THE second debate on climate change focused on the C of E’s investment policy.
Introducing the debate, the Bishop of Manchester, the Rt Revd David Walker, a member of the Ethical Investment Advisory Group and Governor of the Church Commissioners, spoke about “the importance and urgency of climate change as an ethical-investment issue”, “why the climate-change policy adopted by the national investing bodies [NIBs] [was] the right one”, and “the importance of strong and unified affirmation of the new policy by Synod”.
On his second point, he said that the question was “not whether climate change is an important and urgent ethical-investment issue, but how to reflect this importance and urgency in ethical-investment policy”.
The EIAG’s “independent and authoritative ethical-investment advice” was “formed by biblical understanding, theological reflection, and an appreciation of the views of the Church”. It was “without exception, extraordinarily well-considered and distinctly Anglican”.
EIAG’s new climate-change policy was adopted by the trustees of all three NIBs in April. They had already been working on it before a motion from Southwark diocesan synod called for “an ambitious policy aligned with the Church’s ‘theological, moral and social priorities’”.
He said that, with the recent disinvestment from thermal-coal and tar-sands companies, “the Church Commissioners and Pensions Board have sent a prophetic signal, picked up across the world, that there is an urgent need to move away from fossil fuels — starting with the dirtiest — and to transition to a low-carbon economy.
“The beauty of the policy recommended by the EIAG, however, is that it is not all about divestment. It is also about engagement with the companies who play a large part in determining whether the energy transition takes place.”
Dr Anna Thomas-Betts (Oxford) urged that investment into renewables needed to go not only to companies, but also to universities.
William Seddon (St Albans) cited an example of mining firms that were concerned that public opinion was turning against them, and so opened a channel of communication with church investment bodies that had challenged them.
“A channel has been established in which the light of theological reflection is shone on the business,” he said. “This would not have happened had we disinvested.”
Prebendary Stephen Lynas (Bath & Wells) said that the issue was not as simple and easy as some would assume. He spoke of how a proliferation of solar farms in his part of Somerset had overtaken food farming, because it was subsidised by the Government. “I don’t think I’m a NIMBY,” he said. But “we must not pretend this is all about being green. We have to decide if we want to secure a food stream or a proliferation of subsidised stuff.”
The Bishop of Blackburn, the Rt Revd Julian Henderson, spoke about fracking applications in Lancashire. He disagreed with the EIAG’s position that exploration for shale gas should not lead to a presumption of extraction.
He thought that exploration was bound to lead to extraction if gas was found. He also urged the imposition of an independent regulatory system to be imposed rather than reliance on self-regulation by the fracking companies.
The Revd Hugh Lee (Oxford) moved an amendment adding to clause (c) of the motion that the NIBs use the “threat of disinvestment from oil companies within three years unless they have committed to ceasing oil exploration and reducing production consistently with limiting the global temperature rise to two degrees Celsius”.
He had earned his living in fossil-fuel companies for 48 years, and had been an economist in energy for 20 years until 1998. He was delighted with the new policy of the EIAG, but said that oil companies were different from those in coal and tar sands: “We need them with their vast experience and money to save the planet.” These companies were still spending billions on exploring new fossil-fuel reserves. Engagement could work, but it would be necessary to tell them that “they have only got three years.”
Bishop Walker did not support this motion. Oil exploration was “not in itself inconsistent with reducing warming to two degrees”. It was more a question whether or not to bring what was discovered into production. “We can’t expect oil companies to reduce production now.”
Clive Scowen (London) found the notion of the threat of disinvestment “rather peculiar”, especially when talking about oil companies, which “like nothing better than be shot of troublesome activist shareholders. It will not leave the boards of BP and Shell quaking in their boots, but singing in their bars.”
The way to reduce extraction was to reduce demand, which would require “major investment in alternative sources of energy and in ever more efficient ways of burning it. . . We need to use our influences and shareholders in major oil companies to press them to use their profits to make investments that nobody else is going to make.”
Janet Appleby (Newcastle) supported the amendment. “Surely the threat of disinvestment will only be taken seriously if it is time-limited and specific.”
April Alexander (Southwark) said that “the ethical dimension is a primary one.” Once that had been decided by the EIAG, it was open to “the assets committee to make investment decisions within that remit”.
On a show of hands, the amendment was lost.
Speaking to another amendment, Canon Chris Sugden (Oxford) spoke about the need for energy in the developing world. “Switching to low-carbon economies will require investments of billions of pounds. Most governments are too short-term to do it. It can only be done by the energy companies.”
John Freeman (Chester) recommended that it was time to “put our backs into solar energy”. The sun had the power to supply all energy needs if there was enough research in capture and storage.
Gavin Oldham (Oxford) said that the “best chance” of restricting the rise in global temperatures was if “energy that does not harm the environment” was “cheaper than energy which does”.
Speaking to her amendment, Canon Catherine Grylls (Birmingham) described it as being designed to “affirm, draw attention to, and encourage substantial action” on renewable energy and other low-carbon energy sectors, as part of the climate-change policy.
Speaking to his amendment, Canon Giles Goddard (Southwark) said that one crucial question that had not been raised during the debate was how they knew when the engagement by the NIBs had been effective. He wanted the EIAG to publish its investment framework so that the Synod could know what the targets were.
After the movers of the various amendments had spoken to, but not moved, their amendments, a general debate continued.
The Revd Professor Richard Burridge (London University) made his last speech to Synod. He wanted to draw attention to the theology of “living between the times”: “It’s about relationships and engagement rather than a list of demands. Jesus gives us a direction rather than directives.” There was only one criterion to disinvest: “when they are not listening any longer”.
This had been the case with SOCO, Vendanta, and News Corp. He gave the example of Zacchaeus, to whom Jesus had said “Go and put the kettle on.” He said that salvation had come to his house, despite the fact that he had not given everything away. “It’s an ongoing change.”
Elliot Swattridge (Youth Council) felt compelled to question the ten-per-cent threshold on the revenue that could be generated by coal and tar sands. “I remain uncomfortable with what seems to be a highly utilitarian approach to investment. . . We should reduce these thresholds as far possible, even if that means mitigating our results.”
The Sugden, Grylls, and Goddard amendments were carried.
Canon Martin Wood (Chelmsford) said that he was concerned how the motion failed to mention the poor, although climate change affected them disproportionately. He urged church investors to consider how companies were working in the developing world.
Martin Sewell (Rochester) said he was still unhappy about the position on shale gas. Its discovery had lowered energy prices, which was “good news to the poor”; and that option should be kept open. “I want us to have a voice which says we are not uncritically engaged with the climate-change debate,” he said. The Revd Amanda Fairclough (Liverpool) disagreed with Mr Swattridge: utilitarianism was sometimes necessary. “Demonstrate your trust in us by giving your resounding support to the motion.”
The Synod carried the amended motion by 255 nem. con. with 7 recorded abstentions. It read:
That this Synod, accepting that the threat posed by climate change to the environment and human wellbeing requires urgent action to reduce the consumption of fossil fuels, and recognising that achieving this effectively without creating damaging and unintended economic consequences requires political subtlety, flexibility and a focus on achievable change:
(a) affirm the policy on climate change and fossil-fuel investment developed following the Southwark DSM passed by the Synod in February 2014, recommended by the EIAG, and adopted by the National Investing Bodies (“the NIBs”);
(b) welcome the disinvestment by the NIBs from companies focused on the extraction of oil sands and thermal coal;
(c) urge the NIBs to engage robustly with companies and policy makers on the need to act to support the transition to a low-carbon economy and, where necessary, to use the threat of disinvestment from companies as a key lever for change;
(d) urge the NIBs to encourage the work of those energy companies committed to carbon pricing and investing in research into cleaner fuels, natural gas and carbon capture and storage;
(e) urge the NIBs proactively to seek and scale up investment in renewable energy and other low-carbon energy sectors and to track low-carbon indices;
(f) request the EIAG and the NIBs to publish their “engagement framework” by June 2016; and
(g) request the EIAG and the NIBs to report to the Synod within three years with an assessment of the impact of the policy adopted, including the efficacy of engagement and the progress made on portfolio decarbonisation.