We are living in an era of climate emergency and we have very little time left. The Intergovernmental Panel on Climate Change has reported that we have no more than 10 years in which to avoid 1.5° of warming, and even that entails significant risks.
This is the biggest challenge ever faced by humanity. It threatens our health, our lives, our civilisation. Combatting the climate emergency must be our priority.
Fossil fuels are at the heart of this crisis. 20 of the biggest fossil fuel companies are responsible for a third of all carbon dioxide emissions. 100 companies are responsible for 90% of those emissions.
Fossil fuel companies currently own around 5 times as much coal, oil, and gas reserves as we can possibly burn if we are to stay within even 2° of global warming – and they are constantly engaged in exploration for more.
These reserves have been paid for by companies like ExxonMobil, Shell, and Chevron. They have no choice but to continue burning them. Their share price, business model, and continued existence is dependent on it.
This is why they spend hundreds of millions of euros every year lobbying European institutions to block and delay climate legislation. This is why they have spent so much trying to cover up and cast doubt on climate science.
And if we don’t stop them from continuing to extract and burn these fuels, we are locking ourselves in to 3, 4, 5 degrees or even more of warming. This would mean the flooding of many coastal cities and the displacement of millions; unprecented heatwaves and rates of natural disasters; serious food, water, and land shortage; refugee crises a hundred times worse than that caused by the Syrian war.
And this is not just about the environment. The complicity of companies like Shell and Chevron in horrific human rights abuses across the world has been well documented. These are not companies that we should have anything to do with, and yet – we are supporting them.
Let’s talk about pensions. Our pensions are supposed to be about looking after our future. My pension is supposed to be for my future. And yet ABP, the body entrusted with managing that capital, is currently investing €16,5 billion of it in fossil fuel companies that are actively engaged in endangering that future. This is being done without the knowledge of most pension holders, and often against their explicit wishes.
I should receive my pension around 2060 – what will the world look like then, if we continue as we are?
When we invest in this industry, we support them financially. But we also support them socially and politically. We send a message that it is ok to do business with this kind of industry. That we accept their power and the status quo.
We can stop this. We can take away a measure of the power of this industry away. We can join a global movement to start breaking down the power of the fossil fuel industry. We can and must stop investing our pensions in these companies. ABP must divest from fossil fuels.
The environmental and ethical arguments for fossil fuel divestment are clear. Divestment decreases financial and social support for fossil fuel companies. It frees up capital that can be invested in developing the renewable energy technologies that we need for a clean energy transition. It adds to the growing pressure on governments to take action against the fossil fuel industry. It sends a clear message that these extractive, destructive, and exploitative models and practices are not to be tolerated.
There is also a powerful economic argument for divestment. Once we accept that fossil fuel companies own fossil fuel reserves that cannot be extracted and burned, it becomes clear that fossil fuel related investments are overvalued.
Regulation such as carbon pricing, falling demand, and high prices of extraction are increasingly meaning that fossil fuel companies are forced to leave their coal, oil, and gas reserves in the ground. This poses a real threat to their share value, and therefore to shareholders, including ABP.
By investing in fossil fuel companies, ABP is gambling with dangerous and risky investments.
This is not just fluffy green environmentalists misunderstanding economics. The risks of fossil fuel investments and stranded assets have been the subject of warnings by banking and insurance giants like HSBC, Lloyds, the Governor of the Bank of England. It is under investigation by ABN AMRO here in the NL.
We have already seen this happening with coal – US coal companies have already lost 90% of their value. ABP’s own investments have lost value as a result of the downturn in the coal industry.
This is not a question of saving the planet vs having a good pension. Fossil fuels are not a safe investment in any sense.
We have a chance to do something big here. To cut ourselves off from a dying industry before it pulls us all down with it. To send a strong message – one of condemnation, but also one of hope.
You will hear tonight from ABP and from Maastricht University.
ABP will probably try to argue that they are already doing enough; that it is better to engage with and try to change fossil fuel companies than to cut the ties completely. But we need to be realistic. We simply don’t have much time and too much change is needed. Engagement is too little, too late, too slow to bring the change we need. It has failed to deliver any substantial concrete successes. And how can it? This industry is financially dependent on burning more fossil fuels than we can take – they can’t afford not to, and we can’t afford to let them.
Engagement is too little, too late, too slow to bring the change we need. And how can it? This industry is financially dependent on burning more fossil fuels than we can take – they can’t afford not to, and we can’t afford to let them.
UM also has a role to play here. The University represents us – staff, students, all UM members. UM has claimed often, publicly, to take sustainability seriously. If this is the case, they cannot stay silent on this issue.
Several universities and cities across the country have already called on ABP to divest. The universities of Groningen, Eindhoven, Utrecht, UvA in Amsterdam. The cities of Amsterdam, Utrecht, Den Haag, Nijmegen, even our own Maastricht Gemeente. Maastricht University is lagging behind.