You may have heard about the global Divestment movement which is growing rapidly (see: 350.org), and also about going ‘Fossil Fuel Free’ in your super & investment portfolios.
Investors around the world are aligning their investments with their ethics, and divesting from fossil fuels. But are there many options for Australian investors who want to do the same?
In addition to ethical considerations, there’s research that suggests fossil fuels may not be a good long term investment. Mercer is one Asset Consultant that has warned investors against portfolios based on fossil fuel investments#, and recommends that portfolio managers factor climate change impacts into risk modelling – a seismic shift in investment behaviour for many. See: Mercer Research Study Announcement
Going fossil fuel free involves screening out investments based on their exposure to fossil fuels. Companies which have direct exposure to fossil fuels (eg mining companies) are screened out, as well as those having indirect exposure (eg infrastructure/ transport services, and banks who lend to fossil fuel projects).
Some investment managers with fossil fuel free options include (please note that these are not investment recommendations):
– Australian Ethical Investment
– Generation Investment Management (Chairman Al Gore recommends divestment from fossil fuels – see: FT Article)
– Hunter Hall Investment Management
– In addition, many of our Ethical Advisers’ Co-op firms have in-house portfolios to match their clients’ requirements, created by ethical investment specialists. At JustInvest, our fossil fuel free share portfolio is called the FPI Dark Green Opportunities portfolio (contact us for more information).
More reading and information:
Extracting-fossil-fuels-from-your-portfolio-a-guide-to-personal-divestment-and-reinvestment
Euro-zone-heavyweight-norway-divests-coal
Global-warming-critical-risk-investors
There’s many options for Australian investors when it comes to fossil fuel free investing – and we suggest that you seek advice from an ethical investment specialist before making your choice.
