The role of a small German NGO pushing divestment

by Matthias Möbius

urgewald e.V.

Image by urgewald

In the last years, a worldwide movement called Fossil Free evolved. It pledges to divest public money from fossil fuel industries such as oil, gas and especially coal businesses. Sprouting in the USA a few years back, it has quickly gained ground all over the globe. Billions of Euros of public and private money remain to be divested but the topic is gaining momentum.

In Europe, some cities like Uppsala, Oxford and only Münster in Germany, have already committed themselves to divest. With Oslo being the first European capital that has accomplished this step, the movement is accelerating. The divestment of Oslo is no coincidence, Norway being one of the frontrunners. In 2015, the parliament decided to make the biggest sovereign wealth fund worldwide, the Government Pension Fund Global (GPFG), drop out of coal investments in companies that gain more than 30% of their revenue with coal, 30% share of the power generation for utilities.

The (GPFG) is the biggest private investor in the world with almost 900 billion dollars that stem mainly from the oil business. What is so special about this pension fund is that, unlike in Germany, it has to publish its complete holding list every year. That opens up the possibility for NGOs like urgewald from the northwest of Germany close to Münster to do the enormous job of checking the 9000 companies that the GPFG holds for coal involvements. Together with their Norwegian partners from the NGO Framtiden, that's what urgewald has done in March.

The comparison of their researched list of global coal companies in the coal business and Norway's holdings showed that it is an ongoing procedure. Even according to their own standards there are shares of around 4 billion Euros in approx. 70 companies left. And although by this it is clear that divestment of big investors worldwide like, for example, the GPFG, Allianz or Axa (partial divestments from coal in 2015) is only just beginning. These are among the frontrunners in defining criteria and thresholds for private investors that are going to join in the divestment movement. Until now, there is also a focus solely on coal since coal has the worst emission to energy ration amongst fossil fuels. In addition, coal extraction often goes hand in hand with horrendous environmental and social misdoings. Examples for this are the mountain top removal in the Appalachian Mountains, the forced relocations of natives or funding of paramilitary activities as seen, for instance, in Colombia.

The mentioned NGOs did not only check on the Norwegian portfolio to see how conscientiously they were applying the divestment. They also played a key role in making the GPFG start the actual divestment by thoroughly researching how the pension fund is investing. They published papers on this which went viral in Norway. The next step was to get in touch with the Norwegian government to assess the issue. An ongoing process of exchange on the topic is cleaning up Norwegian money but there is still a lot of work to be done. However, it is refreshing to see how much a handful of people can do.

For anyone interested on the whole story of this look at urgewald's document (in German).