Fossil Fuel Divestment
Divestment has been common across recent history. In fact, one of the most successful and impactful divestment efforts was to end the South Africa Apartheid in the 1960s, the system of racial segregation established by the government comprised of all white people in 1948. The Apartheid was established so that the white minority could maintain their domination in all aspects of the country. Students across the United States came together by pressuring universities to divest from companies that ran their business in South Africa. The combination of boycotts within the country and other nations across the globe resulted in economic failure. Thus, the Apartheid government collapsed by the early 1990s.
What is divesting?
So, what is divestment? Divestment is the process of removing stocks, bonds, or investment funds that are usually unethical to achieve social or financial goals. Essentially, divestment is the opposite of an investment. When the public demands social change, divestment is a powerful tool to utilize, as people can pressure large institutions - such as investors, universities, pension funds, and charitable foundations - to withdraw their financial support from unethical companies. In recent years, divestment has become popular to end the fossil fuel industry.
Cons of Fossil Fuels
Although fossil fuels make life convenient, it also has numerous negative consequences that make a significant impact across the globe. Human health and safety are at risk as carbon dioxide and other greenhouse gasses (e.g methane and nitrous oxide) are emitted when burning fossil fuels such as coal, oil, and natural gas. In fact, the Center for Research on Energy and Clean Air (CREA) and Greenpeace Southeast Asia published a report which stated that an estimated amount of 4.5 million people die annually due to air pollution across the globe. Additionally, another article states that exposure to particulate matter (PM2.5) causes 40,000 children to pass away before they turn five years old.
Furthermore, particulate matter (PM2.5), can cause lung irritation, shortness of breath, and even chronic bronchitis. Additionally, the increased concentrations of carbon dioxide and methane cause global warming, a gradual increase in temperature, and shifts in weather patterns across the globe. Climate change negatively impacts multiple aspects of daily life, such as growing food and access to water.
How Divesting Can Help
As a result, people are coming together to stop the production of fossil fuels by requesting larger institutions to stop their financial support of fossil fuel companies. Thus, the fossil fuel divestment campaign is formed. According to a study conducted at Oxford University, this campaign is growing rapidly, faster than any other campaign in history. Globally, about 1,526 institutions are currently divesting such as Harvard University, Oxford University, LA Banque Postale, and more. As the horrors of fossil fuels are highlighted, the public stigmatizes the usage and support of fossil fuels and questions whether fossil fuels are necessary, leading investors and executives to stray away from being those companies.
The desired outcome of this movement is to completely stop the reliance on fossil fuels and transition to using green energy only. Institutions generally are divesting by withdrawing their investments from fossil fuel companies that do uphold standards that work toward reducing the effects of climate change. Yale, for example, created a list of certain principles they will not support. Using that list, they removed their investments from multiple companies that align with those principles.
Individuals, on the other hand, have been investigating a strategy of short-selling stocks, a method where an individual borrows shares from a broker and sells it when that person believes the stock will go down. If a large number of people commit to this strategy, fossil fuel companies will be negatively impacted; however, there won’t be much of an impact if only a small group of people short-sell fossil fuel stocks.
Conclusion
All in all, the fossil fuel divestment movement is rapidly growing and making a significant impact on the fossil fuel industry. It is important to recognize that excessive fossil fuel usage harms the world rather than helps, as it causes frequent natural disasters, food shortages, air pollution, etc. Becoming independent from fossil fuels is critical for the health of the planet and all living beings.