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Is the divestment movement really hurting fossil fuel companies?

In this week's issue of our environment newsletter, we look at how effective the divestment movement is in weakening fossil fuel companies, and highlight some of the most powerful artistic statements about the environment in 2018.

Also: Canadians use a lot of wrapping paper

(Sködt McNalty/CBC)

Hello, friends! This is our weekly newsletter on all things environmental, where we highlight trends and solutions that are moving us to a more sustainable world. (Sign up here to get it in your inbox every Thursday.)

This is our last newsletter of 2018. But fear not: We will be back. Look for the next issue of What on Earth? in early January.

In the meantime, have a wonderful holiday!

This week:

  • Divesting from fossil fuels — how meaningful is it?
  • How pop culture tackled the environment in 2018
  • News flash: Canadians use a lot of wrapping paper
  • Environmental regulations aren't as costly as you think

Is the divestment movement really hurting fossil fuel companies?

(Lukas Schulze/Getty Images)

When the UN climate conference was at its darkest point last week — no new agreement and concern countries wouldn't arrive at one — one organization hoped to be a bright light.

Environmental campaigners 350.org announced that more than 1,000 companies had joined their cause — fossil fuel divestment.

"The reach and impact of this global movement is huge — major institutions with almost $8 trillion US in assets have commited to divest from the likes of Exxon and Shell," said May Boeve, 350.org's executive director, in a statement.

Like voting with your wallet, divestment has been a powerful tool. Historically, it has played a role in turning public opinion against South African apartheid and tobacco companies.

Unlike a boycott, the idea behind divestment is to cut off or move investments out of a company — in this case, ones that extract and/or burn fossil fuels for profit.

Of the few Canadian organizations on board, it's mostly faith-based groups and NGOs. (Laval University and the Canadian Medical Association are outliers.)

Eight trillion dollars worth of divestment sounds impressive, but does it make a dent, let alone a difference?

Some argue that divesting doesn't drive share prices down, and may, in fact, leave less eco-concerned investors positioned to snatch outstanding shares. It also means very little with  big oil companies that are private (and thus don't sell stock).

Energy companies have funded research suggesting it could harm your investment portfolio, a warning that could scare a pension fund, for example. But "clean capitalism" magazine Corporate Knights released a study in October estimating the New York state retirement fund would be $22 billion US richer had it divested from fossil fuel stocks a decade ago.

The fact that the chief executive of British oil giant BP recently slammed divestment suggests the industry feels threatened. So maybe the movement is changing minds.

Divestment has a role in "saying it's no longer OK for the world to say they care about climate change and then make money off of it," said Jessica Green, a political science professor at the University of Toronto.

Green says climate change has led to institutionalized pressure, meaning investors, including shareholders in fossil fuel-burning companies, demand regular reporting on climate risks and impacts.

Divestment is "shifting the baseline of what is expected of big multinationals and fossil fuel companies," Green said.

Keep in mind, divestment has never really affected its targets' bottom lines. For example, South Africa's economy didn't suffer, but divestment was part of the chorus of arguments that came together to end apartheid.

In terms of halting climate change, Green said strong government policies, investment in renewables and reducing oil and gas subsidies are better strategies to take.

"There are a bazillion different levers to pull and we have to pull all of them," said Green. Divestment "is one of them."

—​ Anand Ram


Pop culture takes a closer look at our changing planet

Making people understand the scale and unintended consequences of environmental degradation has often been a challenge — just ask the scientists who have spent the past few decades sounding the alarm about climate change.

Yet that hasn't deterred climate scientists — and it hasn't stopped artists, either. Films, visual art, books and music remain powerful means of expressing the ways we have altered the natural world and our conflicted feelings about that.

Here are three of the most powerful artistic statements on the environment in 2018.

Annihilation (film)

Based on a series of sci-fi novels by Jeff VanderMeer, Annihilation was one of the most harrowing cinematic experiences of the year. The basic plot: As a result of some sort of environmental disturbance, one part of the continental U.S. has become so treacherous and, frankly, bizarre, that it is not only uninhabitable, but slowly expanding. Natalie Portman, in the photo above, plays a biologist who is part of a small team sent to explore "Area X," which contains some horrifying mutant animals. (The film is on Netflix, though it is not recommended right after your holiday dinner.)

Anthropocene (photo exhibition/film)

In Anthropocene, photographer Edward Burtynsky and filmmakers Jennifer Baichwal and Nick de Pencier have created an exhibition that shows, in beautiful, appalling detail, how we have despoiled the Earth to satisfy our modern lifestyle. Highlights include oversize photos of a plastic landfill in Kenya, marble quarries in Italy, oil extraction in Nigeria and potash mines in Russia.

The Overstory (book)

The latest novel from U.S. author Richard Powers is unorthodox, ambitious and weirdly profound. Nominated for the 2018 Man Booker Prize, The Overstory follows characters from different walks of life — including a university student, an engineer and an eco-activist — to demonstrate our deep, healing relationship with trees. If it sounds fanciful, it is. It's also poignant. But here's the sobering takeaway: While humans may not survive an environmental disaster, the trees will.

Andre Mayer

Was there an environmentally themed piece of art that impressed you this year? Tell us about it.


Resolutions for 2019

It's a time of celebration and reflection, as well as anticipation of what the new year will bring. Do you have resolutions for 2019, specifically of the environmental variety? If so, we'd love to hear what you have in mind.

Send us a note at whatonearth@cbc.ca.


Hot and bothered: Provocative ideas from around the web

  • The UN climate conference in Poland wrapped up last weekend with the announcement of a broad "rulebook" for how countries would report their progress on cutting emissions. Environmentalists were disappointed that countries wouldn't agree to more aggressive targets. The mood was decidedly less triumphant than Paris in 2015.

  • On the sidelines of last week's climate talks, an Australian farmer named Tony Rinaudo shared his wildly effective methods of regenerating forests, a key strategy in neutralizing carbon emissions. You want mindboggling numbers? Over 30 years, Rinaudo's method is responsible for regrowing six million hectares of trees in west Africa.
  • When you think of wind power, typically what comes to mind are giant turbines. But what if this kind of energy could be harnessed in a friendlier, less imposing way? Enter "wind trees," which are the product of a French startup. And they're every bit as charming as they sound.

The Big Picture: Wrapping paper use in Canada

At this time of year, there are a lot of gifts to wrap. But how much paper do we use? According to Zero Waste Canada, we consume 545,000 tonnes of wrapping paper and bags. How much is that, actually? Well, see for yourself.

(CBC)

Environment regulations: Cheaper than you think

(Daniel Leal-Olivas/AFP/Getty Images)

What if you went to a store and when you took your item up to the till, it ended up costing you half or even a 10th of the figure on the price tag?

For one thing, you might consider shopping there more often.

Along those lines, industry often kicks up a fuss when the government proposes new environmental regulations. But an updated study released by the Smart Prosperity Institute last week found the Canadian government typically overestimates the cost to businesses of pro-environmental measures like vehicle emissions standards, measures to curb acid rain and a ban on ozone-depleting substances.

In five case studies, the Ottawa-based think-tank found the cost ended up being half to a 10th of the initial government estimate, while saving the government more money than anticipated on things like health-care costs.

"Where we have looked at actual costs and benefits, environmental regulations cost less than we think and generate more benefits than we expected," said Stewart Elgie, executive chair of the Smart Prosperity Institute and the lead author of the report.

He said it's now "commonly accepted" among researchers that the cost of environmental legislation to business is routinely overestimated.

Why? Regulation drives innovation and economic models used to generate estimates have trouble accounting for how that will reduce costs, Elgie said.

In the case of phasing out ozone-depleting chemicals under the 1987 Montreal Protocol, legislation pushed companies to find substitutes for chlorofluorocarbons (CFCs) that were safe for the ozone layer. The reason alternatives such as  hydrochlorofluorocarbons (HFCs) weren't known before is because no one was looking for them. But they ended up costing roughly the same.

Similarly, Elgie said constant innovation has led to the plummeting cost of wind and solar energy.

The Canadian Chamber of Commerce, which represents businesses across Canada, released a report earlier this year criticizing the quality of government cost-benefit analyses used to draft regulations (although it didn't suggest that overestimates were the problem).

Obviously, bad estimates don't lead to the best decisions. So what's to be done?

Elgie says he hasn't had much luck convincing governments or economists to halve their cost estimates as a matter of routine.

But the Smart Prosperity Institute and the Canadian Chamber of Commerce do agree on one thing: Governments should do more followup after regulations are implemented to see what the real costs are and whether they're providing the desired benefits.

In the meantime, the Chamber of Commerce released a new report on carbon pricing this week, making it clear that businesses support the idea and are perhaps more forward-thinking about environmental regulation than some give them credit for.

Emily Chung


Stay in touch!

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Editor: Andre Mayer | Logo design: Sködt McNalty

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