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Just as the student led boycott of tobacco companies and sports business in South Africa ’s banks, global fossil fuel divestment movement is vigorous manner. In high-profile support of The Guardian, surrounded by students at Harvard University administration building in the background, supporters hope to destroy vital way to hit the world’s oil and gas companies --hit their financial status.
This action is a bumbling orchestrated move, too contradictory and unrealistic and difficult to succeed. Even the movement of people admit that they are not particularly serious --they let ExxonMobil and Royal Dutch Shell the possibility of failure is almost zero, and if they do succeed, own lights will be extinguished. This is a potilical movement under the banner name of finance, essentially intended to promote the introduction of carbon tax and green laws.
Supporters didn’t care about the contradiction between the demands. Recently, when I and Bill Mckibben the movement’s promoter chat at Harvard surrounded line, he felt happy to “this movement is encouraging way to generate a shock wave”, even though his alma mater refused to listen.
He rightfully so, any such lack of logic has produced such influential movement, should get some grudging respect. Gates Foundation and Wellcome Trust and other charitable organizations, the main object of “Guardian” campaign, now facing public criticism illogical, this fact proved the power of ideas, even though the idea is halfcooked.
A smaller attack movement, for example, allow investors to sell coal mining and coal enterprises shares, will be more wise, and may take effect. In the face of the reality, I suggest those foundation become the target of divestment movement who behave like cheerleaders: put a great symbolic gestures do things carelessly, and then doing the doing.
In 2012, McGibbon raised a serious view in rolling stone paper the start of this movement. He proposed that the carbon content of oil companies and oil producing countries of existing reserves, is to make the earth warming more than 2 degrees celsius required for carbon emissions several times.
If you like me believe that global warming could have disastrous effects, this is a sobering thought. It means that investors used to determine the energy companies are based on the value of reserves, if fully exploited, it may cause climate catastrophe. The gap between the financial valuation and social well-being, led to energy assets “stranded” warning, because in fact these assets can not be fully utilized.
However, McGibbon came to the conclusion accordingly:investors should entirely divestment from the oil and gas company. The movement from the beginning of humiliation foundation, hoping to produce a chain reaction, so that energy production similar to the tobacco company’s “sin stocks”. “We do not want Exxon bankrupt, but we just let them go bankrupt in politics” he said.
In this way for the large oil companies, both too narrow and too broad. Too narrow because only blame energy raw materials manufactures without investigate company and individuals who use the energy, it is illogical. Why Exxon should be the divestment target, and like Apple such a company was able to survive?
The movement is full of contradictions. “The Guardian” from the sale of Auto Trader Journal of oil related shares get 650 million pounds of funding support. Support divestment Rockefeller Brothers Fund from the oil wealth of the family property.
Everyone can be a bit hypocritical, but this issue is more serious. As Harvard president Drew Faust said, Harvard exist “universal dependence” on fossil fuels, such energy can make school building warm and bright, provide fuel to transportation, also allow the computer to run. However, If Harvard can sell the shares of energy companies, at the same time, continue to use their products, sports people will not care about it. It makes no sense.
The second problem is the breadth of the movement. According to the Oxford University “Stranded Assets Programme” of the relevant data, divestment campaign against fossil fuel industry in 2013 the total market capitalization is about trillion. The industry’s cash flow to support a number of pension funds and endowments : Shell plans to buy the British Gas Group(BG Group) means that, after the merger of the group will pay the British FTSE 100 9% of the company’s dividend.
Even some endowments divestment, it was only a drop in the bucket, gap is easy to be filled by those less active and socially conscious investors. If emissions endowment fund to sell holdings of the largest coal producers and other company’s stock, it would achieve better results. The coal industry is relatively small, because the rise of shale gas and is in a vulnerable position.
In fact, the divestment campaign participants are more interested in producing a wide range of political shocks, rather than deep financial influence. They want to let the whole industry notoriety, thus forcing the government to pass laws. But why should respond to an endowment fund even the protesters themselves are not seriously protest it?
Last year, the Rockefeller brothers fund sold most of the coal industry investment, committed to “in the next few years” find the appropriate strategy for further withdrawals.
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