Why the council pension fund I chair is divesting £1.2bn out of fossil fuels

Local authorities invest £16bn in fossil fuel companies. In Southwark, we will no longer do this – writes Cllr Fiona Colley, Chair of Southwark’s pension fund

Data released on 9 November shows that the UK’s local authorities invest more than £16bn into companies that extract oil, gas and coal. Collectively, the country’s local government pension funds have nearly £3,000 invested in fossil fuels for every pension fund member. Southwark has decided we will no longer do this.

In December 2016, Southwark council pension fund made a landmark commitment. Following more than a year of consultation, deliberation and work with community groups we announced a decision to divest the £1.2bn fund from fossil fuels.

This was a decision based not just on our political and ethical concerns, but primarily on our belief that climate change and significant investments in fossil fuels present a long term financial risk to our fund. We are clear that our action to reduce the carbon exposure of our fund is wholly consistent with our fiduciary duties as pension fund trustees. This move was not taken lightly, but we believe it is the right way forward. By backing divestment, councils can show leadership on climate change, protect public sector workers from long-term financial risk and seize the opportunity to invest in sustainable communities and the transition to a low carbon economy.