Council (ESCC) currently invests £145 million of the East Sussex Pension Fund in the giant oil and gas companies that are driving our current climate crisis – companies like Exxon, Shell and BP [4].

The statement signed by the Pension Fund members notes that these investments are not only fueling climate change but also ‘pose serious financial risks to investors, including many local pension holders’. It urges the County Council to follow the lead of the 1,100 institutions around the world – including Southwark and Cardiff Pension Funds – who have already committed to divest from (that is, move their money out of) fossil fuel companies [5].

A spokesperson for Divest East Sussex said: “These investments are clearly incompatible with any climate emergency declaration. They also pose a significant financial danger to the Fund and the Council’s current policy of “engaging” with these companies isn’t working. Ditching these investments (‘divestment’) would remove this danger while enhancing the Fund’s long-term returns by helping to align it with a 1.5°C world [6]. It’s time for the County Council to stop funding climate change. ”

Hastings Borough Council, Wealden District Council, Eastbourne Borough Council, Rother District Council and Lewes District Council have now all passed motions declaring a “climate emergency” [7]

NOTES

[1] https://divesteastsussex.wordpress.com/
[2] https://www.theguardian.com/environment/2019/sep/16/un-climate-summit-2019-why-it-matters
[3] See https://divesteastsussex.wordpress.com/2019/09/16/petition-hand-in-should-trigger-debate-on-county-councils-role-in-funding-climate-change/ and https://www.eastbourneherald.co.uk/news/cross-party-climate-emergency-motion-set-for-county-hall-debate-1-9077587. The divestment debate on 15 October has now been confirmed.
[4] Response by the Chair of the Pension Committee to Frances Witt, 16 October 2018: https://democracy.eastsussex.gov.uk/documents/b12581/Item%204%20-%20Questions%20from%20members%20of%20the%20public%2016th-Oct-2018%2010.00%20Full%20Council.pdf?T=9
[5] https://gofossilfree.org/divestment/commitments/
[6] A recent analysis by Jeremy Grantham, co-founder and chief investment strategist of Grantham, Mayo, Van Otterloo, one of the largest asset management firms in the world, concluded that: ‘Investors with long-term horizons should avoid oil and chemical stocks on investment grounds. They face a sustained headwind. In contrast, investing in companies that benefit from decarbonising the economy, although they come with no guarantee of success, do offer a sustained tailwind; their top-line revenues will certainly be growing faster than the rest of the economy.’ (‘The mythical peril of divesting from fossil fuels’, 13 June 2018, https://tinyurl.com/mythicalperil). See also, The Financial Case for Fossil Fuel Divestment, Insitute for Energy Economics and Financial Analysis, July 2018, https://tinyurl.com/financialcase.
[7] See https://seclimatealliance.uk/wp-content/uploads/2019/09/Progress-summary-latest.pdf. The Rother motion was passed on 16 September 2019.

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