Ireland keeps its promise and divests from coal and oil investments
Environment — di Valentina Neri
For the very first time, a sovereign wealth fund divests all of its investments in fossil fuels. The historic decision was made by Ireland.
Ireland keeps its promise and divests from coal and oil investments
For the very first time, a sovereign wealth fund divests all of its investments in fossil fuels. The historic decision was made by Ireland.
Ireland is the first country in the world to divest all of its investments in fossil fuels. This decision had already been taken more than a year ago, but on Thursday 12 July it became official, with the approval of the bill by the Dáil Éireann, the lower house of Dublin's parliament. The measure received the support of all parties.
BREAKING: Ireland just became the first country in the world to fully divest from fossil fuels! #FossilFree
No more public money for coal and oil
The Irish sovereign wealth fund will therefore have to sell all of its investments in coal, oil and natural gas, and do so "as soon as possible". Given the timescales involved in an operation of this kind, the Guardian estimates it will take around five years. Specifically, all companies that derive at least 20 per cent of their revenues from the exploration, extraction or refining of fossil fuels are struck from the list. Investment in Irish companies will still be permitted, provided it serves to finance their transition towards other energy sources.
The state investment fund manages a total of around 8 billion euros. This figure may appear negligible compared with those managed by other sovereign wealth funds: Norway's now exceeds one trillion dollars, followed by Abu Dhabi (828 billion dollars), China (more than 800 billion), Kuwait and Saudi Arabia (both exceeding 500 billion). But this decision carries an immense symbolic value, because nothing like it had ever been done before so unequivocally.
The example usually held up as a virtuous model is the Norwegian sovereign wealth fund, which became the largest in the world precisely thanks to revenues from oil exports, yet has distinguished itself for several years through its ethically guided investment choices. Statens pensjonsfond Utland, however, has only divested from certain companies operating in the coal sector, retaining a small share of oil investments. At the end of last year it decided to divest from these entirely, for purely financial reasons: quite simply, the analyses "showed that oil and gas stocks are significantly more exposed than those of other sectors to fluctuations in oil prices". The decision will need to be ratified by the government and parliament in Oslo.
Dublin wants to make up ground on the climate front
"Today parliament has sent a strong signal to the international community about how necessary it is to accelerate the process of moving away from fossil fuels," declared Éamonn Meehan, executive director of the non-profit organisation Trócaire, affiliated with the Irish Catholic Church.
A step forward that is all the more significant when one considers that, Meehan continues, only last month Ireland was ranked second to last in the ranking drawn up by Climate Action Network Europe on the European countries most active in the fight against climate change. A ranking that places Sweden, Portugal and France on the podium, and Poland, still heavily reliant on coal, at the bottom. Italy sits more or less in the middle, in twelfth place out of 29.
It is fair to say that 12 July was a historic day for Ireland, which, in addition to changing course on the management of the sovereign wealth fund, also took another momentous decision: banning fracking, the underground drilling technique that uses hydraulic fracturing, which is highly controversial for its impact on the environment and on people.
States, funds, universities and churches flee from fossil fuels
The movement to divest from fossil fuels is gaining ever more high-profile support. Just a few days ago, the Church of England pledged to sell its stakes in all companies that do not align with the goals of the Paris Agreement.
Yesterday @lborouniversity committed to #divest ALL #fossilfuels after an amazing one year campaign by @LufbraPandP 🙌😎🎉❌
At the same time, announcements from universities are coming in almost daily, with higher education institutions particularly active on this front. In the first half of July alone, Queens' College and Loughborough University also said "no more" to investments in coal and oil, and there are good hopes for the University of Leeds too, which will make its decision in November.
Governments will be openly called to account on Saturday 8 September: this is the date chosen for Rise for Climate, a day of mobilisations around the world in defence of the climate and sustainability.