Local authorities have invested £14bn of their pension funds in ‘risky’ fossil fuels, according to new analysis of pension data.
The figures, published by 350.org, Platform, Community Reinvest and Friends of the Earth, show how much each council has invested in fossil fuels. The campaigners argue this level of investment – the equivalent of £218 per resident – shows councils are failing to take responsibility for climate action.
Danni Paffard of 350.org said: ‘Public investments in fossil fuels are fuelling dangerous climate change, and present a threat to the pensions of 4.6 million public sector workers. There’s a strong ethical and financial case for local councils to divest from fossil fuels and reinvest into infrastructure fit for the 21st century.’
The campaigners called for councils to invest this money in local infrastructure instead, saying this would help build 200,000 new social homes or provide solar panels for more than two million homes and public buildings.
‘There is a growing body of evidence suggesting that the financial risks associated with climate change will impact investment portfolios,’ said Natalie Smith, Lawyer of Client Earth.
‘If pension fund trustees fail to properly manage these risks in their investment decision-making process, and there is a consequential decline in value of the pension pots of members, then trustees and investment managers could be sued for breaching their fiduciary duties.’