JAN 11, 2018
Jan 11, 2018
The move to divest funds from fossil fuel interests in resistance to climate change has been slowly building. With New York City joining the effort, there’s a new multi-billion-dollar signal.
The divestment movement started on campuses. Now it’s seeping, like black tar from a leaky oil rig, into a city near you.
On Tuesday, New York City announced it would divest pension funds from fossil fuel interests, joining New York State, a cadre of other U.S. cities, and some private universities who say they will pull investments from companies that extract coal, gas, and oil. De Blasio also announced the city’s plans to sue five major oil companies for their role in damages brought on the city by climate disasters.
These are the latest moves in a wave of climate-oriented challenges at the local and state levelintended to fill the gaps opened by the Trump administration, which has rolled back federal environmental protections and pulled out of the Paris Climate Accord.
New York City’s pension fund announcement comes just weeks after New York state governor Andrew Cuomo promised that the state pension would also divest, “ceasing all new investments in entities with significant fossil fuel-related activities.”
The money on the table is significant. New York state’s common retirement fund is the third-largest in the nation, worth $200 billion, and provides pensions for more than 1 million New Yorkers. The fund has stakes in 50 oil and gas companies, with $1 billion tied to ExxonMobil alone. New York City’s pension fund, which pays for city employees like police officers, firefighters, and teachers, is also a huge bucket, worth $191 billion. Currently, $5 billion is currently tied up in fossil fuels. (For comparison, San Francisco’s has invested $1 billion; and Seattle’s, $17.6 million.)
When the fossil fuel divestment movement began on college campuses, “the initial impulse was a purely ethical argument,” said Ellen Dorsey, founder of DivestInvest Philanthropy and Executive Director of the Wallace Global Fund. It wasn’t okay, people argued, to be invested in the companies that were driving the climate problem.
This week, Comptroller Scott Stringer explicitly linked the action to the fight to slow climate change, saying the financial future of the city’s employees is inextricably “linked to the sustainability of the planet.”