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On Wednesday (27 May), the Finance Committee of the Norwegian Parliament made a unanimous recommendation to divest the country’s sovereign wealth fund from the coal industry.
As well as being the world’s largest sovereign wealth fund, the Norwegian Government Pension Fund Global is also one of the top 10 investors in the global coal industry.
Oxford’s divestment – a cautious first step, but alumni will hand back degrees
The recommendation asks the government to exclude companies that derive over 30% of their revenues or power production from coal. It will be formally adopted by the parliament on June 5.
‘Coal is bad for all aspects of our environment: it destroys landscapes, contaminates water resources, pollutes the air and is the number one threat for our climate. Such investments are not in line with the values of Norwegian society, and the unanimous vote of the Finance Committee means that this is now recognised across all party lines.’
Arild Hermstad from The Future in our Hands, a Norwegian NGO
Labour MP Torstein Tvedt Solberg, who helped broker the agreement, says, ‘I am pleased that all parties have agreed to withdraw the Pension Fund from coal. This is a great victory for our climate.’
‘Through this decision, Norway is really taking a lead’, says Heffa Schücking from the German NGO urgewald. According to Schücking, the Norwegian exclusion criteria go further than what French Insurer Axa announced last week and set a new standard for investors worldwide.
NGOs expect that the pension fund’s investments in companies like Germany’s RWE, China’s Shenhua, Duke Energy from the Unites States, Australia’s AGL Energy, Reliance Power from India, Japan’s Electric Power Development Corporation, Semirara Mining from the Philippines and Poland’s PGE will all be shed.
‘Norwegian NGOs will not be alone, when they celebrate’, says Schücking. ‘There are broad popular resistance movements against the coal industry in all of these countries, and they are going to say: Thank you for divesting, Norway!’
The Parliament is instructing the Norwegian Government to begin implementing the new criteria from January 2016 onwards. ‘We expect that billions of euros will be withdrawn from the coal industry, when this happens’, says Truls Gulowsen from Greenpeace. ‘This is a huge win for the divestment movement and a real sign of hope that investment patterns can be changed’, he adds.
‘If you’d told any of us, three years ago, that the planet’s largest sovereign wealth fund would begin divesting, we would have laughed. The way this idea – that the world has far more fossil fuel than it can burn – has spread is an enormously hopeful sign. There’s much work to be done taking on coal, oil and gas but the momentum is definitely on our side.’
Bill McKibben, co-founder of 350.org
Since the launch of the divestment campaign in 2012, more than 220 institutions and local governments – alongside thousands of individuals – have pledged to divest from fossil fuels. Together, that represents over $50 billion in assets.
In this short period of time, the divestment movement has expanded its scope to include colleges, universities, faith organisations, municipalities and, most recently, pension funds.
According to a study by Oxford University, the fossil fuel divestment movement is the fastest growing divestment campaign in history. At present there are approximately 500 active campaigns worldwide.