Fossil Free Action on SPF Press Release

21st June 2016

For Immediate Release

PROTEST AS GLASGOW COUNCIL RUN-FUND POURS MILLIONS INTO POLLUTERS

On 21st June, Strathclyde Pension Fund held its Annual General Meeting (AGM), inviting their 200,000 members to present the fund’s performance and speak about future investment opportunities. The keynote session of the AGM discussed current shares in the fossil fuel industry. Fund managers were previously asked to review the feasibility of disinvesting the fund (taking money out of) from oil, coal and gas companies, which was rejected on the basis of financial risk and that engaging with these corporations might generally be more beneficial. The fund currently holds around £15 billion in overall investments, of which £752 million is invested in fossil fuel companies—making it the second biggest pension fund in the United Kingdom.

On the same day, Fossil Free Strathclyde campaigners – who are calling on the pension fund to disinvest its shares in fossil fuels and to reinvest them in long term sustainable projects – held an action to draw the fund members’ attention on the financial and ethical risks of those investments. In order to comply with the international climate treaty and to limit global temperatures rise to 2°C, it is widely accepted that 80% of known fossil fuel reserves are to become unburnable—thereby becoming ’stranded assets’ for the companies that hold them.

Fossil Free Strathclyde campaigner, Živilė Mantrimaitė, stated “The fund has already lost £26 million due to the current struggle of the coal industry and the dramatic drop in oil price, and stands to lose much more as long as it remains exposed to such risks. Furthermore, the argument that engaging with oil, coal and gas companies will bring them on a more sustainable path is invalid since it cannot prevent them to carry out their core activity, the extraction of fossil fuels, which is the main driving force of the climate crisis.

Fossil Free Strathclyde drew attention to the fact that fossil fuel assets are overvalued—experts are calling it the biggest market failure since the Lehman brothers shock of 2008. Similarly to the housing bubble in 2008, the ‘carbon bubble’ is expected to burst anytime soon. In 2014, Dave Watson, Head of Campaigns in Unison, already highlighted that “Divestment has been used effectively throughout history to place social and economic pressure on an industry or government that is causing harm. By publicly withdrawing financial support, fossil fuel divestment addresses the root of the problem – the unchecked expansion of fossil fuel companies on an endless quest for profit.”

Huge inflatables were used during the action to symbolise this carbon bubble. In addition to engaging with members of the pension fund, campaigners also raised public awareness of the link between finance and the climate crisis by positioning themselves on Glasgow’s Buchanan Steps.

ENDS

NOTES:

For more details on the case for disinvesting Strathclyde Pension Fund, consult our brief at: http://bit.ly/1U6JUn6

For a more detailed analysis of the limitations of engagement, consult our full report at: http://bit.ly/1SCztUj

For a performance review of different investment indexes and to see how alternative investments measure up against traditional portfolios, consult our full financial report at: http://bit.ly/1VQjAwG

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