The divestment debate: Should we profit from climate-killing corporations?

Investors have long made money -- lots of money -- from corporations that exploit or trade in polluting fossil fuels.  As climate change worsens, calls to halt such investments have grown.  Here, Australian conservationist Wayne Branden outlines the case for divesting from corporations that profit while the planet burns:

“If it’s wrong to wreck the climate, then it’s wrong to profit from that wreckage.”  - Bill McKibben

An Urgent Task Ahead

In an effort to combat harmful climate change, 195 nations have agreed to limit average global temperature increases to no more than 2°C above pre-industrial levels. 

This amount of warming could still possibly cause the Greenland ice sheet to melt, eventually raising sea levels by as much as seven meters.  Beyond that, it is estimated, things would get a lot worse.        

To have just a 50:50 chance of staying within the two-degree limit, it has been estimated that 88 percent of global coal reserves, 52 percent of gas reserves, and 35 percent of oil reserves must be left in the ground.  They must not be burned.  If they are burned, the analyses suggest, it will wreck our climate

And if these fossil fuels cannot be burned, then they will become stranded economic assets. 

Therein lays a serious conundrum -- because we are talking about really serious money.  Recently, Citigroup analysts suggested that stranded assets relating to fossil fuels could total up to US$100 trillion in value. 

Mining corporations don't want to hear any such nonsense.  The corporations intend to continue extracting all economically viable hydrocarbon deposits, regardless of their impact on the climate.  They have already discovered five times more hydrocarbons than can be safely burned without wrecking our climate.  And these corporations continue to spend hundreds of billions of dollars a year -- exploring for more fossil fuels that must not be burned.

Big money, big power

The mining industry wields considerable political power -- notably in Australia and the U.S. -- but also in many other nations. 

Those who oppose big mining do so at their peril.  In Australia in 2010, then-Prime Minister Kevin Rudd proposed a Resources Super Profit Tax on the mining industry -- which at the time was raking in massive profits. 

The miners ran an A$22 million public-relations campaign against the Rudd Government.  In just six weeks, Rudd was out, and the campaign had effectively un-seated a democratically elected Prime Minister

To prevent real action on climate change, corporations fund pseudo-science denialist groups.  They also hire public-relations advisers and lobbyists, and they donate to politicians’ election campaigns.  In this way, they have been able to strongly influence government policy and legislation.  

Do the Right Thing

In the fight against apartheid in South Africa during the 1980s, international divestment and economic embargoes helped to starve that regime of funds and legitimacy.  Divestment became a powerful tool in the battle to do what was right.

Divestment can also reduce the legitimacy of the big carbon-polluting corporations.  The global campaign to divest from fossil fuel industries has been led by an organization known as "350.org".  Founded by Bill McKibben, it derives its name from the level of atmospheric carbon dioxide considered to be safe, 350 ppm. 

More recently, The Guardian newspaper has teamed with 350.org to run its own “Keep it in the Ground” campaign -- an effort to advance the divestment initiative.

Divestment can be undertaken at both personal and institutional levels.  Massive amounts of money are held in personal bank accounts and retirement funds.  In Australia, for example, all of the biggest banks are major investors in coal, oil, and gas projects. 

In Australia, banks are being pressured not to invest in a massive coal-mining project that would double Australia’s coal exports.  Environmental groups have successfully lobbied 12 major international banks not to fund this project.  Recently, Australia’s Commonwealth Bank also withdrew its support -- partly because of environmental pressures and partly because of declining coal prices.

Retirement funds are also invested heavily in fossil fuels.  Globally, around 55 percent of retirement funds are invested in fossil fuel projects, while less than two percent is invested in energy efficiency and renewable energy.  Some larger funds offer low fossil fuel-investment streams, and some smaller funds do not invest in fossil fuels at all.

Interest in fossil fuel divestment is growing, with more and more institutions pledging either partial or full divestment.  These include the Rockefeller Brothers Fund, the Norwegian Sovereign Wealth Fund, the World Council of Churches, the British Medical Association, and the Guardian Media Group.  This is just a sampling -- a full list can be seen here.

Universities Are Getting Smart Too

A growing number of universities -- from the U.S., UK, Australia, New Zealand, and elsewhere -- have also pledged to divest either partially or fully.  But they're catching plenty of heat.

In Australia -- where coal mining is king -- Australian National University dared to adopt a partial divestment policy in October 2014.  The Australian Financial Review subsequently ran 53 articles attacking ANU, twelve of them on its front page. 

The newspaper is owned by Fairfax Media, which includes among its shareholders Gina Rinehart, a mining billionaire. 

Such vigorous attacks suggest the mining industry sees divestment as a significant threat to their political power base.

Running Scared

By itself, divestment might not strongly affect the share prices of wealthy mining corporations.  But its effects could be potent nonetheless. 

It could weaken the moral license of big polluters, reducing their political power.  By stigmatizing the industry, it can limit its ability to do business and exert political influence.  It then becomes easier to convince governments to start doing better in terms of their policies and legislation. 

The divestment wave is growing.  And as it grows, more and more people will realize that coal, oil, and gas are bad investments.  Not just a bad and weakening source of profits, but a morally bad choice for our planet, our children, and our future.

Habitat fragmentation disrupts forest carbon cycles

We all know that fragmenting forests is bad for biodiversity.  But it's also bad for the planet -- because it screws up carbon cycles, makes forests more likely to burn, and promotes global warming. 

Fires... not natural in rainforests  (photo by Mark Cochrane)

Fires... not natural in rainforests (photo by Mark Cochrane)

Prior studies, including those led by ALERT director Bill Laurance and ALERT member Tom Lovejoy, have shown that fragmented forests in the Amazon lose a lot of their carbon.  This is evidently because the hot, dry conditions near forest edges kill many trees.  Additional trees are snapped or toppled by wind gusts near edges.

This is bad news because the carbon stored in the trees eventually decomposes and ends up as carbon dioxide and other greenhouse gas emissions. 

Laurance and colleagues estimated that the fragmentation of tropical forests creates up to 150 million tons of atmospheric carbon emissions per year -- equivalent to the entire annual emissions of Great Britain.  And this 'fragmentation effect' is on top of the massive carbon emissions that result from forest destruction.

And now a new study shows that habitat fragmentation also slows down the rate of organic decomposition.  This occurs because the warm, dry conditions near forest edges inhibit wood-eating fungi, which are important decomposers.  In the new study, the rate of decomposition near forest edges was about half that in forest interiors.

This means that dead trees, limbs, leaves, and other woody material will accumulate near edges.  Why is this important?  What happens if you take a lot of fine woody material and dry it out? 

It becomes very, very easy to burn.

In the Amazon, fragmented forests are hugely vulnerable to fires.  Not only does forest fragmentation create a lot of dry, flammable material near forest edges, but cattle ranchers like to burn the pastures surrounding the fragments -- to control weeds and produce a flush of new grass for their cattle.  Many of these fires burn the forests as well.

The results can be devastating.  Satellite images show that fragmented forests in drier parts of the Amazon virtually 'implode' in the first few years after fragmentation -- the result of a withering recurrence of destructive, edge-related fires. 

The bottom line: One of the best things we can do for forests is not to fragment them. 

This isn't just about conserving a few pretty birds or butterflies.  By reducing forest fires and rampant carbon emissions, it's about keeping our planet more livable for all of us.

 

Rainforests imperiled by environmental 'one-two punch'

A strange thing is happening in the Amazon.  So strange that scientists who've spent 35 years studying the rainforests there are still scratching their heads about it.

Forests behaving in very peculiar ways  (photo by R. O. Bierregaard)

Forests behaving in very peculiar ways (photo by R. O. Bierregaard)

In the heart of the Amazon, one of the world's largest and longest-running ecological experiments has uncovered evidence that the remote forests there are being altered by an environmental 'one-two punch' -- a combination of threats acting in concert. 

One of these threats is obvious.  The experiment -- known as the Biological Dynamics of Forest Fragments Project -- has chopped up the rainforest into isolated patches surrounded by cattle ranches.  A large team of researchers has been studying how the trees, vines, mammals, birds, and other animals of the rainforest respond to the environmental insult of fragmentation.

But something decidedly unexpected has also been happening.  The forests are changing in ways far beyond what you'd expect fragmentation to cause.  The dynamics of the forest -- the rates at which trees grow and die -- has accelerated, and disturbance-loving vines are proliferating.  Even undisturbed forests are changing too.

What's happening?  The best explanation is that the forests are responding to rising carbon dioxide levels in the atmosphere -- the result of billions of tons of human-caused carbon emissions each year.  Plants use carbon dioxide for photosynthesis, and when the gas increases it evidently alters forest dynamics and plant communities.

Vines like both forest disturbance and rising carbon dioxide  (photo by William Laurance)

Vines like both forest disturbance and rising carbon dioxide (photo by William Laurance)

So, Amazonian forests are not just being affected by local land-use threats such as habitat fragmentation, but also by global-scale changes in the atmosphere -- an environmental 'one-two punch'. 

This finding was just reported in a paper led by ALERT director Bill Laurance and co-authored by ALERT members Philip Fearnside and Tom Lovejoy, the latter of whom founded the Amazon fragmentation project 35 years ago.

The bottom line: Humans are changing the world in myriad ways, and these changes can interact in a complex fashion.  As a result, it could be very difficult to predict the fate of many ecosystems in the future.