Church investors group encourages companies to improve energy efficiency, but remains sketchy about divestment from fossil fuels
By Sophie Yeo
Investors connected to English and Irish churches are pressing companies across the UK to improve their carbon emissions rating, while warning against “oversimplifying” the ethical implications of investing in fossil fuels.
The Church Investors Group (CIG) is a membership body for church investors, made up of 46 members and worth £12bn. The group contacted 53 companies whom they considered to be lagging behind in their efforts to become more energy efficient.
Working with the Carbon Disclosure Project, which provides a platform for companies to share their environmental credentials with investors, they revealed that 72% of these companies have now improved their rating.
This is up from 2012, where only 30% of companies improved their rating as a result of pressure from the group.
CIG aims to encourage investment practice that is based upon the ethical principles of the Christian faith, although each investment body remains responsible for how it implements its advice.
But in a position statement released last month on the growing campaign to encourage organisations and institutions to divest money away from the fossil fuel industry, the group said: “We caution against over-simplifying climate change as an ethical investment issue.
“As church investors, we have stewardship responsibilities towards creation, and responsibilities towards the global poor and vulnerable who will be less able to adapt to climate change.
“But we also have a responsibility to acknowledge that the world’s economy cannot function without energy and that the transition to a low carbon economy is a process that will take time.”
Thanks to a divestment campaign led by Bill McKibben of 350.org in the US, 12 religious institutions have already divested from the fossil fuel industry. They were recently joined in the UK by the Quakers, who said: “We have expressed our difficulties, especially since we all depend in many ways on fossil fuels, but we need to make positive steps towards the change we want to see.”
The Church of England automatically excludes certain industries from its investment portfolio on ethical grounds including tobacco, armaments, gambling, and pornography.
Speaking at a roundtable discussion yesterday, Edward Mason, Secretary to the Church of England’s Ethical Investment Advisory Group, which supports the Church of England’s national investing bodies on ethical investment, said that he was aware that the divestment campaign was moving across the Atlantic.
But he added: “There’s nothing unethical about producing fossil fuels at the moment,” highlighting that they allow development across poorer countries. “We are not apologetic about that.”
Divestment from fossil fuels, he said, requires a decadal approach rather than in instant freeze, and he hoped by 2040 or 2050 then the church would have steered away from unclean sources of energy.
He added that the investments made in renewables had proved unprofitable in the past, and that the Church could neither exist outside of the economy within which it operated, nor ignore the need to provide a financial return on investments.
The best way for the Church to provide a moral basis for investment was for groups to engage with the companies it works with, he said, except where the company proves completely intractable, where divestment may be considered as an option, for instance News Corp or mining company Vedanta Resources.
While Church investors have worked with BP in the past over safety issues arising from incidents such as from the Gulf of Mexico oil spills, they continue to invest in the company.