Quakers and disinvestment
The Quaker movement has long been concerned with environmental issues, but members’ thinking on the impact of their investments took several years to develop.
It seemed clear to many members from about 2011 that the movement should make a corporate commitment to become a low carbon, sustainable community. But change didn’t begin until 2013, by which time the Quakers had begun to make progress on lowering their own carbon footprint.
By that time the science was clear that if internationally-set targets on reducing carbon emissions were to be met, 80 percent of fossil fuels needed to stay in the ground. Why, then, asked Quakers, were their central funds still partly invested in companies that made or processed fossil fuels?
Withdrawing investments from the fossil fuel sector was a drawn-out debate for the Quakers Picture: Pixabay/J Penrose
Explains Suzanne Ismail, head of networking and engagement for Quaker Peace and Social Witness, Quakers in Britain: 'At the time, our investment portfolio, which is mostly in equities, was worth about £21 million and just under four per cent of that was invested in fossil fuel companies, particularly Statoil and BG Group, and they were very much the best in their sector on carbon issues at that time – but those holdings were a real tension for us.'
The trustees of the Quaker investment portfolio consulted members of the movement, and took advice from their own investment committee, and external investment managers. They came up with three options:
Continuing to invest in fossil fuels, but with a 'best-in-sector approach', trying to influence fossil fuel companies to improve their transition plan.
To restrict investment to the lowest-carbon, least damaging fossil fuels, such as gas production.
To fully divest from fossil fuel companies.
The trustees were exposed to a wide range of views, some pointing out the financial risks if the Quakers were to restrict their investments to rule out whole sectors of the market. But in the end, they went for the third option – to end investment in all fossil fuels.
'This was absolutely the right thing for us to do, even if it meant the possibility of some potential extra financial risks' – Suzanne Ismail
'By the end of it, there was a really strong feeling through our community and throughout all of those different structures and committees, that this was absolutely the right thing for us to do, even if it meant the possibility of some potential extra financial risks,' said Suzanne.
Investments in oil and gas companies were replaced by taking stakes in renewable energy companies – still in the financial mainstream, in equities that were easily tradable on the main British exchanges.
The result? Approval from the majority of Quaker members who, Suzanne said, felt 'that this was something that Quakers were really called to do at that particular point in time'.
There was no monetary loss, either: financially, the portfolio has held up well in comparison to others.
The Quakers’ climate-friendly investment policy is now common practice among socially-conscious organisations of all kinds. It helped to inspire other UK churches to make similar moves, and the Quakers have worked with ECCR or Ecumenical Council for Corporate Responsibility – a charity supporting UK churches to make ethical investment decisions.
The project has also reverberated at a local level: 'That approach certainly helped Quaker communities at local and regional level make their own decisions around investments and their own approach to fossil fuels,' said Suzanne. 'We found that although the willingness was there, people needed a little bit of a nudge and help and a framework to start thinking about those kind of conversations.'
• This article is drawn from a Faith Plans Webinar on Financial Assets. CLICK HERE to watch the recorded discussions and to find out more information.