THE General Synod received a presentation on Saturday afternoon from the Church’s national investment bodies (NIBs), which set out their decision to jettison holdings in oil and gas companies (News, 22 June).
Before the presentation, a procedural motion from Prudence Dailey (Oxford) enabled the Synod to consider whether listening to a presentation “was the best use of our time”. Miss Dailey referred to her comments in the previous day’s debate on the agenda, in which she had suggested less time for presentations.
The First Church Estates Commissioner, Alan Smith, thanked her for her intervention. He and the Pensions Board chair had, he said, come to the Synod so that they could be “accountable to what you have asked us to do”. He hoped that they would be able to continue. Her motion was lost.
Mr Smith began by referring to a 2018 Synod motion (News, 8 July 2018) that had compelled the Commissioners to act and to return to the chamber to explain their measures on what he described as the “defining issue of our time”.
The Pensions Board and CBF fund, managed by CCLA on behalf of 14,000 church organisations, were also involved. He said that the NIBs had a clear framework on how to act on climate change, co-founding transparency initiatives and engaging with fossil-fuel companies. They had also adopted the target of limiting temperature rises to 1.5° from the Paris Agreement. “One-point-five to stay alive is not just a slogan,” he said.
This whole process leading to disinvestment this year (News, 23 June) represented synodality at its best, Mr Smith said, and he thanked members for supporting this journey. First, they had engaged with fossil-fuel companies to see if they were aligned with climate-change goals. But no oil or gas company had come close to this. “We haven’t seen the leadership we hoped for from some of the world’s biggest companies.” As a result, engagement was giving way to disinvestment by the end of the year.
“This is not just about emissions but investment discipline,” he said. Companies not sensibly allocating more and more capital spending to climate change were not the firms of the future, therefore it did not make sense to invest in them, Mr Smith explained. They were not excluded for ever, however, and, if a fossil-fuel company became aligned with the Paris Agreement, they would be reconsidered for reinvestment.
Sam Atkins/Church TimesThe chair of the Pensions Board, Clive Mather
The Chair of the Pensions Board, Clive Mather, said that his team had engaged vigorously with fossil-fuel companies for years but had sadly not achieved what they had hoped. As a result, they, too, had decided to exclude these companies from their investment portfolio.
“It was good we pushed as hard as we could, and it was good we have demonstrated our intent, but it is still sad that we did not succeed,” he said. To return to investing would need long-term evidence that a firm had really changed its mind, he said. Now, more focus was going into choking off demand for fossil fuels, which would have a big impact on production, he explained.
All big fossil-fuel companies talk a good game about being on path to 2050, he said, but “they were no way near” — so the board had to disinvest. But he remained proud of the Transition Pathway Initiative (TPI), which now had 10,000 companies signed up. About 75 per cent of the biggest emitters had begun to develop climate-change plans because of this work, which was positive, even if their plans lacked sufficient ambition. This work would continue, he concluded, because disinvestment did not mean disengagement.
The Bishop in Europe, Dr Robert Innes, said that the decision taken was “simply huge” and thanked the Commissioners and the Pensions Board. He expressed a hope that the Church would be able to communicate effectively its leadership in encouraging the climate transition, such as its part in developing the TPI (News, 19 July 2019).
Mr Mather responded to a question from Adrian Greenwood (Southwark) about the NIBs’ position on nuclear power. Mr Mather said that the “carbon balance” of nuclear power was complex, owing to the resources required to build nuclear power stations, and suggested that timing was also a problem, as there was a chance that the world would already have “fried” before more power stations could be built. He did, however, pledge to keep the possibility of investing in nuclear power under review.
Clive Scowen (London) asked how disinvestment was going to help if the shares had been sold to people who did not have the same ethical concerns.
In response, Mr Smith said that engagement was important, but that they felt that the time had come to “shake the dust from our feet”.
The Revd Kathryn Campion-Spall (Bristol) said that she was a trustee of charities with investments worth around £2 million, and that they were discussing whether to use the C of E’s ethical-investment principles. Could smaller investing bodies following the NIBs’ approach add weight to their efforts, she asked.
Canon Ruth Newton (Leeds) thanked the NIBs for doing “precisely what we asked”. Did disinvestment mean that engagement and the TPI were redundant now, despite the Synod’s endorsing that approach?
The Bishop of Norwich, the Rt Revd Graham Usher, the lead bishop on the environment, thanked the NIBs for their hard work on this topic. “Ultimately, we have failed,” he said, “which is a source of huge lament. The cry of creation is calling out amongst us all.” How would the Church use its investments in the future to have a positive effect on new technologies, and to ensure a just transition for countries on the front line of climate change, he asked. He ended by quoting bishops in the Pacific who had warned that their island nations were sinking.
Mr Mather told Canon Newton that he could not tell her what to do, but pointed her towards resources produced by the Ethical Investment Advisory Group. The teams were available; so “please do use us,” he said.
He also reassured the Synod that no engagement or TPI work would be scaled back as a result of disinvestment. The TPI in particular was a gift to the world, freely offered to anyone, he said. “You have access to the most rigorous, meticulous, objective, independent assessment and you don’t have to pay for it.” Many large companies were using it daily to track their progress against their peers.
Mr Smith thanked Bishop Usher for his “immense support” and insisted that he remained hopeful. “The darkest hour is just before the dawn,” he told the Synod. The Church had more agency than it realised, and even those stewarding relatively small amounts of money could still make a difference. What mattered was the “power of our example”.
Responsible investment went beyond simply climate change, and the Commissioners had recently hired someone to focus on the human-rights dimension. “We must be seeking justice, and it can’t be just us.” The Commissioners did not want only their own portfolio to be net zero: they wanted a net-zero world. After all, the effects of climate change would be felt by everyone.
The Revd Eleanor Robertshaw (Sheffield) praised the work of the Pensions Board, of which she is a member. She also referred to the issue of public perception: “How do we make sure people outside this chamber see that we are bothered about the world?”
Dr Cathy Rhodes (Sheffield) asked for a “really clear statement” that the NIBs would not reinvest in fossil-fuel companies that sought to develop new oil and gas projects.
The Revd Martin Poole (Chichester) asked how the NIBs could encourage dioceses to follow their lead.
Responding, Mr Mather said that there was a “very high hurdle indeed” for any future reinvestment.
“Being objective, what impact on the oil majors has this decision had?” Dr Ian Johnston (Portsmouth) asked. He suggested that people outside the chamber would regard the move as “virtue-signalling”, and that the Church should be looking at “really radical solutions” rather than taking the “easy option” of disinvestment.
“Yes, they will find other investors,” Mr Mather said, and this was part of the “sadness” of the decision. “But this was not a futile gesture: this hurt; it brought them into sharper focus,” and it would “dent their long-term returns”.
The Bishop of Bath & Wells, Dr Michael Beasley, wished disinvestment could be the main story coming out of the Synod. “What would you like us to say about the disinvestment decisions that have been made?”
Carl Hughes (Southwark), who was appointed chair of the Archbishops’ Council’s Finance Committee on Friday, said that oil companies beyond Europe generally had a much worse record on climate transition than those in which the NIBs had previously invested. The demand for fossil fuels remained, and it would be worse for the environment if production shifted to companies that were less committed to the transition, he suggested.
Mr Smith responded that European oil and gas companies had set targets, “but this year rolled back on them”. They had received windfall profits, but had not adequately invested that money in the climate transition.
Penny Allen (Lichfield) praised disinvestment, but asked what efforts were being made to tackle domestic net-zero concerns, such as housing or cuts to the aid budget.
Mary Durlacher (Chelmsford) plead for the Church to “make the main thing the main thing”. Its primary duty was to witness to the gospel, but there was no mention of God or Jesus in the documents on this.
Mr Smith said that net-zero homes were central to the Commissioners’ thinking regarding their own properties and development. There were now also concerns around so-called “greenlining” of people (often among the poorest) whose homes were in the wrong places, for example, and who were cut off from access to finance and credit. How resilient societies were to climate change was just as important as managing the transition to net zero. This was a growing focus.
Mr Mather said that all the Pensions Board’s work was underpinned by theology. “We are very clear who we are, and our Lord Jesus Christ is our inspiration.” But he noted the challenge from Mrs Durlacher to make that more explicit in documents issued publicly.