Britain’s government will make it easier for pension funds wielding £2 trillion in assets to divest from oil, gas, and coal companies.
British workers annually contribute about £87 billion to pension schemes. Much of it is “automatically invested into gas and oil companies such as BP and Shell,” the Guardian reports, following the guidance of trustees whose narrowly-defined fiduciary duty requires them “to seek the best returns irrespective of the threat of climate change.”
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Now, the outlet writes, “in what has been hailed as a major victory for campaigners against fossil fuels, the government is to introduce new investment regulations that will allow pension schemes to ‘mirror members’ ethical concerns’ and ‘address environmental problems.’”
“Thanks to these new regulations, savers will finally have the clear opportunity to have their say on where their money is invested and can reflect what is personally important to them, whilst delivering mutual benefits,” said Guy Opperman, the Conservative British minister responsible for pensions.
Earlier this year, a large Danish pension fund sold off its investments in the Canadian tar sands/oil sands rather than suffer losses when the carbon reserves underlying those assets become stranded by a combination of climate policy and falling demand. “Across the world,” notes the Guardian, “more than 800 institutions, with total investments valued at US$6 trillion, have committed to divest from fossil fuels.”
However, several of Canada’s largest pension funds, including the Canada Pension Plan Investment Board, the Ontario Teachers Pension Plan, and the Caisse de dépôt et placement du Québec (CDPQ), continue to invest in fossil assets.
The new UK rules are expected to come into force next year.
