We can make a US clean-energy economy a reality by refusing to invest in companies that are destroying our planet. By shifting our investments into clean energy and support public policies that move us away from fossil fuels, we can simultaneously protect our assets and the environment.

Green America is proud to partner with 350.org and the DivestInvest Campaign. Here’s how to get a started:

If you are invested in mutual funds, switch to fossil fuel free funds and urge your current fund companies to offer fossil fuel company-free options. To ensure your portfolio remains balanced and geared toward your financial goals, work with a financial planner or asset management firm that understands the importance of fossil fuel company divestment.

1. Divest Your Fossil Fuel Holdings: The definition of fossil fuel free investing has evolved over time. Many investors start with partial divestment as they move towards a fossil fuel free portfolio. As You Sow, the organization that created the online divestment tool FossilFreeFunds.org, outlines several approaches to fossil fuel divestment:

    

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   • Divesting of the Carbon Underground 200 - the top 200 companies that control the largest coal oil and gas reserves. The list is compiled and maintained by Fossil Fuel Indexes.
   • Divesting of the Macroclimate 50 - the top 50 companies that own coal-fired power plants. The data for this list is compiled by the Global Energy Observatory, and the list is maintained by Macroclimate®.
   • Divesting of Morningstar-identified fossil fuel industries: oil and gas, which includes drilling, exploration, processing and transportation, marketing, and equipment and services; coal, which includes companies engaged in mining coal; and utilities, which includes independent producers, and regulated electric and natural gas transmission, storage, or distribution companies.

2. Make Your Banking & Credit Cards Fossil-Free: Many conventional mega-banks invest in fossil fuels. You can bank with a community development bank or credit union that is fossil fuel company-free and that helps local communities prosper. Visit BreakUpWithYourMegaBank.org for information on switching your accounts. If you use a credit card, be sure it is from a community development credit union that supports people and the planet. Visit TakeChargeofYourCard.org for information on green credit cards.

3. Reinvest in a Clean Energy Future: There are a growing number of investment products that are free of fossil fuel companies and support clean energy investment and efficiency. Use the list of financial services companies below to find funds, certificates of deposit, ETFs, and service providers who can help you create a portfolio that meets your needs. Most of the companies are certified members of Green America’s Green Business Network.

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As the effects of climate change worsen and more governments move to tax and limit carbon emissions, fossil fuel companies will lose their value. Divesting from carbon in your portfolio will help you avoid the risks of devalued carbon assets. A recent economic analysis from investment consulting firm Mercer has shown that climate change will have a significant effect on pensions and other fund returns. The analysis also concludes that trustees' failure to respond to climate change risks could result in a breach of fiduciary duty.

Notably, the Rockefeller Brothers Fund (RBF), which announced in 2014 that it would align its investments with its mission and therefore divest from fossil fuels, has experienced positive results from divesting. Its performance record is detailed in a five-year case study titled Investing in Our Mission. Published in 2020, the case study found that the foundation’s portfolio significantly surpassed the market benchmark during this period as fossil fuel holdings were slashed to less than 1% of the portfolio.

The RBF media release stated:

“When we joined the divestment movement, we were convinced that a more profitable and less risky investment portfolio could be constructed without exposure to fossil fuels,” said Valerie Rockefeller, great-great-granddaughter of John D. Rockefeller and chair of the RBF board of trustees. “Now we have five years of financial data to back it up.”

“Oil is obviously a definitional part of my family’s past,” said Rockefeller. “But it has no place in our future.”

"The logic of divestment couldn’t be simpler: if it’s wrong to wreck the climate, it’s wrong to profit from that wreckage."

Bill McKibben, climate activist, author, founder of 350.org

Are you ready to join the movement to divest from fossil fuels?

Let your voice be heard.

Take the pledge.

Divesting sends a clear message: fossil fuels are toxic to people and the planet, therefore they are toxic to our portfolios. Divestment forces CEOs and politicians to take notice because it signals the importance of an issue to consumers and constituents. The environmental, public health, and financial risks of fossil fuels mean we need to continue to pressure investors by divesting from fossil fuels.

Five Reasons to Divest

Align Your Assets with Your Values

"If it's wrong to wreck the climate," says 350.org founder Bill McKibben, "then it's wrong to profit from that wreckage." When you divest from fossil fuel companies, you align your investment criteria with the green values you put into practice in other areas of your life.

Reduce Your Exposure to Climate Risks

Studies by numerous analysts, including the London School of Economics, the Aperio Group, HSBC, and Impact Asset Management, demonstrate that fossil fuel companies may be overvalued by as much as 40 to 60 percent. Divestment from fossil fuel companies can help protect your portfolio from the potential future “carbon bubble.” (“Carbon bubble” refers to the over-valuation of fossil fuel companies. If we are successful at keeping their carbon product in the ground, then they will be unable to access the reserves on which their value is based). Additionally, climate risks could cause fossil fuel assets to lose value quickly, and trustees could be held liable for not taking these risks into consideration when making investments.

Name and Shame the Worst Companies

In Stranded Assets and the Fossil Fuel Divestment Campaign, an October 2013 report by the University of Oxford, the authors pointed out that the stigmatization of divestment targets has always been one of the key factors triggering social change.

Join a Growing Movement

Almost 700 institutions and tens of thousands of individuals have made commitments to divest in whole or in part. When you divest, you're joining one of the most critical progressive movements of our time.

Everyone Can Take Part

If you have a bank account, you are an investor. Everyone can move their money from banks that support fossil-fuel companies to banks with a community development focus. Find better banks and credit cards at Green America’s Break Up with Your Mega Bank, and find fossil-free investing resources.

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