Ethical Consumption in the News: March 2017

It’s been a long hiatus, but ethical consumption in the news is back! Here are the top stories this month: (1) Ireland may be the first country to divest from fossil fuels; (2) Norway’s pension fund has foregone returns due to its socially responsible investment policies; (3-5) several universities are acting on fossil fuel divestment; (6) Berkeley takes aim at the US border wall; (7) Shell sells oil sands; (8) US activists call for boycotting Mexican shrimp; (9) a pro-BDS group is suing the British government; and (10) a Spanish retail chain passes MSC certification.

1. Ireland may go green

The Irish Parliament is considering whether to divest its 8 billion EUR sovereign wealth fund – the Ireland Strategic Investment Fund – of all fossil fuel holdings. If the bill (the Fossil Fuel Divestment Bill) passes, it would be the first country to fully divest from fossil fuels. Norway’s sovereign wealth fund has a responsible investment policy that includes coal divestment, as well as other ethical issues (for more on this click here; on fossil fuel divestment generally click here).

2. Norwegian Pension Fund’s ethical choices reduced returns by 1.1%

In related news, a recent estimate suggests that Norway’s Government Pension Fund Global (GPFG) has generated 1.1% less in equity returns between 2006 and 2016 as a result of excluding stocks on ethical grounds. Although the policy may still be worthwhile, this finding is important because it provides evidence a recent claim that ethical investing can be done without sacrificing financial returns. 

3. University of California divests additional $150 million from fossil fuels

The University of California has divested an additional $150 million in fossil fuel investment. In 2015 the University had divested $200 million from coal and oil sands investments. UC also divested from two companies that are building the Dakota Access Pipeline, as have other actors like the City of San Francisco and a Norwegian public sector employee union pension fund.

4. Columbia University divests from coal

Columbia University Trustees announced that the university will divest from companies that derive more than 35% of their revenue from the production of thermal coal.

5. First Canadian university divests from fossil fuels

The University of Laval became the first Canadian university to divest from fossil fuels. Fossil fuel divestment is gathering momentum on campuses around the world, but especially in Anglophone countries (for instance, Bristol University agreed to new fossil fuel divestment plans this month).

6. Berkeley divests from the US-Mexico border wall

The City of Berkeley, CA passed a resolution condemning the proposed US-Mexico border wall, and calling on the City to divest from companies involved in building it. The aim of the policy is to dissuade businesses from pursuing involvement in any stage of border wall construction. A similar bill has been introduced at the state level in California.

7. Shell sells out of the oil sands

Shell has sold most of its oil sands assets, $7.25 billion, to Canadian Natural Resources. There has been some debate regarding the motive of the sale: some argue that the primary rationale was price – the high cost of oil sands extraction coupled with low oil prices – or emissions – whether Shell sought to shed the high GHG emissions associated with oil sands extraction. Shell has been taking strides to improve its environmental reputation. Whichever interpretation is correct, there has been some concern about CNR’s safety record in light of the sale.

8. US activists call for a boycott of Mexican shrimp

Conservation groups are calling on US consumers and seafood companies to boycott Mexican shrimp in a bid to save a rare porpoise – the vaquita porpoise – that is on the verge of extinction. The boycott was called because Mexico’s ban on gillnet fishing in the vaquita’s habitat is set to expire and has been poorly enforced.

9. A Pro-BDS group is suing the British government

Last year the UK government issued a new procurement policy barring government agencies from implementing boycott policies. The policy was intended to be targeted at BDS, but could potentially apply to boycotts of different kinds. The policy wasn’t the only attack on BDS in 2016. Jewish Human Rights Watch (JHRW) had sued three local councils in England and Wales, each of which had passed resolutions to boycott goods produced on Israeli settlements in the West Bank. However, in summer 2016 the court ruled against JHRW, dismissing claims that such bans were discriminatory against Jews.

A group called the Palestine Solidarity Campaign (PSC) challenged the new UK Government policy in December 2016. It is “seeking judicial review of the changes to the rules governing Local Government Pensions Schemes (LGPS) that will prevent ethical decision making with regard to human rights abuses and the arms trade”, the group said in a December 2016 statement. This month the UK Government was unsuccessful in having the case dismissed, so it will go to a full trial this summer.

Whatever your position on BDS, one has to admit that the evolving use of legislation and the court system is an interesting development for political consumerism advocacy. Whether policies like the one in the UK pass legal muster will potentially shape the advocacy terrain for a variety of social and environmental issues. Amid rising anti-Semitism it is increasingly popular – or at least there is an arguably more pressing public policy rationale – for governments to take efforts to restrict BDS. However, these laws have consequences for consumer and investor activism of all types, and for freedom of expression more generally.

10. First retail distribution chain in Spain is MSC-certified

Eroski became the first Spanish retail distribution chain to pass a Marine Stewardship Council (MSC) chain of custody certification audit. MSC is the most well-recognized and respected sustainable fish ecolabel (for more on MSC click here).