Fossil Free Oxfordshire wins changes to Oxfordshire Local Government Pension Scheme

Fossil Free Oxfordshire, a climate change lobby group based in Oxford, has successfully influenced the county’s £2.5bn Local Government Pension Scheme to make critical changes to their investment strategy in response to the climate emergency. The Pension Fund Committee has agreed to align the Fund’s investments with the Paris Agreement, i.e. a limit of 1.5°C in global temperatures and net zero carbon emissions by 2050; they have also agreed to a target of 7.6% reductions in the Fund’s greenhouse gas emissions  year on year.  The Scheme will initially switch 5% of their assets into low carbon funds, a move described by the Independent Financial Advisor as a ‘first step,’ with the implication that more will follow. The new Climate Change Policy was signed off in June this year following seven years’ protesting, lobbying and educating by Fossil Free Oxfordshire (FFO), who persuaded the members of the Pension Fund Committee to recognise the climate crisis and contribute to the changes necessary to mitigate the devastating impacts that will follow unless swift action is taken. FFO continues to argue that the Pension Fund should divest from fossil fuels immediately, but is pleased to see that the Pension Fund has taken some small steps towards divestment and will continue to ensure it stays on a path to move away from fossil fuel investment with a clear timetable.

The Local Government Pension Scheme has 225 employers and approximately 64,000 members from all areas of council run activities including school teachers, library workers, social workers, public health staff, fire-fighters, waste disposal staff and many others.

Great strides were made at a climate change workshop organised by Council officers and the Committee in November 2019. A wide spectrum of stakeholders were represented, to FFO were asked to submit nominations for presenters. Following this session FFO were invited to join a newly formed Working Group to turn the key points from the workshop into a new Climate Change Policy for the Scheme; this resulted in the changes that the Fund Committee has now agreed to implement. FFO continues to be part of the Working Group and is ensuring that the targets are met, while continuing to argue for an acceleration in fossil fuel divestment beyond the measures already agreed.

It is estimated globally that up to $14.6trillion worth of funds have divested from fossil fuel funds and companies (https://gofossilfree.org/divestment/commitments/) by a wide-ranging group of organisations including faith-based organisations, philanthropic foundations, educational institutions, governments and many other large pension funds.  Recently the UK’s biggest pension fund, the government-backed National Employment Savings Trust (Nest) scheme, with nine million members, agreed to start divesting from fossil fuels by banning investments in any companies involved in coal mining, oil from tar sands and arctic drilling and moving £5.5bn into “climate aware” investments.

FFO has been active for over five years and it is the dedication of a few hard-working members that has resulted in this breakthrough in Oxfordshire. Founded by Al Chisholm, a local resident living in Rose Hill, the group comprises members from around the county with wide-ranging expertise including technical, campaigning, finance and negotiating skills. If you would like to join the group -and we are especially looking for those with investment experience and social media skills at present – please contact us at fossilfreeoxon@gmail.

Help kick fossil fuel out of local government pension scheme – action needed by 15th May 2020! Please respond to the council’s consultation on Oxfordshire Pension Scheme’s Climate Change Policy

With a quick email action, you can help push for a Climate Change Policy with teeth that will have a real impact on how public pension money is invested.

How to respond to the consultation: The short version

Responses should be sent by email to sean.collins@oxfordshire.gov.uk, stating whether you are responding as an Oxfordshire tax-payer or as an LGPS member.

There is more detail on the Climate Change Policy and consultation process in the long version below but, if you are pushed for time, below are key points you could usefully make in your response to the consultation, if you agree with them.

1.We ask that the Pension Fund’s investments be aligned with the Paris Agreement’s aim to keep global temperature rise below 2 degrees C and as close as possible to 1.5 degrees rather than consistent with governments’ Paris pledges which are predicted to produce unsafe temperature rises of 2.9 degrees or more.

2. We ask that the Fund divests from (sell all shares in) all fossil fuel companies which continue to extract further fossil fuel reserves because 

a) fossil fuel companies that are driving the climate crisis so public money should not be invested in them

b) divestment sends a clear message to governments and to the companies themselves that driving the climate crisis is morally unacceptable, so fits with the Fund’s stated goal to “influence policy in the climate change arena” 

c) divestment would protect the fund from the well-documented risk of falling share value.

3. We ask that the Fund supports engagement (using investors’ position as shareholders to push for change) with non-fossil fuel companies, aimed at aligning their business with below 2 degrees warming.

4. Clear and measurable criteria are needed to assess companies’ alignment with a less than 2 degrees scenario. The climate change policy needs to be clearly enforced and actioned by these inclusion/exclusion criteria.

 

The longer version

Oxfordshire Local Government Pension Fund has made great strides in developing a  Climate Change Policy that recognises a need for the Pension Fund to align its investments with the Paris Agreement and its ambition to limit global warming to well below 2 degrees C. The draft policy is out for consultation until 15th May, and you can respond by emailing Sean.Collins@oxfordshire.gov.uk.

We at Fossil Free Oxfordshire are broadly in agreement with the stated aims of the Policy, but have concerns about some crucial details.  We encourage our supporters to respond to the consultation, and in this blog we offer our views on what a response might include. The consultation document details how to respond, and invites comments on the following issues (see paragraph 23 of the consultation document).  Fossil Free Oxfordshire’s views on these are shown in italics below each point.

  • The use of the Paris Agreement to act as the guiding principle for the Climate Change Policy. Are there alternative strategic drivers better suited?

We support the use of the Paris Agreement to act as the guiding principle for the Climate Change Policy.  However we think that the pension fund needs to be very clear that the objective of the fund is to be compliant with the objectives of the Paris agreement i.e. consistent with limiting global heating to less than 2C rather than just consistent with the current government pledges under the Paris Agreement which scientists believe will result in unsafe heating of between 2.9C and 3.4C [1]. This principle places limits on the use of many investment vehicles by the pension fund.

  • The decision not to include any blanket divestment statements within the Policy but to focus on a practice of engagement and selective divestment across all asset classes and sectors where sufficient evidence of compliance with the Paris Agreement is not forthcoming.

We agree that engagement and divestment are not mutually exclusive – indeed they are intrinsically interlinked.  Engagement must be underpinned with clear criteria, metrics, timelines and the sanction of divestment for companies whose performance does not meet stated criteria within the timeline. Otherwise it acts as an excuse for the same stalling and greenwash we have seen from oil companies for decades, and which has led organisations such as the National Trust to divest.

A divestment policy applied to the fossil fuel industry would be powerful in the following two respects:

  1. It would align the fund with the values of pension scheme members who have principled moral objections to the actions of the fossil fuel industry which has done, and continues to do, unequivocal harm to the world. The Unison survey suggested LGPS members object in principle to their pension being invested in unethical industries.
  2.  It would align with the Fund’s goal to “influence policy in the climate change arena” by stigmatising the fossil fuel industry, undermining its social license to practice and encouraging government to strengthen legislation against it.

Engagement can be a highly effective approach with companies whose business models can be adapted to respond to the climate crisis. We agree that it is not too late for some companies who are not currently aligned with a 2 degrees scenario to adapt.   

However, any companies whose business plans include continued exploration and extraction of new reserves of fossil fuels could not be said to meet any reasonable criteria for 2 degree-compliance. Any engagement process that employed credible criteria would surely exclude such companies. Any engagement/divestment policy that does not lead to their exclusion in the very near term, is self-evidently inadequate.

  •    Whether the focus on climate change risks relative to the other risks facing the pension fund is appropriate, and whether there should be greater emphasis on any of the other UN Sustainable Development Goals or risks.

We think that climate change poses by far the most significant set of risks to the pension fund, so the focus on that is appropriate. We recognise that there are also other risks that should be considered, but that the main emphasis should remain on climate change.

  • Potential metrics to be included in any future iterations of the Investment Strategy Statement and Climate Change Policy against which compliance can be assessed.

The Church of England Commission used the Transition Pathway Initiative’s assessment of the energy sector which led to immediate divestment from all but two fossil fuel companies.  We would support such divestment by the Oxfordshire as a first step towards an investment policy which will eventually be consistent with limiting global heating to less than 2 degrees C.  (Further steps to divest fully from fossil fuel companies would be required at a later stage given none has a business plan consistent with that objective.)  

 [1] https://www.theguardian.com/environment/2019/sep/23/countries-must-triple-climate-emissions-targets-to-limit-global-heating-to-2c

Progress towards Divestment in Oxfordshire – next step Brunel

Some good news from Fossil Free Oxfordshire, the Oxfordshire local government pension fund divestment campaign. The Conservative Party-dominated Oxfordshire Pension Fund committee now appears ready to move more of its pension fund assets into carbon-emission friendly funds at its next asset allocation meeting, which is a significant step toward divestment.

This sea change in attitude came after a Climate Change Workshop was held on 8th November 2019 to discuss how the Oxfordshire Pension Fund could play a part in tackling the climate crisis. The meeting included the Oxfordshire Pension Fund committee and board members, senior Brunel Pension Partnership executives, fund managers with expertise in low carbon funds, a leading climate scientist, an Oxford University student climate campaign representative, Oxfordshire District councillors holding senior environment positions and members of Fossil Free Oxfordshire. This all came about through the unrelenting pressure Fossil Free Oxfordshire has put on the Oxfordshire Pension Fund committee and County Council over the last few years.

The consensus achieved at the workshop was positive. All participants agreed that the Pension Fund should support the Paris Agreement goal of limiting global warming to 2 degrees. Moreover, the fund management representatives who spoke at the workshop assured participants that Pension Fund performance would not be affected if assets were transferred into zero or low carbon investment funds; indeed, they argued that a move away from fossil fuels could be a source of superior Pension Fund returns.

Even more encouraging, a working group is being set up to incorporate the Climate Workshop’s conclusions into the Pension Fund’s new Investment Strategy Statement to be published in March 2020, and Fossil Free Oxfordshire has been invited to be a part of that group. This, we believe, will allow the divestment agenda to have a major impact on the allocation of the Pension Fund’s assets going forward.

While this is real progress, a lot more has to be done, and we need your help. Under a central Government directive, local government pension funds are being required to pool their assets. Most of Oxfordshire Pension Fund’s assets are to be managed by the Brunel Pension Partnership, along with the assets of Avon, Buckinghamshire, Cornwall, Devon, Dorset, the Environment Agency, Gloucestershire, Somerset and Wiltshire. Accordingly, we urge all local environmental and climate groups within the Brunel region to pressure their local pension funds to recognise the climate emergency and allocate their pension fund assets accordingly.

We realise, nonetheless, that mounting a divestment campaign can be quite daunting, as a starting point you could review the Climate Workshop briefing document that supported our campaign. We hope that this report will give you valuable information in helping to persuade your local government pension fund to play its part in fighting the climate crisis.

If you have any questions or comments please do not hesitate to get in touch on fossilfreeoxon@gmail.com

Oxfordshire council takes important step towards possible divestment

Oxfordshire County Council Pension Fund Committee meeting on Friday 7th June made some significant decisions that could lead to divestment from fossil fuel companies. For the first time there was substantial debate about the merits of divestment.  

The public gallery was packed with people who came to support councillors and campaigners speaking in favour of divestment.  The committee members certainly behaved as if they had an audience and this clearly focused their minds on the many problems with investing in fossil fuel companies.  The campaign is grateful for this support.

As part of the campaign’s  lobbying effort Julia Spragg (a long standing campaign member), Jess Mallighan and Xanthe Wells (school students) spoke to the committee in favour of divestment at the meeting.  Jess and Xanthe were particularly inspiring and received a well deserved standing ovation from some of the committee members and the public gallery.

JessJulia&XantheJune2019

Campaign speakers (left to right):
Jess Mallighan, Julia Spragg, and Xanthe Wells

 

Jess’ and Xanthe’s speech challenged the Pension Fund Committee, saying:

“I found out that you still invest millions of pounds of the pension fund into fossil fuels. and it made us think, what does acting on the climate emergency really mean to you? If you actually believed in the climate emergency and wanted to take action you would definitely not invest in companies like BP or Shell, who are still spending money looking for new oil and gas to dig up.”

The committee has decided to hold a workshop on climate change risk policy in the autumn which will develop an approach to climate risk that includes “decarbonising the listed portfolios, and developing measurable objectives and targets”.  The chair of the committee has invited Jess and Xanthe to participate in the workshop which will help ensure that divestment is taken seriously. The workshop organizers “will seek participation from a wide range of stakeholders to ensure a balanced discussion”.  We hope this means that ethical and financial arguments against continued investment in fossil fuel companies are properly reviewed.

It appears that workshop was placed on the agenda through the efforts of Councillor Mark Lygo (Labour) in his “pre-meeting” with the committee chair Councillor Kevin Bulmer (Conservative).  The other opposition Councillors addressed divestment in other ways. Councillor John Sanders (Labour) proposed a divestment motion “to instruct officers to investigate the best possible way it can divest itself of all fossil fuel investments (i.e. the equity or bond of any company which derives more than 50% of its total turnover from the extraction and production of fossil fuels) as soon as is reasonably practicable”.  This motion was supported by all three opposition councillors. However, the motion was not carried as all the Conservative councillors voted against the motion.

John Sanders gave a forceful speech in favour of his motion very much in line with the Fossil Free Oxfordshire campaign.  He said that fiduciary duty does not mean inertia and has not stopped other councils from divesting. He said, or implied, that the outcomes from engaging with fossil fuel companies were not substantive, and that engagement needs to demonstrate results and needs to be backed up with the divestment stick of “do this or else…”.

One of the objectives of the Fossil Free Oxfordshire campaign is to persuade the committee to move a substantial proportion of its investments into available funds that already have a reduced exposure to fossil fuel companies.  The council has relatively recently started the process of changing the structure of its investments so that a “pooling” company called Brunel Pension Partnership will manage those investments for Oxfordshire council along with councils across the South West of England.  Brunel offers a Low Carbon fund and a Sustainable fund both of which have a lower exposure to fossil fuel investments. Councillor Roz Smith (Liberal Democrat) persistently asked why the fund has not invested in these funds. She requested that a discussion of this issue should be on the committee’s agenda at a future meeting.  This was the first time that this important issue has been raised at pension fund committee meeting.

The meeting represented a major step forward for Fossil Free Oxfordshire, the result of concerted campaigning over a number of years.   The campaign now needs to ensure that the debate about divestment at the committee’s climate risk workshop in the autumn is substantial and results in a clear commitment to substantially reduce or eliminate the Oxfordshire fund’s investments in fossil fuel companies.

Calling all Oxfordshire Local Government Pension Scheme members! Write to your MP about divestment.

Do you agree it’s time your pension stopped fuelling climate breakdown through its investments in fossil fuel companies?  We at Fossil Free Oxfordshire have been telling the Pension Fund Committee this for a long time, as have the 1,200 people who signed the petition and about 200 LGPS members who wrote to the (former) Chair of the Pension Fund Committee.

Other LGPSs have committed to divest, like Waltham Forest and Islington, and so have the whole of Ireland and New York! But Oxfordshire Pension Fund Committee has not budged on this issue so it’s time to push the campaign up a notch, and we need your help.

You can quickly and easily take action by asking your MP to push for your pension fund to be divested from fossil fuels. We’ve created a template email and listed the Oxfordshire MPs’ email addresses below.

Thank you very much for your support!

PS It would help us if you would cc/bcc or forward your email to fossilfreeoxon@gmail.com.

 

Template email to MP

Dear [MP’s name],

I am an Oxfordshire Local Government Pension Scheme (LGPS) member. I understand a percentage of our pension pot is invested in fossil fuel companies.

I am very concerned that my pension is fuelling climate breakdown through being invested in fossil fuel companies. I’m also worried that these are unsafe financial investments because renewable energy is becoming cheaper.

Taking action against climate change is now urgent, as climate scientists have made clear (e.g. recent IPCC report from October this year “Global warming of 1.5 degrees”)

The Oxfordshire Pension Fund Committee has not responded to sustained calls to move our investments out of fossil fuels, even though climate risk is noted in the Investment Strategy Statement. A mechanism to take our money out of fossil fuel companies has been made available by the Brunel Pension Partnership. So there is no reason to delay.

Please would you, as my MP, take up my concerns with Cllr Kevin Bulmer, chair of the Pension Fund Committee and push for the fund to be made completely fossil fuel-free as soon as possible. I would like to see concrete action in time to be reported at the Committee’s meeting in March 2019.

Yours sincerely,

It’s important to include

· your full name
· your postal address, including postcode
· your contact number(s)

Oxfordshire MPs’ email addresses

If you’re not sure who your MP is, you can check by putting your postcode in here.

Anneliese Dodds (MP for Oxford East) anneliesedoddsmp@gmail.com

Layla Moran (MP for Oxford West and Abingdon) layla.moran.mp@parliament.uk

Victoria Prentis (MP for North Oxfordshire) victoria.prentis.mp@parliament.uk

Ed Vaizey (MP for Wantage & Didcot) vaizeye@parliament.uk

John Howell (MP for Henley) howelljm@parliament.uk

Robert Courts (MP for Witney & West Oxfordshire) robert@robertcourts.co.uk

 

Environmental, Social and Governance issues take centre stage at Oxon County Council!

At this week’s meeting of the Oxfordshire County Council we think there’s been a major shift in the attitude to Environmental, Social and Governance (ESG) issues and investment amongst the Councillors.

We knew that a Lib Dem Cllr, Bob Johnston, was putting a motion to the full Council today about ESG issues and Council investments. He reports to the PFC from the Pension Board, so we’ve seen a lot of each other over the last few years at PFC meetings! One of our supporters is his constituent and went to lobby him – and found out about the motion.

So we decided to do what we could to support the motion. We lobbied other Councillors who we thought would be supportive – Labour Councillors – and Andrew Finney organised giving a public address at the Council meeting, before the motion was proposed.

One of the Labour Councillor asked to support the motion told us before the meeting:

“Absolutely it’ll have my full support and that of the County Labour Group. I think unfortunately it may be voted down by the Conservatives but hopefully I’ll be proved wrong!”

Andrew Finney gave a 5 minute public address to the Council for Fossil Free Oxfordshire in which he spelled out some pertinent information:

  • Why it was important that the Council’s actions started to reflect the new ESG statement adopted last March that recognised risk due to climate change
  • That the Pensions Minister, Guy Opperman, has told the Commons environmental and audit committee this month that many trustees are failing to fulfil their duty to consider climate risk
  • Why continuing to invest £20 million directly in Shell is a mistake and why it is a fallacious argument (put to us by the Pension Fund Committee in the past) that investing in Shell is a way of supporting renewables
  • That Lancashire County Council Pension Fund invested £12 million in the Westmill Solar Farm in Oxfordshire in 2013

Andrew Finney urged the Council to ask the Pension Fund Committee to commit to a fossil free strategy as it enters the new Brunel Partnership and select low carbon options.

Cllr Bob Johnson’s motion was:

“Investment, environmental, social and governance (ESG) issues are now rising rapidly up the Agenda. This is evidenced, for example by the recent decision of the Norwegian Sovereign Wealth Fund to cease investment in oil and gas. The Oxfordshire Local Pension Fund has an obligation to review its investment strategy, when the present 3-year framework expires. Council therefore calls upon the Pension Committee to incorporate the latest and best advice available on ESG matters when reviewing its policies and drawing up the next 3-year investment strategy.”

The big news is that the motion got passed unanimously – of 60 Cllrs present, 59 Yes, 1 Abstention. That’s a lot of Tory Cllrs deciding to take ESG issues seriously.

At the PFC June meeting Cllrs will review ESG issues and investment strategy, so we’re very hopeful for some real movement – from Conservative Cllrs!

VOLUNTARY SOCIAL MEDIA ROLE WITH FOSSIL FREE OXFORDSHIRE

Passionate about fighting climate change?
Know your way around social media?
Want to get involved in campaigning?

We’re looking for someone to take control of our social media to support the work we do; pushing Oxfordshire County Council to divest from fossil fuels. The Council currently invests a portion of its pension fund in companies that profit from environmental destruction. We think this must stop. If you think so too and you know your Twitter from your Instagram then why not help us put an end to the funding of fossil fuels in Oxfordshire?

We need help with:

– Keeping our Facebook page and Twitter feed up to date – posting about news and upcoming events, developments in the campaign and blog posts
– Managing our blog – editing and uploading posts and generating content
– Creating photos and images for use on social media and elsewhere in the campaign
– Increasing our social media presence and reach
– Supporting the campaign in general and attending regular fortnightly meetings

Get in touch with us if you’re interested in getting involved at fossilfreeoxon@gmail.com.

NB None of us at Fossil Free Oxfordshire are paid, and you would be no exception 🙂 We do it because we think it’s important and it’s fun!