The Church of England’s National Investment Bodies (NIBs) have reached a compromise with those in the Church uneasy at their investments in fossil fuel companies that are misaligned with global climate targets.
In a vote at the Church’s General Synod last Sunday members voted in favour of a non-binding amendment to the NIBs’ investment strategy urging them to divest all fossil fuel companies “not prepared to align with the goal of the Paris Agreement to restrict the global average temperature rise to well below 2°C” by 2023.
The NIBs had been seeking continued support from the Church’s council for their ethical investment policy – which was unanimously backed in 2015 when it was first presented.
Its investment strategy, which prioritises engagement as its “primary focus of action”, crucially, had no clearly defined end-point for investment in fossil fuel companies not aligning with Paris. It was this issue of engagement time-frames that was the heart of the debate at the meeting and the subject of two amendments.
Last month, RI reported that the Bishop of Oxford had filed an amendment calling on the Church investors to “automatically” and “immediately” divest any fossil fuel company whose business plans are not aligned with the Paris goal by 2020.
It was the filing of this amendment, according to a source close to the discussions, that “began to change the language around the debate a few weeks before synod” and increased the scrutiny of the NIBs’ position.
Rowan Williams, the former Archbishop of Canterbury, wrote in defence of the amendment in The Daily Telegraph the day before the vote.
Williams wrote: “The [Oxford] motion at Synod envisages disinvestment from any company that has not produced a Paris-compliant plan by 2020. In other words, it is not calling for instant divestment or an instant turn-around by companies; what it is doing is giving notice that the Church believes this matter to be too urgent to be left to what it can be done through ‘engagement’ alone. There must be a red line or two laid down.”
Earlier that week, 91 Anglican Bishops signed a letter published in the Church Times urging the Synod members to vote in favour of the Oxford amendment, arguing that it “reflects the urgency of action required to prevent the worst impacts of climate change”.
The incumbent Archbishop of Canterbury, Justin Welby, had already called upon the Church of England’s engagement framework, the Transition Pathway Initiative (TPI), to ramp up its efforts in driving high emitting companies to transition to a low carbon economy, stating that it “must produce outcomes”.Welby called the TPI’s most recent findings on companies’ progress on climate change “a cause for great concern” and called upon the £7tn in assets behind the TPI to “flex its muscles ever more clearly and ever more powerfully” in driving companies to act.
Then, just days before the Synod vote, another more moderate amendment was submitted by Canon Giles Goddard, the Vicar of St John’s in London. This amendment – whilst also setting a deadline for engagement – offered the NIBs the option to engage for three more years before divesting – taking the deadline to 2023.
David Walker, Bishop of Manchester and Deputy Chair of the Church Commissioners, one of the three investment bodies of the Church, expressed his “sympathy” and “support” for Goddard’s resolution immediately before the Synod voted. But he added that the Oxford amendment, if approved, would “cut the legs away from our [engagement] strategy”.
A source said that the NIBs supported Goddard’s amendment “as a way of seeing off a more radical alternative”, the motion filed by the Bishop of Oxford.
This was denied by the NIBs, who told RI that they supported Goddard’s amendment as its “2023 deadline… corresponds to the work of the Climate Action 100+ initiative and their deadline that we are working towards with them”.
Speaking at the Synod, Goddard asked members to support his proposal, if the Oxford amendment fell. He said his less extreme amendment allowed the Church “to continue to work hard to bring about important change but has a very clear end point”.
The investment strategy, with the Goddard amendment, was passed with 347 in favour to 4 against, with 3 abstentions.
A spokesperson for the Church of England said of the vote: “[The] decision, including the amendment by Giles Goddard, will allow us to continue to push for real change in the oil and gas sector and use engagement, our voting rights and rights to file shareholder resolutions to drive the change we want to see.”
Following the vote, the Bishop of Oxford, despite the rejection of his amendment, expressed his pleasure at the support for Goddard’s, calling it a “considerable step forward”.
The NIBs are comprised of the Church of England Pensions Board, the Church Commissioners, and CBF Church of England Funds (managed by CCLA) and manage assets in the region of £13bn on behalf of the Church.