Money talks, as the saying goes. But how is your money speaking out for the environment in the hands of others?
Collectively, we entrust huge sums of money to banks and pension funds. When we chose these institutions, we probably checked their rates and fees, or had a look at their website. But only rarely do we ask how our money is being invested for a more sustainable future.
Market Forces is helping shine a light on this critical area for people across Australia and Asia.
Based in Australia, Market Forces is an environmental advocacy organisation targeting banks, superannuation funds and insurers funding the expansion of fossil fuels, encouraging an urgent shift to fund renewable energy and sustainable options.
So where did it all start?
Ten years ago, Market Forces was formed to target not just fossil fuel companies and climate wrecking projects directly, but their sources of funding.
Fast forward 10 years, Market Forces has employees working across Australia, Asia and the Pacific. A team of analysts conduct research into the financial sector’s investments in fossil fuels and provide frameworks to hold them accountable.
Market Forces has galvanised tens of thousands of people to demand their financial institutions invest in a safer future for the climate.
These people are shareholders, bank customers, and pension fund members. They’re business owners, doctors, and teachers. They’re mums and dads, grandparents, and school students. They’re you and me, and our family and friends.
Anyone can be a force for good on the market. But how exactly?
Banks must invest in a clean future
Most people I know wouldn’t directly lend their money to a massive new coal mine. Or the largest new gas project in the country.
But so many of us are lending our money to these destructive projects through the intermediary of our bank or pension fund, and the outcome is the same.
Between 2016 and 2020, ‘the Big Four’ banks in Australia loaned $44.4 billion dollars to the fossil fuel industry. Notably, this is after the banks pledged to the goals of the 2015 Paris, committing to net zero carbon emissions by 2050.
So, does this mean we have to cancel our banks or other financial institutions? It turns out there is a range of actions that can be taken.
Like with any important relationship, clearly communicating what the issues may be, and honestly engaging with our bank or pension fund is the first step.
Next, we can ask for accountability with a reasonable time frame for action. But if the bank or pension fund does not outline a clear pathway and timeline for meeting its net zero commitments, then it may be necessary to shift our funds elsewhere.
Over the years, Market Forces has lodged dozens of shareholder resolutions with banks and fossil fuel companies, demanding disclosure on how they will meet their net zero commitments. More shareholders and big investors are concerned with how we are going to protect the planet.
Pension funds must pull their weight
In recent years, Market Forces and other organisations have been turning up the heat on superannuation funds, also known as pension funds, to end their investments in the expansion of fossil fuels. All Australian employers must contribute to compulsory savings accounts.
In Australia, Canada and many countries, the amount of money held in pension funds is colossal. And so is the impact of the investments.
In Canada, the total pool of pension funds tops a whopping CA$4 trillion dollars, according to the Canadian Pensions Dashboard for Responsible Investment. Australian super – pension funds are not far behind, with at least AU$3.3 trillion under management.
You’d be hard pressed to find bigger pots of money. And yes, maybe what you have invested doesn’t seem all too impactful on its own, but when individuals join and demand that their banks and superfunds no longer invest in expanding fossil fuels, we are seeing the impact as commitments are slowly being followed through to divest from companies harming the planet.
Pension fund members demand a safer future
Rod and Sue are two of the thousands of people working with Market Forces. They work in the health industry, running a not-for-profit called ‘Able2’ that supports people living with a disability.
They’re also long-time HESTA members, the main pension fund of the health industry.
Last year, in collaboration with Market Forces and the Environmental Defenders Office, Rod and Sue wrote a legal letter to HESTA raising serious allegations that their fund was engaged in misleading and deceptive conduct by claiming to be a climate leader while investing their retirement savings in coal, oil and gas expansion.
“The greenwashing just makes me feel patronised,” said Sue Campbell-Ross. “HESTA says they’re a leader in climate action, but they’re not,’’ explained Sue, referring to the 2 billion dollars HESTA has invested in companies actively expanding fossil fuels.
“I feel HESTA is not being clear with its members about the fact that they are investing in oil and gas.”
Rod and Sue are not alone in their concern.
Dr Richard Barnes is a Paediatric anaesthetist and also a HESTA member. After failed engagement with HESTA, he’s gone a step further and chosen to withdraw his retirement savings and has chosen a pension fund with more sustainable options.
“I’ve decided to move my retirement money elsewhere, where I can be sure it won’t be supporting fossil fuel companies,” Dr Barnes said.
The investment decisions of many of the biggest pension funds just don’t make sense. Countless people are telling us that we don’t work our whole lives to be good people while investing our life savings in life destroying companies. It just doesn’t add up.
But we shouldn’t need to dump our banks and superfunds. We need them to dump companies expanding fossil fuels.
Ultimately, Market forces are made by people; bank customers, pension fund members, and shareholders. We can all make simple steps to demand that our funds are invested in a safer future for the climate and our children.
We are all seeing the devastating impacts of worsening climate disasters, from wildfires to severe floods and hurricanes. We must all play a role in holding our banks and pension funds to account to protect our precious planet earth.
Banks comparison table
Fossil fuel investments – where does your bank stand?
Super funds comparison table
What future is your super funding?