Fossil fuel divestment - responses to objections

Since the NSW/ACT Synod of the Uniting Church’s decision in April 2013 to divest from corporations engaged in the extraction of fossil fuels, there have been a number of objections to divestment expressed by Uniting Church members.  As the original movers of the divestment proposal, Miriam Pepper and Justin Whelan respond directly to several issues that have been raised.

Issue 1. In blacklisting the entire fossil fuels extraction sector, the divestment resolution unfairly targets fossil fuel companies that operate in an ecologically and socially responsible manner. 

Our response: Regardless of measures which may or may not have been taken to mitigate the direct effects of mining on local communities and local ecologies, the fossil fuel industry has for years deliberately undermined steps towards effective climate change legislation.  Globally, fossil fuel reserves are worth trillions of dollars on corporations’ balance sheets, assets which they fully intend to exploit.  Regardless of the present social benefits of fossil fuels extraction (which do exist but which are also unequally shared), the core business of these corporations, that is the extraction of fossil fuels, is jeopardizing the climate.  To have a reasonable chance of avoiding the two degree “tipping point” of catastrophic global warming, the large majority of fossil fuel reserves will need to remain in the ground or under the sea.

Issue 2. In blacklisting the entire fossil fuels industry, the divestment resolution fails to recognize the role that some corporations play in helping developing countries to access gas and oil (and the royalties from these) for their development. 

Our response: Climate change is already a burden on the global poor, for example through the loss of food security, changes in disease patterns and flooding.  Without a swift transition away from fossil fuels, the scale of the threat to the world’s poor is terrifying.  There is disagreement about the extent to which the efforts of particular fossil fuel corporations are benefiting the populaces (and especially the poorest people) of particular developing countries and regions.  But that aside, it remains that case that the core business of fossil fuel corporations is not altruism – they are directly profiting from an escalating threat to the world’s poor.  Institutional investors that choose to withdraw their money from fossil fuels are choosing not to profit from climate change.  Funding renewable energy and energy efficiency solutions for poor communities could be an alternative investment strategy for divested funds. 

Issue 3. The divestment resolution does not recognize that coal is essential for steel production.

Our response: Approximately one third of Australian coal production is coking coal (coal that can be – but is not always – used in the production of steel).  Currently, there are no viable technologies to totally replace coking coal (although there are existing technologies that can improve the efficiency of coking coal use, and other technologies in development).  The divestment resolution did not distinguish between thermal and coking coal.  As with other sectors, our present use and production of steel cannot dodge the issues that needing to leave most of the world’s fossil fuel reserves intact raises.  Proponents of fossil fuel divestment do not expect that their actions will lead to massive capital flight and collapse of the fossil fuel industry, any more than did our divestment from alcohol and tobacco in the case of those industries.  Rather, divestment is primarily a symbolic, prophetic action whose main value is the public attention it brings to the urgency of acting on climate change, the need to leave fossilized carbon in the ground, and the immorality of profiting from climate change.  Such attention is a prerequisite to plans for an orderly but rapid transition away from fossil fuels, which will include difficult questions about the best uses for the remaining carbon budget. 

Issue 4. It is hypocritical to divest when we rely on fossil fuels in our day to day living for transport, electricity and so on.

Our response: Our society is deeply dependent on fossil fuels at all levels – individuals and families, our churches, institutions, even our governments’ budgets.  However, we are now at a crisis point where the status quo is threatening the well-being of God’s beloved creation, including humanity.  It is precisely because of this that advocacy to shift away from fossil fuels is needed.  That advocacy inevitably begins from a compromised position given our structural reliance on fossil fuels.  Efforts for individuals and organisations to reduce their ecological footprint are important, but they are not a substitute for advocating for structural change.  The efforts of successive governments, federal and state, to drive such changes have been feeble.  Divestment has a proven track record (in concert with other campaigning strategies) of playing a role in bringing about political change.  Decisions of institutions, such as our Synod, to divest from fossil fuels aim to place moral and economic discussions about climate change, and the question of profiting from it, squarely into the mainstream of our society.

Issue 5: Divestment fails to recognize the importance of/opportunities offered by the fossil fuel industry for employment in Australia.

Transitioning away from a fossil fuel economy presents many challenges.  However, it also offers the prospect of benefits for communities who don’t only benefit from fossil fuel industries through employment and other revenues, but who also suffer the ill-effects of the industry.  Research suggests that renewables would generate more jobs per dollar invested than the current fossil fuel industry.  Compensation and income support is required in the transition, and environmental groups and unions continue to work together on these issues.  Religious groups also have a role in advocating for “just transitions” and in supporting individuals and communities on the ground as they deal with the transition.