Campaigners claim Southwark has not taken its fossil fuels vow seriously

By Alexandra Warren

Environmental activists have clashed with a council over their handling of pension investments.

Fossil Free Southwark and XR Southwark have criticised Southwark council for investing their pension fund in fossil fuels after pledging to divest.

Activists have said that the council have not taken their divestment commitment seriously.

Information obtained by Fossil Free Southwark showed Southwark council’s pension fund invested around £10 million in oil and gas companies since they pledged to move away from fossil fuel in December 2016.

The council has hit back at the claims saying that the investments were necessary to mitigate risk to pension holders – and that they have now been sold.

They also said that the investments made up a very small percentage – around 0.5% – of the £1.9 billion fund.

Since March 2021 they have had no active investments in oil and gas companies.

In a Southwark cabinet meeting on December 13, 2016, the Chair of the Pension Fund, Councillor Fiona Colley committed to divesting over time any current investments in fossil fuels.

At the time of the pledge, the pension fund had shares in Canadian oil company Suncor. These were sold in January 2018.

Records given to Fossil Free Southwark showed that on December 15, 2016, the pension fund invested almost £2 million in the Alaskan crude oil producer ConocoPhilips.

They continued investing small amounts of money in the company until June 2017 and divested of their shares in ConocoPhilips by May 2018.

The council also invested £3.2 million in Royal Dutch Shell in January 2018 and the records show that the shares in Shell were sold in March 2021.

Campaigners have said that the divestment took too long.

Karrim Jalali of Fossil Free Southwark said: “It’s shocking that it’s taken over four years to finally tell their fund managers to stop investing in fossil fuels.

“It’s also patently obvious that the investments shouldn’t have happened and the council got it wrong.

“It’s bizarre that they have chosen to double-down on pretending that the investments were perfectly acceptable at the same time as desperately trying to mop up the mess made from making them in the first place.

“It’s difficult to know how to continue to engage with the council earnestly when they have repeatedly refused to accept any responsibility for obvious failings.”

Eloise Waldon-Day of XR Southwark said: “This shows the council’s divestment commitment was never taken seriously enough and is yet another example of the council’s failure to treat the climate emergency as an emergency.”

Southwark have said that although the pledge was made in 2016, the investment strategy was not published until 2017, after which the divestment plans were put into practice.

Duncan Whitfield, Strategic Director of Finance and Governance at Southwark council, said that it wasn’t possible to divest all at once.

He said: “Because of the nature of these investments, you can’t just flick a switch and turn them from one thing to another, because you lose value.

“We’ve got to be clear, the main purpose of the pension fund is to pay pensioners. It’s not simply a push the button and divest, because that stands to crystallise loss.”