Climate risksClimate change is the most significant threat to our long term health and prosperity. The impacts of climate change – including flooding, heat waves and crop failure – are already being felt around the world.We need to leave 80 per cent of fossil fuel reserves in the ground to even have a chance of avoiding a dangerous two degree warming scenario. Currently, the world is heading for a catastrophic five degree warming. Urgent action is required.City Hall has considered the impact of climate change on Londoners, from flooding to heatwaves. The impacts of the ‘Carbon Bubble’ on the London economy are significant, not to mention the 9,500 deaths caused by air pollution every year. City Hall’s conclusion is that the LPFA must ditch companies involved in fossil fuels.The legal purpose of the London Pension Fund is to pay the pensions of London’s workers – from council employees, to nurses, to tube drivers – to safeguard their future. It makes no sense to use their pensions to fund the very companies that are destabillising this future.
Beyond the moral and financial risks, the LPFA also risks the reputational stigma of funding catastrophic climate change. Research shows that organisations heavily criticised in the media have their reputation tainted, with subsequent impacts on shareholders, members and the board.
''In almost every divestment campaign we reviewed from adult services to Darfur, from tobacco to South Africa, divestment campaigns were successful in lobbying for restrictive legislation affecting stigmatised firms.''