Campaigners call for Sunderland City Council's pension fund to pull millions out of fossil fuel companies ahead of COP26

According to pressure group Divest UK, the Tyne and Wear Pension Fund, which serves Sunderland and its neighbouring councils, has £238million of its £8.5billion total invested in fossil fuel companies, which is about 2.8%.

And as world leaders prepare to meet at COP26 in Glasgow to discuss ways of tackling climate change, campaigners want councils to demonstrate their climate credentials and ‘divest’ money from industries they say are harming the planet.Robert Noyes, an energy economist at campaign group Platform and a coordinator UK Divest, said: “While their net-zero adverts are appealing, not a single fossil fuel company has implemented measures to comply with the 2015 UN Paris Agreement, while in 2020, on average these companies spent just 1% of their annual capital expenditure on clean energy.

“There is no change coming from continued engagement, there is only delay.

“With support for climate action at an all time high, and the financial benefits of fossil fuel funding increasingly unclear - the choice is as easy as it is simple: divest from fossil fuels, join the $14.5tn coalition of climate leaders in drawing a line, and invest in a future worth retiring into.”

He added: “As we approach the UN climate talks in Glasgow this November, local councils have a simple choice.

“They can pay polluters to wreck the planet, or they can play their part in the global climate effort by ending their fossil fuel investments.”

However, Sunderland City Council defended its record on tackling climate change.

Its Cabinet Secretary, Councillor Paul Stewart ,said: “Alongside the city council, public and private partners signed-up to a Low Carbon Framework in December 2020.

“This framework is to help drive down emissions and seek to make the city carbon neutral over the next ten years.

“Here at the council we are lowering emissions, such as through our growing fleet of electric vehicles (EVs).

“In the low-carbon economy, Sunderland is a key player and we have an expanding EV hub that is supporting and accelerating these changes to low carbon.

"The importance of this hub was confirmed recently with the announcement on the new Envision gigafactory for manufacturing EV batteries.”

And a spokesperson for the Tyne and Wear Pension Fund said it was already taking action to improve the climate credentials of its investments.

They said: “The Pensions Committee has a fiduciary duty to both employers and members to seek an appropriate financial return for the level of risk that is taken.

"The pension fund recognises that climate change is a significant financial risk and actively engages with the companies in which it invests to help reduce carbon emissions.

"The fund has used its votes at company AGM’s to promote climate change issues and has collaborated with other likeminded investors to support climate change resolutions.

“The committee has recently undertaken a carbon footprint of the Fund’s investments and this shows that carbon emissions intensity has fallen by nearly 30% from 2010 and by 8% over the last two years. Further reductions will be targeted going forward alongside the setting of a net zero carbon target.

“One reason for the recent reduction in emissions is that last year the Fund invested £650million into the Future World Index Equity Funds, as part of its ongoing commitment to generating sustainable long-term returns in a responsible manner.

"This range of funds invests more in companies that score well against environmental, social and governance criteria including companies, which are less carbon-intensive or earn green revenues.”

A spokesperson for the Department for Work and Pensions added: “We are encouraging organisations to commit to net zero in a way that works for them, and to publish a plan for doing so.

“Pressure to comply with Government-set mandatory targets would undermine trustees’ duty to invest in the best interests of their members, and would likely force immediate divestment from some stocks - regardless of whether the company is showing meaningful attempts to reach net zero or not.”