By the narrowest of margins, the 221st General Assembly’s Immigration and Environmental Issues Committee has recommended the Assembly refer an overture urging divestment from fossil fuel companies to its Mission Responsibility Through Investment Committee.
In a show of hands vote Tuesday, a motion to refer the matter passed by a margin of 30 to 29. Most commissioners speaking against referral cited urgent environmental threats and the need for the Assembly to take action quickly.
“We as a church need to show moral leadership on these issues,” said Helen DeLeon, a commissioner from the Presbytery of New Covenant.
Those favoring referral noted the expertise of MRTI and their confidence in the church’s process for socially responsible investment. Speaking in favor of referral, Scott Phillips, a commissioner from the Presbytery of Plains and Peaks, said, “I am torn because I understand the urgency, but I also know that we want to make decisions responsibly.”
The overture, submitted by the Presbytery of Boston, calls for the Presbyterian Church (U.S.A.)’s Board of Pensions and Foundation to immediately stop new investments in fossil fuel companies and to remove all investments in coal, oil and gas companies within five years. “If fossil fuel companies simply fulfill their business model, the earth will become irreversibly inhospitable to life as we know it,” the overture warns.
MRTI, a standing committee of the General Assembly, implements GA policy regarding socially responsible investing. It engages in practices such as correspondence, dialogues, voting shareholder proxies and shareholder resolutions when corporate behavior is in conflict with church policies. If engagement with a corporation is unsuccessful, the committee may recommend divestment to the General Assembly.
In their comments on the overture prior to the Assembly, the Board of Pensions and the Foundation expressed concerns about the overture and asked that it be referred to MRTI. Representatives from the groups repeated that recommendation to committee members.
Andy Browne, vice president and corporate secretary for the Board of Pensions, told the committee that the board has seen the corporate engagement process work many times.
“We don’t believe corporations by definition are bad,” Browne said. “People don’t go to work every day wanting to work for the evil empire. They want to do the right thing. They need help from people like the Presbyterian Church to show them what the right thing is.”
The Foundation shares the overture’s goal of a better environment, said Rob Bullock, the organization’s vice president for marketing and communications. However, he stressed that immediate divestment would have serious consequences for its work.
One of the major concerns, he said, is the limitations that it would place on the Foundation’s options for investment in commingled funds, investments in assets from several accounts that are blended together. Commingled fund investors benefit from lower trading costs and diversification. Most commingled funds have fossil fuel stocks in their portfolios, Bullock said.
Judy Freyer, chief investment officer for the Board of Pensions, said the church would lose its ability to influence fossil fuel companies if the church divests from them.
“If you don’t own shares, you give up your seat at the table and you won’t be able to dialogue with these companies anymore,” she said. By referring the matter to MRTI, the PC(USA) would also have the opportunity to invite ecumenical partners to join the church in its engagement with fossil fuel companies.
Thus far, only one U.S. denomination has committed itself to divestment from fossil fuel companies. The United Church of Christ’s General Synod during its gathering last summer approved a plan for fossil fuel divestment.
In an action taken late Monday, the committee voted to send an amended version of an overture from the Presbytery of Southern New England to the full Assembly that affirms “sustainable development through faithful stewardship of natural resources and the ‘Precautionary Principle.’” The Precautionary Principle is a precept that holds an action shouldn’t be taken if scientific evidence suggests the results could be dangerous.
The recommendation requests the Assembly to direct the Advisory Committee on Social Witness Policy to commission a study group to review the Precautionary Principle. The group would be asked to examine the principle’s relationship to “emerging biotechnical developments and existing Presbyterian social witness policy on environmental ethics.” The group would also be directed to prepare a study paper for congregations that would inform their advocacy efforts.