The Church of England has announced it is unlikely to drop its fossil fuel investments, despite voices within the faith expressing concern about climate change.
The deputy chairman of the church’s Ethical Investment Advisory Group (EIAG) has responded to calls to divest from companies that extract or sell fossil fuels, at a time when other religious organisations have recently pledged to ditch their carbon investments.
In a paper due to be submitted to the General Synod, seen by Reuters, Richard Burridge argued it was better to engage with fossil fuel companies and use shareholder influence to pressure change, claiming that excluding sectors of the market would sacrifice profits.
He said 12.5% of the FTSE350 stock market index was already excluded by the church’s ethical investment policies, meaning a loss of about 0.7% per year between 2001 and 2012.
Adding oil and gas companies to the list of prohibited investments would exclude another 14.25%, he said.
“This would leave 26.5% of the index excluded from investment, and a higher risk of financial detriment.”
However, he did add that the advisory group would consider restricting which fossil fuel companies the church could do business with.
“For example, the EIAG will consider whether to recommend that the NIBs should implement, at this stage of the transition to a low-carbon economy, ethical restrictions on investment in companies whose main business is coal mining,” he said.
More than £10 million of the church’s total investments, worth around £8 billion, are currently directly invested in Shell, BP, Rio Tinto and BHP Billiton.
The Christian charity Operation Noah, which calls for complete divestment from fossil fuel companies, has frequently criticised the EIAG’s stance.
“The long held policy of engagement with companies with whom churches hold investments has achieved many things”, Mark Letcher, co-ordinator of Operation Noah’s divestment campaign, said in November.
“But what it has never managed to do is to change the entire raison d’être of a business. That’s why churches choose not to invest in tobacco, gambling or pornography.”
Quakers in Britain have announced their support for Operation Noah, saying that fossil fuel investment is ‘incompatible’ with Christianity and low-carbon goals.