A strategy has been backed for the managed divestment in fossil fuel assets from the pension fund in which Stirling Council workers are members.
Falkirk Council Pension Fund has £97m invested in oil and gas companies.
Last year environment activists Extinction Rebellion took part in protests outside Stirling Council’s ‘Customer First’ office in Port Street calling on local authorities not to invest in these companies.
Stirling Council’s finance and economy committee convener Margaret Brisley – responding to a question submitted by Green councillor Alasdair Tollemache at last Thursday’s full Council meeting – has backed a request that the local authority write to Falkirk Council Pension Fund ‘to clearly set out their strategy on a responsible divestment from carbon-producing assets’.
Councillor Tollemache pointed out this week that it follows a similar request passed by Glasgow City Council last month concerning the Strathclyde Pension Fund Committee.
The Dunblane and Bridge of Allan councillor said: “It’s very important that Falkirk Council Pension Fund now set out their answer on the crucial issue of divestment from fossil fuels.
“We as a council have declared a climate emergency so now is the time to see actions not just words.
“I look forward to working with my colleagues to see positive actions on all aspects of the climate emergency”.
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In her written response to councillor Tollemache, councillor Brisley said: ‘I am aware that the global shift from the use of fossil fuels for energy generation to more sustainable energy sources has implications for the assets held by pension funds, and the returns generated from those asset holdings.
‘I would be very concerned if any of the pension funds that our employees are members of were not responding to that climate challenge and making investment and divestment decisions accordingly.
‘I would also be concerned if pension funds were making divestment decisions in an unmanaged manner to the clear detriment of the financial interests of their current and future members.
‘While the holding of assets in sectors such as mining have produced high financial returns in the past, the reduced consumption of fossil fuels is likely to make those assets much less financially productive in the medium to long-term, and to potentially render them as toxic assets.
‘Managed divestment is therefore not necessarily at odds with the fiduciary duty of pension funds.
‘This Council has already very clearly stated its recognition of the climate emergency, and it is one of our absolute priorities.
‘I would be very happy to support a written request from Stirling Council to the Falkirk Council Pension Fund, asking them to clearly set out their strategy on a responsible divestment from carbon-producing assets’.
Falkirk Council Pension Fund said this week: “Falkirk Council Pension Fund takes its role as a responsible investor very seriously. As well as investing in renewables, we have just committed £150m to an environmentally themed fund.
“We have previously sponsored climate change resolutions at company AGMs, including BP. We believe that working with other like-minded investors to drive change across the energy sector is what genuinely responsible investors should do. We make clear in our Statement of Responsible Investment Principles that we will divest if engagement on climate is proving fruitless.”