27th February, 8pm, Dublin, attendees of the Irish Association of Pension Funds (IAPF) annual black-tie dinner at the Clayton Hotel Burlington Rd were caught off-guard as pre-dinner speeches were interrupted by a group of Extinction Rebellion Ireland (XRI) activists demanding that Irish pension providers divest their funds from fossil fuels. The group of 20 activists stormed into the ballroom, accompanied by drumming and made their way up to the stage holding banners reading "Divest Our Pensions From Fossil Fuels". They then launched into their own brief speeches demanding that Irish pension funds stop fuelling the industry that's most to blame for the greenhouse gas emissions that are driving the escalating climate crisis. The individual speeches were punctuated by a chorus of activists shouting "We are here to make you see, pensions should be fossil free!". After wrapping up their speeches, the activists did a lap of the ballroom while chanting and drumming before exiting.
Recent analysis by the Business Post revealed that Ireland's main private pension providers have at least €9 billion invested in the fossil fuel sector. To meet the Paris Agreement target of limiting warming to 1.5°C above pre-industrial levels, nearly 60% of our existing oil & gas reserves and 90% of coal reserves must remain in the ground. Yet Irish pensions are heavily invested in companies like Shell and Chevron that are actively exploring for new fossil fuel reserves.
One of the activists, Sean Loughran, a father of three who has invested in a company pension for 35 years, said "It's outrageous that Irish pension funds continue to be invested in fossil fuels this far into the climate crisis. We're here to make these pension companies look in the mirror, make them reassess what they're doing and change course.”
Ireland's main private pension providers are Irish Life, New Ireland, Aviva and Standard Life, making up about 95% of the market. According to sustainability disclosure documents 8.8% of Zurich Life's pension fund assets are invested in the fossil fuel sector, 7.4% of Irish Life's, 6.1% of Aviva's, and 5% of New Ireland's. (Standard Life has not begun to disclose its sustainability metrics yet.)
Fossil fuel companies have engaged in a massive, decades-long campaign to promote doubt & misinformation about climate change and to block climate action both in Ireland and globally. They’re doing this in the service of their shareholders, mostly institutional investors like IAPF’s members.
In company pension schemes, a significant amount of power to affect change is held by a small number of people - namely employers and their pension providers. Mr Loughran added, “I feel like I have no control over where my hard-earned money is going. I have a pension because I want to ensure financial stability in my future, but a pension scheme that invests in fossil fuels feels like a contradiction. I want a pension for my future, not against it”.
Moving Irish pension funds away from fossil fuels would allow pension-holders to have a real impact on the climate crisis. Choosing a climate friendly pension has 21 times the combined effect of giving up flying, switching energy providers and becoming vegetarian according to the UK not-for-profit campaign group Make My Money Matter.
Twenty-two-year-old activist and student, Claire Connolly, said "As a young person, why would I consider investing in a pension when it would be actively endangering my future? A pension is supposed to offer a safe, secure future but it doesn't look like that to me".
The greenwashing of pension plans has also made it more difficult for workers and employers to make more sustainable investments. According to the European Union's own insurance and occupational pensions regulator, over six in ten EU consumers don’t trust the sustainability claims of the pensions industry, or believe they are misleading. Current EU regulated classification systems allow investment in fossil fuels and nuclear power to be classified as green.
In terms of State money, Ireland's national pension reserve fund was divested from fossil fuels following the Fossil Fuel Divestment Act 2018. However, Ireland's new auto-enrollment pension scheme, to be introduced in September, will funnel vast sums of state money into private pension funds that are heavily invested in fossil fuels - a huge step backwards.
The 2019 Climate Action Plan, in response to the Paris Agreement, created Action 12 to consider how “to provide an option to pension-holders to opt for a fund which does not include fossil fuel”. However, the Department of Employment Affairs and Social Protection quietly dropped the proposal and it was never implemented.
Extinction Rebellion activist and teacher Ian Mac an Ghaill asserted: “The government’s laissez-faire approach to the pension industry has undermined the Paris Agreement and worsened the climate crisis. There are employees and employers who want to adopt sustainable pensions but it’s impossible as long as pension providers refuse to offer fossil-free options.”
Traditional investing often disregards the side effects of its funds in the name of maximising profits, when in fact, there is evidence of sustainable funds outperforming traditional ones.
Holly Eustance, a participant in the action who is also a new pension holder poses the question: “What kind of a legacy do these companies want to leave? If the pensions industry continues funding fossil fuels, they will be complicit in the destruction of our planet for all young people and future generations. We're asking them to take decisive action now to divest pension funds from fossil fuels. Let’s remember, there are no pensions on a dead planet.”
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Resources:
https://www.friendsoftheearth.ie/assets/files/pdf/divest_ireland_divestment_guide.pdf
https://www.irishexaminer.com/news/arid-41413192.html
https://www.thejournal.ie/fuelling-retirement-5953105-Jan2023/
Photo by: Ombre Reynolds
Photo by: Ombre Reynolds
Photo by: Ombre Reynolds
Photo by: Ombre Reynolds
Photo by: C Connolly
