By Mat Hope • Tuesday, June 27, 2017 – 22:01
The Mayor of London and the London Pension Fund Authority (LPFA) have agreed a strategy to “divest” assets worth around £10 billion from fossil fuel companies, DeSmog UK can reveal.
The agreement seemingly fulfills Mayor Sadiq Khan’s campaign promise to strip the fund “of its remaining investments in fossil-fuel industries”.
But campaigners have been quick to criticise the announcement, saying the pledge’s small print means it is unlikely to mean funds are actually removed from fossil fuel companies — the core aim of the divestment movement.
Campaigners are concerned other cities could follow suit, using London’s problematic criteria for divestment as a cover to continue investing in fossil fuels.
With Khan having won the race to City Hall, the mayor’s office and the LPFA told DeSmog UK they have now “agreed an investment policy which is consistent with the Mayor’s Investment Policy on divestment”, first announced at an unreported public board meeting in May.
But the agreement is full of loopholes and caveats that mean the fund will keep most of its fossil fuel investments, and could even invest in new ones, according to campaign group Divest London.
Confirming the announcement, which encompasses all Greater London Authority (GLA) members including Transport for London, the Metropolitan Police and the London Fire Brigade as well as the LPFA and City Hall, a spokesperson for the Mayor of London’s office told DeSmog UK:
“The LPFA’s policy statement makes clear that where LPFA’s fiduciary duty allows it will not consider new active investments in fossil fuel companies directly engaged in the extraction of coal, oil and natural gas as sources of energy which are ignoring the risks of climate change.
“Further, the LPFA’s policy statement also states that all reasonable efforts will be made to divest where opportunities for engagement and reform of the company or project are not possible or do not exist provided that this will result in no material financial detriment to the Fund.”
That the combined total of the funds is just under £10 billion “demonstrates the Mayor’s commitment to fighting climate change”, they said.