Ellen Dorsey, director of Wallace Global Fund and EDGE board member, made a strong call to foundations to live up to their responsibility by divesting assets from fossil fuels in the first #EDGEtalk webinar on ethical investment on 14 March 2016: Philanthropy has to “weaken the power of the fossil industry, cutting off funding from carbon bombs, and seed and scale up the alternatives with both our grants and our investments”, she said in the webinar “Beyond COP21: What does de-carbonisation mean for investments?”.
Alexander El Alaoui, ethical investment advisor with the German NGO Brot für die Welt, underlined the important market signal coming from the Paris agreement, which called to “making financial flows consistent with a pathway towards low greenhouse gas emissions”. Indeed, Peabody Energy, the self-declared “world’s largest private-sector coal company”, lost 13% the day after Paris, whereas renewable energy indexes were rising significantly. For The Economist, the “most significant effect [of the Paris agreement] will be the signal send to investors”.
Ellen Dorsey recalled that the divestment movement grew expontantially from a few student activist groups putting pressure on their universities only three years ago, to more than a 1000 institutions and individuals committing to divest 1.3 trillion USD out of the fossil fuel industry. Thanks to this movement, the reality of a carbon bubble and stranded assets – industry owned fossil fuel reserves that won’t be sold or burnt – entered in the public discourse. The ethical and economic imperative to divest from fossils had to be matched with investments in solutions to build a just transition to a new economy, Ellen Dorsey said.
The next Money Matters #EDGEtalk “Value based investments – How to support the emergence of an economy based on justice and sustainability?” will take place on 14 April 206, 15h to 16h CEST (Brussels time).