Ethical Consumption in the News: May 2017

“I see in the near future a crisis approaching that unnerves me and causes me to tremble for the safety of my country…corporations have been enthroned and an era of corruption in high places will follow, and the mone.png

This month’s ethical consumption news features stories on environmental, animal rights, and human rights issues in consumption and investment. The eleven stories featured this month are: (1) a not guilty verdict was reached in the Toronto “pig trial”; (2) more cities and banks divested from Dakota Access; (3) an article evaluated the performance of organic agriculture; (4) Portland voted to end all corporate investment; (5) Divest Parliament grew in the UK; (6) private prison divestment, while still small, has been promoted at several high-ranking US universities; (7) the petroleum industry hit back on fossil fuel divestment; (8) more religious groups announced fossil fuel divestment; (9) crickets have entered Toronto’s food scene; (10) Sainsbury piloted a plan to drop Fairtrade; and (11) Pakistanis are boycotting Ramadan fruit price spikes. For the full run-down, click here.

Hot-button Bling: Boycott Telus Explained

Yesterday Telus tweeted in support of a federal government announcement that provinces must put a price on carbon by 2018. This prompted a call for boycotts by those that oppose the government’s position. Although the boycott itself is small, and appears likely that it will not change Telus' position on carbon pricing, it is an example of how boycotts are increasingly a result of companies’ positions on “public” matters, rather than their conduct as businesses.

What happened?

Yesterday Telus tweeted:

And, as you can see I favourited the tweet... #fulldisclosure

And, as you can see I favourited the tweet... #fulldisclosure

This Tweet accompanied a statement by Smart Prosperity supporting Prime Minister Justin Trudeau’s announcement that by 2018 every province would need to have a price on carbon, or else the federal government would implement one. Smart Prosperity is an organization Smart Prosperity is a movement that seeks to promote transformation toward sustainability in Canada. As the Tweet notes, Telus had been a participant in Smart Prosperity from the beginning. But so has Shell Canada, which is a major funder of the initiative. The statement itself had been signed by individuals from companies such as McKinsey, Unilever Canada, Desjardins Group, RBC, and Loblaws.

The “boycott” thus far is relatively small, with just 200 or so social media users Tweeting about it (although admittedly one of these was Ezra Levant) in the first 24h following the tweet. But this was already enough to prompt Telus to Tweet an apology:

Throughout the day the boycott campaign grew, though it has not, to my knowledge, trended on Twitter at any point. It does now have a hashtag (#boycotttelus) and a website And MP Michelle Rempel issued a statement criticizing Telus in the House of Commons, presumably because of the attention the issue has received on social media. As is common for boycotts on social media, a counter-boycott hashtag (#boycotteverything) has also developed.

What’s the context?

This, of course, isn’t the first time that a company has spurred boycott calls for its position on issues that are perceived as being “too political”.

You might remember a similar social media boycott campaign that Tim Hortons was caught up in about a year ago. The company had been airing oil sands ads on their in-house television screens. Following complaints from environmentalists the company opted to stop showing the ads. That decision then spurred boycott calls from supporters of the oil sands in Alberta, who viewed the move as unpatriotic.

Another more successful movement, #boycottEarls, pushed the Western Canadian restaurant chain to backtrack on its decision to cease buying Alberta beef.

Internationally, bigger boycott campaigns come to mind. For instance, last summer US retailer Target announced that it was changing its bathrooms policy to allow transgendered individuals to choose their preferred bathrooms. Americans opposing this new policy created the grassroots #boycottTarget movement In the quarter during which the boycott occurred, Target lost around 2.2% of same-store transactions, while sales fell 7.2% (although this might not all have been due to the boycott).

Why do companies take positions on policy issues like climate change?

Companies do sometimes take positions on policy issues or participate in groups that work to resolve policy challenges. Because oftentimes these problems cross national boundaries, they are referred to by experts as global public policy networks (GPPNs). For example, companies such as Intel and Apple have participated in policy discussions about conflict minerals with governments, NGOs, and other actors through the OECD. The reason that companies participate in these initiatives usually is that their business activities have some effect on the policy problem. Oftentimes they are responding to consumer demands through things like boycott campaigns, but other times they are seeking to influence government policy, or to carve out a niche in the market by looking like leaders in a given area that consumers care about (say, sustainability).

Climate change is an interesting issue because it is about all of the resources we use, and because it is a cross-cutting challenge that will affect many areas of our lives. So, potentially the activities of every company are relevant to combatting climate change. 

As a boycott campaign, #boycottTelus seems likely to be small and ineffectual. Telus may think twice about sharing its positions on social media, but it has not signalled willingness to retract its position on carbon pricing nor does it seem likely that it will denounce Smart Prosperity. What is interesting about the Telus boycott is the framing: this boycott campaign contributes to an ongoing debate about when it is appropriate for companies to take policy positions, especially for an issue like climate change. 

United Church of Canada Goes Fossil Free

On 11 August 2015 the United Church of Canada announced that it will divest from fossil fuels. This means that it will sell $5.9 million in fossil fuel assets and commit to building an investment portfolio that promotes renewable energy. This is big news, as the United Church is one of the largest religious groups in Canada.  

As an Albertan, I am deeply aware of the trade-offs implied in moving away from fossil fuels: leaving oil in the ground might be necessary to avert climate change but this could have steep implications for many workers in Canada’s resource-dependent economy. The point of this post is not to proselytize about the virtues of divesting from fossil fuels. Instead, I want to use this opportunity to explain divestment; the fossil-free divestment movement; and the likely impact of this move by the United Church of Canada.

This post is a bit different than the previous two, as it does not focus on a specific product (don’t worry: I’ll be putting out a piece on sustainable seafood very soon).

Explaining Divestment

“Divestment” or “divesting” is a socially motivated activity that can be undertaken by private wealth holders. These can be individuals or groups (such as university endowments, foundations, and public pension funds). When actors divest, they withhold their capital from companies that are viewed as contributing to the identified social harm. Perhaps the most famous ongoing divestment movement is the BDS Movement pertaining to Palestine, but divestment campaigns have also targeted Apartheid in South Africa, Darfur, and tobacco.

Evidence suggests that the direct financial impact of divestment is limited, and this is likely to be the case for fossil fuel divestment. However, such campaigns typically generate indirect effects, such as increased public awareness and dialogue, new legislation, and spillover market consequences.

Divestment is often undertaken by groups set up to serve a social purpose, rather than private companies. For this reason, foundations, faith-based groups, governments, and universities have traditionally been key sources of divestment.

Up for debate: is divestment a legitimate choice for a foundation to make, or should endowment managers seek to maximize the financial return that can then be given out as a grant to socially beneficial projects?

There is an ongoing debate about the legitimacy of divestment (and other forms of socially responsible investment) for foundations, an organization type that commonly engages in divestment. Decisions by foundations to divest (or not) matter because these organizations operate by investing sizeable endowments in the market, using the annual return to give out grants for socially beneficial projects. Foundation endowments are sometimes very large: In the U.S., 85 philanthropic foundations have total assets above $1 billion USD. The Gates Foundation, which is the largest philanthropic foundation, has over $41 billion in total assets. These are sizeable funds being invested to serve an ostensibly social mission.

Endowment managers often feel compelled to maximize returns and minimize risk, as the size return that they acquire may dictate how much that foundation can spent on providing grants over the next year. However, it has been increasingly argued that foundations have a responsibility to manage their investments in a way that accords with their social missions. However, it is not always easy to translate this aspiration into practice, partially because the social impact of businesses is often diffuse. This is all linked to the emergence of a similar, but distinct, issue: social finance. If you’re interested in learning more about social finance, check out the articles I wrote here and here.

An example may help to put in perspective how difficult it is to balance the social mandate of the foundation with socially responsible investment decisions. The Gates Foundation – the mission of which is to improve the quality of life of individuals worldwide – has stated that it directs its investment managers not to invest in companies whose activities contribute centrally to egregious activities. As such, it does not invest in tobacco stocks. However, this does not mean that the endowment is only invested in socially responsible companies: the Gates Foundation was recently criticized for investing $1.4 billion USD of its endowment in fossil fuels.

While some foundations have opted to divest from fossil fuels, many others may feel that this issue is not sufficiently close to their social mission; may disagree with the divestment approach; or may feel that maximizing funds available to disburse as grants are most important. These same considerations often influence the decision of other socially-oriented organizations, such as faith groups, non-profits, universities and government agencies, as well.

The Fossil Fuel Divestment Movement

Fossil fuel divestment (going “Fossil Free”) is a divestment movement launched in 2012 under the mantra that “if it’s wrong to wreck the climate, then it is wrong to profit from the wreckage.”[1] The movement has since grown globally to reach $50 billion in divestment commitments from 800 global investors as of October 2014.[2] It is, however, worth noting that many commitments have not yet resulted in the actual reallocation of investment capital.[3]  

According to, 349 institutions are currently divesting. As the chart below shows, the four largest groups of divesting organizations include: foundations, faith-based groups, governmental organizations, and education institutions (colleges, universities and schools).

This movement is also growing in Canada, albeit more slowly than in some other countries.

The fossil fuel divestment movement is growing across Canadian universities: there are 34 active divestment campaigns operating on campuses across nine provinces. While more than 30 universities worldwide[4] have divested from fossil fuels, none of these are Canadian institutions. University of Toronto may become the first Canadian university to divest from fossil fuels (although Concordia University has initiated a $5 million sustainable investment fund). Following a petition submitted by a student group ( University President Gertler struck an advisory committee in November 2014. The committee will bring its recommendations to President Gertler by December 2015. The University of Toronto currently has $32 million invested in fossil fuels, of a $1.5 billion total endowment.

Amongst municipal governments, Victoria is leading the charge toward fossil fuel divestment. In July 2015 the city council voted to pursue options to divest from fossil fuels. 

While the fossil fuel divestment movement has gained momentum, it remains controversial, including amongst experts. Although some advocate further support for this movement,[5] others argue that it could draw attention from more effective ways to encourage low-carbon energy.[6] Still others posit that it is unrealistic to expect that all fossil fuels be left in the ground, and instead argue for divestment against coal specifically (coal has the most negative environmental and public health effects of any fossil fuel). Coal divestment has gained momentum recently, with two notable victories: the movement was endorsed by Sir Mark Moody-Stuart, the former chairman of Royal Dutch Shell[7] and Norway’s gigantic sovereign wealth fund (the largest in the world, at $890 billion) agreed to divest from coal.[8]

Churches for Action to End Climate Change

The United Church of Canada is by no means the first faith group to go fossil-free. As noted above, faith-based groups account for a quarter of all fossil fuel divestment. And Christian groups specifically have been among the leaders of the fossil-free movement. Other notable divestment commitments this year have come from the Church of England (opted to blacklist coal and oil sands investments) and the U.S. Episcopal Church (voted to divest from fossil fuels).

The United Church of Canada is not the first faith group to pledge to divest from fossil fuels. Eight other Canadian faith groups have made divestment commitments, including one other nationwide faith group: the Canadian Unitarian Council, which divested from fossil fuels in 2012. Nonetheless, this is big news as the United Church of Canada is the largest Canadian faith group to divest from fossil fuels to-date.

Why now? An important background condition might be the upcoming Paris summit on climate change (COP21), which will take place in December 2015. If it is successful, this summit could break the deadlock to deliver a meaningful multilateral climate change treaty, following a weak agreement at Copenhagen in 2009 and the arguably failed Kyoto Protocol.

Some faith organizations, including several Christian denominations, have taken a very active stance against climate change ahead of this climate summit. They have framed ending climate change as a moral imperative, a call to conscience. As an example of this, Pope Francis has released a papal encyclical on the environment in which he demanded swift action on climate change.

The divestment commitments made this year by the United Church of Canada and other faith groups can be seen as a way to signal the importance of this issue and to raise public awareness about climate change ahead of COP21. Only time will tell whether this is an effective strategy. For the moment, the $5.9 million that the United Church of Canada will divest from fossil fuels is a noteworthy new commitment in a country that has been sluggish on going fossil-free.


[1] Ritchie, Justin and Dowlatabadi, Hadi. (January 2015). Fossil Fuel Divestment: Reviewing Arguments, Implications and Policy Opportunities. Victoria: Pacific Institute for Climate Solutions at p.5.

[2] Politics and Government Business. (9 October 2014). Divest-Invest; Fossil Fuel Divestment Hits $50 Billion Mark. NewsRx.

[3] Ritchie and Dowlatabadi supra note 1.

[4] Tollefson, Jeff. (6 May 2015). Fossil-fuel Divestment Campaign Hits Resistance. Nature 521(7550).

[5] Rusbridger, Alan. (15 April 2015). Scientists Must Speak Up on Fossil-fuel Divestment. Nature 520(7547); Darby, Megan. (14 August 2015). Former EU Climate Chief Hedegaard backs Fossil Fuel Divestment. The Guardian.

[6] Tollefson supra note 3.

[7] Matthews, Chris. (5 June 2015). Shell’s Former Chairman Made a Startling Comment About Climate Change. Fortune.

[8] Schwartz, John. (5 June 2015). Norway will Divest from Coal in Push Against Climate Change. The New York Times.