Divestment is the process of removing certain investments from a portfolio based on moral values or political beliefs or motivations. You can divest by following these four steps:
Step 1: Find out how much you have invested in fossil fuels
If your institution has a money manager, wealth management firm, or financial advisor who is the custodian of your investment funds, send them the top 200 coal, oil, and gas companies by carbon reserves and ask them to calculate the amount of your institution’s holdings that are represented on that list. In general, balanced or diversified funds have around 10 percent in fossil fuel investments (of course this number will vary depending upon your investment strategy).
Step 2: Discuss your divestment options with your custodian
What are the options for fossil fuel divestment? Your money manager should be able to help you develop several. This may include investing in a new portfolio or creating a unique product. If the custodian is unwilling or unable to develop fossil free investment opportunities for you, please know you have options. Note that the financial service community, especially those already involved in the area of socially responsible investing (SRI), are aware of the divestment campaign and are scaling up to respond.
If you do not have a custodian, you may use the links at the bottom of this page for more details about possible options or just contact us.
Step 3: Look at fee structures, find out what’s best for you
How are the fees structured now, and how will they change with a move to a fossil free investment strategy? For a successful divestment, you should identify the investment management approach that works best for you and “do the math” on fees to make sure your expectations are met. See our section on fees.
Step 4: Tell us your story and how we can help
Tell us your story so we will ensure that it won’t be unnoticed. Fossil fuel divestment takes the fossil fuel industry to task for its culpability in the climate crisis. By naming this industry’s singularly destructive influence — and by highlighting the moral dimensions of climate change — we hope that the fossil fuel divestment movement can help break the hold that the fossil fuel industry has on our economy and governments. That is why it is important to ensure that the divestment stories will be noticed.
Let us know if you what challenges you face and how we can help you to overcome those.
Helpful Resources
Resilient Portfolios & Fossil Free Pensions.
Beyond Fossil Fuels: The Investment Case for Fossil Fuel Divestment.
Investing to Curb Climate Change
Managing for Fossil Fuel Risks: A 6 point plan for Australian Superannuation Companies