Bill Moyers talks divestment for funders with Ellen Dorsey of the Wallace Global Fund and Thomas Van Dyck of RBC Wealth Management.
It’s no great surprise that funders have taken up the fossil fuel divestment cause. For many, unloading these stocks and investing in positive social and environmental projects goes hand-in-hand with good grantmaking.
Nearly 50 foundations have pledged to divest from fossil fuels, totaling over $4 billion in holdings. And that doesn’t include the growing list of individual investors, municipalities, universities, and faith communities that have joined the movement. Not only does divestment send a message in the face of growing climate impacts, it’s increasingly a smart financial move as well.
As environmental funders, a number of Rachel’s Network members have made a commitment to divest from fossil fuels, both personally and through the foundations they direct. As we celebrate Global Divestment Day, they offer tips for those ready to move their money.
“The first step is to really look at and know what you own,” says Cari Rudd, pointing to this list of the world’s top 200 publicly traded companies ranked by the carbon content of their fossil fuel reserves. “The most important thing to know is that it isn’t as complicated or intimidating as you might think,” she says
Divesting Mutual Funds
Even if you invest primarily in mutual funds, As You Sow has you covered. Their forthcoming online tool, fossilfreefunds.org, will illuminate various funds’ carbon impact. The website was supported by several Rachel’s Network members.
Abi Rome is turning her mutual funds into donations: “I have a couple of mutual funds that are not fossil-free, and I’m ridding myself of them by transferring shares to charitable organizations,” she says.
Finding a Financial Adviser
Abi started divesting from fossil fuels 25 years ago, thanks in part to finding a financial adviser who understood her vision.
“My adviser was one of the early socially responsible investing (SRI) money managers. Ever since I’ve been working with him we’ve discussed my screens and the pros and cons of potential investments,” says Abi. When the Divest-Invest movement began, she was delighted to see that most of her portfolio was already fossil-free, and doing well.
Today, there are hundreds of advisers who specialize in SRI. The Forum for Sustainable and Responsible Investment and Calvert’s Advisor Finder Service offer directories of advisers, and Fossil Free connects visitors to their website with financial mentors.
Annarie Lyles has chosen to stick it out with her existing adviser at a large bank, with the intention of changing minds from within. “I’m trying to get my investment adviser to shift towards a more values-aligned strategy that includes things with positive environmental impacts,” says Annarie.
Divesting a Foundation
Divesting your private investments is one thing. Getting a foundation or organization you manage to divest takes more muscle and willpower.
The Park Foundation, led by Adelaide Park Gomer, was one of the first foundations to sign the Divest–Invest Pledge. As a signatory, the foundation has divested its portfolio of the “Carbon 200” stocks.
Getting this commitment from the foundation’s board didn’t happen overnight. Adelaide spent a decade inviting SRI experts – Jed Emerson, Caroline Williams, David Blood, and others – to make presentations at board meetings. Eventually, the board saw the benefits of screening its portfolio and the results have been positive on multiple fronts. “We have not sacrificed meeting our fiduciary responsibility for risk/return,” says Adelaide. “We see performance and responsible investing as going hand-in-hand.”
Reinvesting in a Sustainable Future
There are many ways to support a sustainable future. The nonprofit Ceres, for example, is building a movement to invest trillions of dollars in clean energy.
“Many carbon-free assets are currently outperforming the general market,” says Lisa Renstrom. “This is partly because these businesses are often grounded in disruptive technology, giving them the potential for rapid growth. There is a growing array of fossil-free alternatives for investors who opt to put their money behind the transition to a new-energy economy.”
Still have questions? Read these extended Q&As with Rachel’s Network members and friends:
Expert Q&A with Lisa Renstrom, Divest-Invest Philanthropy
Getting Started in Impact Investing with Annarie Lyles
Adelaide Park Gomer on Mission-Related Investing
Expert Q&A with Andrew Behar, As You Sow
Rachel’s Network is not an investment adviser, nor should this information be construed as investment advice. Please consult with your financial adviser before making any investment decisions.