During today’s State of the State Address, Vermont Governor Peter Shumlin called on the state’s pension funds to divest the $4.02 billion portfolio from coal, as well as from the infamous fossil fuel corporation ExxonMobil.
“Our small state must partner with California, which manages hundreds of billions of dollars of state funds, and divest Vermont of coal. Let’s remember Vermont is downwind of the coal fired plants to our West; we’re the tailpipe to their dirty energy choices,” said Governor Shumlin. “Their pollution sickens our children, creates acid rain, dumps mercury on our forests and in our lakes and increases greenhouse gas emissions. I ask that you send me a divestiture bill just like California’s. While you’re doing that, Governor Brown and I will invite other Governors to join us in what should be a national effort.”
Shumlin also specifically targeted ExxonMobil for divestment.
“While we await the California study on oil, Vermont should not wait to rid ourselves of ExxonMobil stock,” said the Governor. “It has been clearly documented that since the 1980’s, ExxonMobil’s own scientists have long known about the dangers of global warming, and chose to conceal that from the public. At the same time that they were building their oil rigs taller to account for rising sea levels, they were funding front groups of scientists to deny climate change is real. This is a page right out of Big Tobacco, which for decades denied the health risks of their product as they were killing people. Owning ExxonMobil stock is not a business Vermont should be in.”
350.org co-founder Bill McKibben responded by congratulating the Governor for his leaderhsip on the issue, “It's great that Vermont may join states like California in divesting from coal -- and even better that Governor Shumlin has taken the lead by saying no government should be invested in Exxon, as perhaps the greatest scandal in corporate history begins to unfold. Today is a great win for the thousands of Vermonters who have joined this fight, and it will give us new vigor to keep pushing on many fronts!”
The call to divest from Exxon is particularly significant following a series of investigative reports revealing that as early as the 1970s, Exxon not only knew about the effect of burning fossil fuels on the climate, but also that the company spent millions in sowing doubt and confusion around its own research among the public and world governments. Reporters recently uncovered that Exxon’s oil industry peers also knew about these climate dangers and lied about them for decades, potentially opening them up for prosecution or additional regulations.
Now, momentum is growing to prosecute Exxon for their climate lies. New York State Attorney General Eric Schneiderman has launched an investigation to uncover all Exxon knew about climate change. Last October, over 60 prominent indigenous peoples, social, and environmental organizations released a call for the Department of Justice Attorney General Loretta Lynch to launch an investigation. Organizers across the country are urging their state Attorney Generals to launch similar investigations.
Governor Shumlin’s push for Vermont to also divest from coal is part of a growing wave of divestment commitments worldwide as the case for action grows ever stronger. During the UN climate talks in December, it was announced that over 500 institutions representing more than $3.4 trillion in assets under management had committed to some level of divestment. Coal in particular has felt the pinch, as stocks have plummeted and many companies have filed for bankruptcy. There has been growing momentum for full divestment, as well, as renewable energy has gained cost efficiency over fossil fuels and Fossil Free Indexes have outperformed conventional markets. Leaders from UN Secretary General Ban Ki-Moon to World Bank President Jim Kim have commended the divestment movement for the impact it has having on the economic and political discussion about how to address the climate crisis.
The case for divestment is particularly strong in Vermont, a state that prides itself on green leadership, as well as sound accounting. In fact, not divesting may have hurt State funds since calls for action began. In November, 350Vermont and Corporate Knights found that the state pension fund lost more than $77 million in reduced returns over the past three years because of fossil fuel investments.
"The Vermont Chapter of the Sierra Club is glad to hear Governor Peter Shumlin acknowledge the need to divest from fossil fuels. In light of the Paris Climate talks it is quite evident that fossil fuel investments are volatile and there are real questions about the fiduciary responsibility of continuing to invest in them,” said Robb Kidd, VT Chapter of the Sierra Club Conservation Program Manager. “Vermont can lead by refocusing investments that align with the Vermont's clean energy goals while protecting public pensions.”
Campaigners believe that today’s announcement will provide significant momentum for Vermont’s pension funds to divest from all fossil fuels, as well as set a precedent for other states, such as New York, to follow suit.
“It is gratifying to hear Governor Shumlin’s support for fossil fuel divestment. Fossil fuel investments in the state pension funds have substantially hurt returns over the past couple of years and continue to constitute a real risk for pension beneficiaries and Vermont taxpayers,” said Eric Becker, CFA, Chief Investment Officer, Clean Yield Asset Management. “Getting on a path to full divestment in the coming years will be a great step forward for Vermont and for the climate.”
About 350Vermont: 350Vermont is a statewide organization in Vermont working to build a grassroots movement to reverse climate change. 350Vermont’s mission is to catalyze the cultural and systemic transformation needed to reverse climate change and return to 350 ppm of carbon in the atmosphere. Although we are an affiliated group of 350.org with a similar mission, 350VT is an independent organization, with local campaigns to divest the state pension fund, advocate for a carbon pollution tax, and stop any expansion of fossil fuel infrastructure.
About Vermont Chapter of Sierra Club: The Vermont Chapter of the Sierra Club is a volunteer-led affiliate of the national Sierra Club. The Sierra Club is America's largest and most influential grassroots environmental organization, with more than 2.1 million members and supporters nationwide and 9,000-plus members and supporters in Vermont. The Sierra Club works to safeguard the health of our communities, protect wildlife, and preserve our remaining wild places through grassroots activism, public education, lobbying, and litigation.
About Clean Yield Asset Management: Clean Yield Asset Management is a registered investment advisory firm based in Norwich, Vermont. Clean Yield manages socially and environmentally screened investment portfolios, including fossil fuel free portfolios, for individuals and families. It has approximately $280 million in assets under management.