Divestment — when an individual investor or institutional fund (a university’s endowment, a government’s pension fund) decides to pull their stocks and bonds from a company or type of business based on socially responsible investing principles — was most famously and effectively used in the anti-apartheid movement in South Africa in the ’70s and ’80s and again, more recently, to fight genocide in Sudan.
The idea behind the movement is to shift money from Big Oil, Big Coal, and Big Gas to places where it can do some good, or at least not cause our own destruction. When enough big funds divest, companies like BP and Exxon will feel the impact on their share prices.
But it’s bigger than stock prices. Divestment is also an education and public relations tactic that’s not so easy for the fossil fuel industry to drown out with money. It’s a grassroots movement spreading virally on social media and across the country on college campuses.
Which brings us back to the Providence City Council, where councilman Yurdin explains it well. “To successfully tackle the problem, it’s going to require unprecedented efforts — political and cultural,” he says. “Fossil fuel divestment plays a critical part — targeting the political power of industries that work to block reforms. It also provides a focus for activists and other individuals to organize around. To solve any big problem, people need to figure out a series of small steps to tackle it and start making progress. Divestment is one of those steps.
Following Thursday’s successful 11-1 vote, Providence joins 17 other cities, towns, or counties; 15 other large organizations; and six colleges around the country that have made a commitment to fossil fuel divestment since the movement was launched by writer and founder of 350.org Bill McKibben last fall. At this rate, it won’t take long until the combined funds of these institutions start adding up to real money.
Officials often tell me they’d go for divestment if there were investment fund managers around to execute such a strategy at a large enough scale. My response? The more institutions and individuals who make the commitment, the greater the demand for such fund managers will grow. With billions of dollars on the line, they won’t be lacking long.
And then there’s the PR angle. If the divestment movement succeeds in reminding investors of the villainy of the fossil fuel industry, other tactics in the fight for a stable climate will become more effective. Politicians in Washington may even gain enough courage to do what’s right for the future of the country and the world.
We may be 25 years late, but there is still time to act. You can join Fossil Free RI in calling on URI, RIC, and CCRI to divest. You can consider divesting yourself and encourage your church or business to do so as well.
And now that Providence has made a huge step in the right direction, let’s ask the whole state of Rhode Island to dump its fossil fuel holdings and to invest in something wiser than self-destruction.
We would be the first state in the nation to do so, and that would be an even bigger frackin’ deal.
Abel Collins is program manager for the Rhode Island chapter of the Sierra Club and a founding member of Fossil Free RI. He ran for US Representative in 2012.