Short answer: Stop investing in fossil fuels: coal, gas and oil. Insist that your financial adviser/retirement fund/asset manager gives you the option to invest in the sustainable emerging economy, and not in the climate-killing old economy.
(You don’t think you’re invested in fossil fuels? Unless you’re managing your own portfolio and have excluded fossil fuels, you’re close to 100% likely to be invested in fossil fuels, in SA.)
Longer answer: There are millions of South Africans who participate in some form of collective investment via retirement funds or direct personal investment. Every one of us has the option of casting very strong “votes” against climate change by refusing to have our money invested any longer in high-emitting companies like Sasol and BHP Billiton. If you’re an Allan Gray client, for example, you should know that they’re the second biggest investor in Sasol after the Government Employees Pension Fund.
Reality check: Taking action on this is difficult and frustrating at the moment. In Europe or the US, you can just switch funds. In SA, the funds we want don’t exist – yet.
As Fossil Free SA, we are trying to coordinate action between savers to ensure that we can collectively ask our retirement funds and asset managers to give us the options we need, and start to make it much easier to be ethical in our investments.
Ethical investment should be the norm, but at the moment, it’s very much the exception. Which in fact places us at great financial risk. Climate and carbon risk are already creating direct economic damage. Stranded assets could erode your savings, and even threaten the stability of the global financial system.
Want an example of how this works in practice? One smart retirement fund we know of uses ESG screening (environmental, social and governance), via the MSCI ESG leaders index – which kicked out Steinhoff from the index prior to the major fall in its price.
ESG screening and divestment are not the same thing – but ESG screening can effectively add up to divestment with suitably robust criteria.
There are hundreds of institutions around the world divesting from fossil fuels, even whole countries (Ireland). You haven’t heard about it because of our parochial/conservative media, but it’s happening on a huge scale.
The way we invest literally creates the future. If we want to create a different future, we have to invest differently. Please join us in doing this.