Why we exist
The world is in a climate emergency. South Africa is warming twice as fast as the global average, with widespread drought hurting farmers and the rural poor. Day Zero – no water – has hit 30 SA municipalities. The UN Environment Programme says global carbon emissions reductions must hit 7.6% annually to meet the 1.5C degree stabilisation target – yet governments are not acting nearly fast enough. Every development gain of the past few decades could now be swept away by a deteriorating climate – yet most institutions in South Africa are in de facto denial.
Universities and philanthropies that should lead reinvestment in a sustainable future are perpetuating the climate problem and SA’s brutal inequality by clinging to increasingly precarious and diminishing returns from coal. Retirement funds risk their members’ prosperity in a possible carbon bubble. Asset managers cling to shorttermism, pushing the economy into a morass of unmitigated externalities.
Continued investments in fossil fuels pose substantial direct (via climate damage) and indirect portfolio risks to investors.
They also represent lost opportunities, as the creative economic and social potential of investments in the sustainable economy now holds massive transformative potential for countries like South Africa that are burdened with mass poverty and inequality.
A powerful solution
Millions of ordinary investors have the unrealised power to insist that their savings are only ethically and responsibly invested. This is no longer idealism; it is an urgent practical imperative. Fossil fuel divestment is one of six key ‘nudges’ that could tip humanity towards rapid decarbonisation. Academics argue most responsible investment practice in SA has little substance. We want to change that with real movements of capital into robust fossil-free ESG funds. Individual investors hungry for ethical investments contact us almost daily, contradicting the asset managers claiming there is no consumer demand for responsible investment in SA.
The basic logic of divestment
Three numbers (highlighted by Bill McKibben in this Rolling Stone article):
2 degrees: The world’s nations have agreed to hold average global warming below two degrees. (Update: This target has been reduced, as of 2015, to 1.5 degrees, as we now understand that even 0.5C more global warming will have catastrophic consequences.)
565 gigatonnes: “Scientists estimate that humans can pour roughly 565 more gigatons of carbon dioxide into the atmosphere by midcentury and still have some reasonable hope (80%) of staying below two degrees.” (Update: This number is regularly revised, but any additional carbon emissions now represent an unacceptably high risk of worsening climate damage.)
2,795 Gigatonnes: “…the amount of carbon already contained in the proven coal and oil and gas reserves of the fossil-fuel companies, and the countries (think Venezuela or Kuwait) that act like fossil-fuel companies. In short, it’s the fossil fuel we’re currently planning to burn.”
In short, fossil fuel companies are planning to burn more than five times the amount of coal, gas and oil that is safe for humanity, and they have to be stopped. Here’s an updated analysis of the math, done by Carbontracker.org.