Quaker group divesting $17M from Vanguard over climate change - InvestmentNews
Quaker group divesting $17M from Vanguard over climate change
Quakers divesting $17 million from Vanguard over climate change
Earth Quaker Action Team is planning to announce the withdrawals this week at Vanguard's headquarters.
A Quaker group has promised to withdraw nearly $17 million from Vanguard Group, representing the latest public censure of the asset manager over climate issues.
The group, Earth Quaker Action Team, is planning a protest Wednesday at Vanguard’s headquarters in Malvern, Pennsylvania, marking the start of a campaign the group is calling “ Never Vanguard.”
“Campaigners will announce $16.8 million already withdrawn or in the process of being withdrawn from Vanguard in response to the firm’s inaction on climate change, with that amount expected to grow in the coming months,” the group said in an announcement.
This year, Vanguard has drawn increasing attention from environmental groups a result of the asset manager’s withdrawal last year from the Net Zero Asset Managers initiative.
In April, 16 people were arrested in connection with blocking entry points to Vanguard’s headquarters. Earth Quaker Action Team took part in that demonstration along with Extinction Rebellion Philadelphia and Fossil Free Penn, which participate in a wider campaign called Vanguard S.O.S.
“Vanguard S.O.S. is calling on Vanguard to implement a series of solutions to reverse the detrimental impacts of its investments, including leveraging its shareholder power to influence the worst polluting companies, integrating climate justice into business decisions and decarbonizing its investment portfolio,” Earth Quaker Action Team said in its announcement of the account withdrawals.
Vanguard has about $270 billion in investments related to the fossil fuel industry, which would make it the biggest single investor in oil and gas, according to the activist groups.
Vanguard S.O.S. launched an online ad against Vanguard earlier this year, exclaiming that “If it’s bad for the environment, it’s bad for your retirement.”
In connection with the wider campaign against fossil fuel investing at Vanguard, about 1,400 of the firm’s fund investors sent form letters from the Sierra Club alleging that a lack of support for environmentally focused shareholder resolutions amounted to a breach of fiduciary duty.
Vanguard did not immediately respond to a request for comment on the Earth Quaker Action Team’s announcement of withdrawals.
Although the company left NZAM, its economists have found that climate change will have a negative effect on global gross domestic product. Among more than 280 index funds and ETFs it provides, as well as 120 actively managed funds, several such products are designed to meet net zero criteria, according to Vanguard. Some of the funds also use ESG criteria as part of their overall investment process.
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Related Knowledge Center: Climate economics
Climate change is now a driver of the world’s economy. The impact is profound:
- Catastrophic weather events — hurricanes, floods, droughts, high temperatures — are more frequent and more extreme. The cost can be measured in both the initial damage caused and the longer-term impact on the economy.
- Vulnerable communities are increasing climate-related investments, hardening infrastructure and taking other protective measures.
- Investment in carbon capture and storage technologies is increasingly rapidly.
- Governments are making investments and crafting regulations to reduce emissions of carbon dioxide and other greenhouse gases.
On top of all of this is the cost of uncertainty. As the Fourth National Climate Assessment, released in 2018 by the U.S. Global Change Research Program, says, “The assumption that current and future climate conditions will resemble the recent past is no longer valid.”