As the pressure builds at the CoP28 Climate Summit for a timetabled phase out of fossil fuels, Mindful Money is calling for members of the public to ensure that their KiwiSaver funds are not invested in companies that produce coal, oil and gas, or in companies that generate electricity from fossil fuels.
Climate chaos is here and now
Barry Coates, CEO of Mindful Money, warned: “We have already had painful warnings of the chaos that climate change can bring, with people all over New Zealand suffering from floods, landslides and storms. However, this is only the warm up act from our climate. Unless we all play our part and act quickly, the future will be far more dangerous.”
“Consumer action is essential. We cannot rely on governments who are still arguing about a fossil fuel phase out at CoP28, 21 years after the climate change convention was signed. A strong global agreement is unlikely at this summit, especially since it is chaired by the chief executive of an oil company which is planning a massive expansion of its fossil fuel production.”
Sultan Al-Jaber’s position in defence of more fossil fuel production was confirmed in a recent testy exchange with Mary Robinson, Chair of the Council of Elders and former President of Ireland.
What can consumers do?
There are 3.2 million people with KiwiSaver funds. Many of them have no idea that they are invested in companies that are still producing fossil fuels, or burning them to produce electricity.
Most Kiwi investors say they want to avoid investments in fossil fuels, but $3.2 billion of their KiwiSaver fund investments are still invested in fossil fuel companies. It is time for the managers of KiwiSaver funds to get out of shares in the fossil fuel companies.
Barry Coates explained: “Anyone can see how much of their KiwiSaver is invested in fossil fuels by visiting Mindful Money. It’s quick, easy and free. And then they can use the Fund Finder to find a climate friendly fund.”
Does divestment work?
The fund managers often argue that they are investing in climate polluters in order to influence the major fossil fuel companies. But, after decades of broken promises and greenwash, this is wishful thinking. Instead of transitioning to renewable energy, most of the major producers are still expanding their exploration and production. In response, the leading investors have given up trying to persuade the major oil companies to transition to renewable energy and have sold their shares.
The KiwiSaver providers still investing in fossil fuels could join them, by signing up to the global movement to avoid fossil fuel investment, which now has more than US$40 trillion of funds under management.
The impact of investors avoiding fossil fuels can be seen in last week’s statement by Genesis Energy that they will finally transition away from coal burning at Huntly power station. One of the reasons for Genesis to shift towards renewable energy was the estimate that their share price was around 20-30 percent lower than other gentailers that use a higher proportion of renewable energy sources.
Flip the switch
Barry Coates commented: “Individuals with KiwiSaver funds need to take responsibility for how their money is used. When they do so, they can influence the share price of Genesis and other companies, creating incentives for them to transition to renewable energy.”
“Many KiwiSaver fund managers have done the right thing and sold off their investments in the oil giants. Some are going to the next step and investing in solar, wind and battery storage that is ushering in a new and exciting era of renewable energy.”
But there are still holdouts amongst KiwiSaver providers, who are supporting the climate wreckers and risking financial losses during the inevitable decline in the fossil fuel industry.
Barry Coates concluded with a message to the public: “We all want to play our part to address the climate crisis. But switching off the lights when you leave the room isn’t enough. It is time to also switch your KiwiSaver provider and other investments if they are part of the problem.”
Barry Coates
CEO, Mindful Money
