Guest article by Sarah Thin, PhD Candidate at the Faculty of Law and former member of Fossil Free Maastricht
Do you know where your pension is invested? Most people don’t. It is an odd thing that pension funds, some of the most powerful financial players in the world, have thus far enjoyed a position far from the limelight. The invested assets of ABP, the biggest pension fund in the Netherlands and the 5th largest in Europe, totalled €465 billion in 2019. This is essentially the pension money of all ABP’s pension holders: civil servants, teachers, and university employees amongst others. One in 6 people in the Netherlands has a pension with ABP. Our money is held and invested by ABP as a guarantee for our future.
So what is wrong with this? The problem is the lack of control that we have over this money. ABP currently invests €16.5bn in the fossil fuel industry, with large holdings in oil and gas giants like Shell, BP, Total, and ExxonMobil. These are the same companies that have been accused of involvement in mass human rights violations, that deliberately deceived the public about climate change for decades, and that are continuing to grow rich off the very fuels that led to the state of crisis in which we now find ourselves.
Through their investments, ABP is helping to fund the activities of these companies. The money that was intended to guarantee the future of pension holders is being used to finance its destruction. We have no choice where our pensions are held – it is an automatic system. Through ABP, we are indirectly, sometimes unwillingly and sometimes unknowingly facilitating extractive, destructive, and often inhumane practices.
In 2018, a Maastricht-based campaign group decided to take this issue on. Fossil Free Maastricht is a branch of the international Fossil Free movement that campaigns worldwide for divestment from the fossil fuel industry. The divestment movement began in the USA and has quickly spread, with big wins, particularly in the USA and UK. Divestment in this context essentially means the withdrawing of investments from the fossil fuel industry and instead investing somewhere else, e.g. in renewable energy.
Thus far, as a result of these kinds of campaigns, over $48.58 trillion has been divested from the fossil fuel industry. 1326 institutions have cut their ties with fossil fuels. In the USA and the UK, much of the focus has been on universities as, in those countries, these institutions often hold big investments in their own right. In the Netherlands, as public institutions, universities themselves do not hold investments. But the pension funds of their employees do.
Back to ABP. Fossil Free Maastricht began a letter-writing campaign whereby UM staff members (automatically pension holders with ABP) would write to ABP calling on them to divest. They ran events to raise awareness, and began putting pressure on the University to take a stand against ABP’s fossil fuel investments. After their petition asking UM to make a statement to ABP calling on them to divest reached 1000 signatures, the University agreed to co-host a debate event with Fossil Free, UM, and ABP represented.
At this debate, ABP put forward their arguments against divestment. It is, they said, better to work with these companies to make them clean up their act, rather than to cut all ties. But how long do we wait for this to happen? Surely divestment must be on the table if these companies refuse to change, or take too long to do so? Otherwise there is very little leverage that ABP can use to convince them to do anything. And where is the evidence that ABP are putting pressure on fossil fuel companies at all? On the contrary, ABP has consistently voted against climate-friendly shareholder resolutions at the large oil companies. They are quite happy to accept these companies at their word, as when BP claimed they will be climate neutral by 2050, when in fact such a transformation is impossible under the current state of technology, or indeed the state of technology as it is likely to be in coming decades.
It is important to note here that oil companies are financially dependent on the continued exploitation of oil and gas reserves. Fossil fuel companies own over 2,795 gigatons worth of CO2 in fossil fuel reserves – that’s far, far more than we can possibly burn and stay within non-catastrophic levels of global warming, even at most optimistic estimates. But these companies have already paid for these reserves and are financially, existentially dependent on being able to extract and produce them: they have no interest in stopping; they can’t afford to.
In February of this year, after a long campaign by both staff and students, the University of Maastricht made an official statement calling on ABP to divest from fossil fuels. This is not the first such statement, nor will it be the last, but it is an important step. Fossielvrij Nederland has since taken on the ABP campaign as one of their primary focuses. Other universities in the Netherlands, as well as local governments, schools, and colleges, are beginning to take similar stands.
This campaign revealed hypocrisy at the very top of an institution that is intended to work for us. It also uncovered serious structural problems with the institutions that UM has set up to tackle issues related to sustainability. But it also led to important victories; to a coming together of different people and interests to protect our environment; to a demonstration of the power that we hold to make these changes.
And we need to continue with this kind of work; we need to continue making these changes. ABP still finances fossil fuels, as do many other institutions in the Netherlands, from research funds (like SWOL) to other pension funds and private actors. It has been easy to forget the climate crisis with everything that has happened in the last 18 months, but that does not make this crisis any less real or pressing. The window of time that we have to prevent the most catastrophic of climate breakdowns is rapidly closing. This is the time when we have to look to the future; to reimagine what it may look like. To save it while we still can.
