Hackney Council has announced it will be reviewing its £42m investment in fossil fuels.
The investment in fossil fuel companies like Shell and BP is held through the pension schemes of teachers, social workers and council employees.
Following increasing pressure from local climate change campaigners, the council has agreed to discuss the long-term financial impact of investing in fossil fuels.
Chair of Hackney Council’s pension committee Cllr Robert Chapman told the Hackney Citizen these discussions would take place “in the context of the legal requirements and the fiduciary responsibilities we have to our fund members.”
Cllr Chapman said the council is “aware of public concern” surrounding the divestment debate and that it recognises “there would appear to be increasing evidence of the damaging impacts that fossil fuels can have on the environment”.
He added that the council is preparing a “comprehensive paper” which will help to “generate the discussion around the long-term investment in fossil fuels”.
The announcement comes as mass data released by a group of climate change organisations reveals that overall 192 councils in the UK have £14 billion invested in fossil fuels via their pension funds.
Chris Venables from Divest Hackney, the campaign group set up to lobby the council to divest from dirty energy, welcomed the council’s announcement. “To our knowledge, Hackney will become only the third local authority to review its fossil fuel investments.”
“We hope that Hackney Council will be transparent about the review process, and will invite submission from the community, including from Divest Hackney.”
In order for the review to be effective, said Venables, it would need to model how divestment would affect the performance of the fund, be informed by the “latest thinking” and be based on an accurate understanding of the fund’s legal duties.
“Most fund members and taxpayers won’t be happy to learn that their money is funding climate change,” he added.
The pension fund states it “will not actively disinvest in companies for ethical, social or environmental reasons as this may impact on fund returns.”
Concerns were raised in a recent pension committee meeting that fund managers previously voted against the environmental recommendations of the Local Authority Pension Fund Forum.
A debate will held at the Arcola Theatre on 1 November at 4pm with local representatives, activists, climate scientists and financial experts giving Hackney residents the chance to learn more about fossil fuel divestment./ 24 September, 2015