Greens have seized on government attempts to prevent local authorities divesting from companies deemed unethical as evidence of how being part of the EU can help move the UK in a more ethical direction.
While the government is set to ban local authorities divesting their pension funds from companies they deem unethical, the European Parliament has endorsed a Green amendment to oblige pension funds to move towards divesting from fossil fuels.
The European Parliament’s Economic and Monetary Affairs (ECON) committee recently adopted new rules on workplace pension schemes which include consideration of environmental, social and governance factors in investment decisions and risk assessments related to the depreciation of fossil fuel assets as a result of tackling climate change.
Molly Scott Cato MEP, a member of ECON and Green Party speaker on economics and finance, said:
“This is another example of the European Parliament taking a progressive position on a crucial issue while our archaic government seeks to move us in the opposite direction. The new rules agreed by the majority in the Parliament are an acknowledgement that investment decisions can be a powerful tool in driving social, environmental and economic change. But in the case of carbon-related assets we are also actually dealing with a clear and growing risk to the future incomes of pensioners.”
The new agreed rules form basis for the European Parliament´s future negotiations with the Council of ministers. Molly concluded:
“This is an interesting test for the government. Will they support moving us in the more progressive direction backed by the European Parliament, with its aims of safeguarding both our climate and future pensioners, or support their fossil friends by trying to block the proposals?”