[GPSCC-chat] Fw: [350 SV Chat] Oxford study of effects of divestment campaign on fossil fuel industry

[Caroline Yacoub]

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From: Katherine Forrest <kaforrest at earthlink.net>
To: MidPeninsula Global Coolers - 350 SV <mid-peninsula-global-coolers at googlegroups.com>; 350-SV-Chat <350-silicon-valley-chat at googlegroups.com> 
Sent: Monday, October 14, 2013 12:51 PM
Subject: [350 SV Chat] Oxford study of effects of divestment campaign on fossil fuel industry
  


FYI, here’s a University of Oxford study of the effects of the divestment 
campaign on the fossil fuel industry: 

http://www.smithschool.ox.ac.uk/research/stranded-assets/SAP-divestment-report-final.pdf 

See pp. 70 & following pages for summary of the study. 

Article in the English publication, The Guardian, which references this 
study: 

http://www.theguardian.com/environment/2013/oct/08/campaign-against-fossil-fuel-growing   
Campaign against fossil 
fuels growing, says study 
Investors being persuaded 
to take their money out of fossil fuel sector, according to University of Oxford 
study 
Damian Carrington 
The 
Guardian, Monday 7 October 2013  
A campaign to persuade 
investors to take their money out of the fossil fuel sector is growing faster 
than any previous divestment campaign and could cause significant damage to 
coal, oil and gas companies, according to a study from the 
University of Oxford. 
The report compares the 
current fossil fuel divestment 
campaign, which has attracted 41 institutions since 2010, with 
those against tobacco, apartheid in South Africa, armaments, gambling and 
pornography. It concludes that the direct financial impact of such campaigns on 
share prices or the ability to raise funds is small but the reputational damage 
can still have major financial consequences. 
"Stigmatisation poses a 
far-reaching threat to fossil fuel companies – any direct impacts of divestment 
pale in comparison," said Ben Caldecott, a research fellow at the University of 
Oxford's Smith School of Enterprise and the Environment, and 
an author of the report. "In every case we reviewed, divestment campaigns were 
successful in lobbying for restrictive legislation." 
The report is part of a new 
research programme on stranded assets backed by Aviva Investors, HSBC, Standard 
& Poor's and others. It found: "The fossil fuel campaign has achieved a lot 
in the relatively short time since its inception." 
Some major investors, such 
as the $74bn Scandinavian asset manager Storebrand, have already pulled their 
funds from coal stocks. But the researchers found that even if the maximum 
possible capital was divested by university endowments and public pension funds, 
the total was relatively small compared to the market capitalisation of traded 
fossil fuel companies and the size of state-owned 
enterprises. 
However, the team 
concluded: "The outcome of the stigmatisation process, which the fossil fuel 
divestment campaign has now triggered, poses the most far-reaching threat to 
fossil fuel companies and the vast energyvalue 
chain." 
Analysing previous 
campaigns, the researchers found examples of stigmatised companies being shunned 
by governments and being barred from public contracts or acquiring licences. 
"Stigma attached to merely one small area of a large company may threaten sales 
across the board," the report found, citing the examples of Motorola dumping its 
defence business due to bad press and Revlon's decision to disinvest from its 
South African operation after customer groups threatened a 
boycott. 
The report also found 
instances when customers, suppliers and potential employees were scared off by 
stigma and where stigma had led shareholders to demand changes in the management 
of companies. 
Bill McKibben, the 
environmental campaigner who leads the 350.org divestment campaign which is 
expanding from the US into Europe this autumn, said: "This divestment campaign 
is just one front in the climate fight, but of all the actions people can take 
to bring about structural change, it's probably the easiest. Severing our ties 
with the guys digging up the carbon won't bankrupt them--but it will start to 
politically bankrupt them, and make their job of dominating the planet's 
politics that much harder." 
A report in 
Aprilbacked by climate economist 
Lord Stern found that at least two-thirds of the fossil 
fuelslisted as assets by the 
world's fossil fuel companies would have to remain in the ground if governments 
were to fulfil their pledge of keeping climate 
changebelow the danger limit of 
2C. The UN's Intergovernmental Panel on Climate Change (IPCC), backed by 193 
governments, reached a similar 
conclusionat the end of September. 
David Nussbaum, chief 
executive at WWF-UK, said: "With the IPCC giving us the clearest signal yet of 
the threats posed by a changing climate, it's clear that we must consider the 
risks to businesses and investors posed by investments in fossil fuels. Prudent 
investors want to be ahead of pack, not following the herd, so they will be 
preparing for a world where we leave fossil fuels in the 
ground."
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