Following a similar model to our project here at Super Switch, the Fossil Free Funds initiative has been launched by US non-profit As You Sow. The project makes it simple for users to research their exposure to fossil fuel companies through the holdings of their investment funds. Tools like these are hugely important for people to understand how their money is being invested, enabling them to take divestment action to align their money with their values.
Due to the strict disclosure requirements for exchange traded mutual funds in the States, Fossil Free Funds is able to analyse and profile funds with the help of comprehensive and up to date holdings data. While there is legislation in the pipeline that would require complete and regular disclosure from Australian super funds, they generally only disclose their top 10 to 20 holdings at the moment.
The Fossil Fuel Funds website profiles the iShares MSCI Australia fund, which includes Australia’s 70 largest stocks. So while it is more concentrated than the ASX200, it still provides a good representation of the local market. According to Fossil Free Funds, 10 out of the 70 MSCI companies are flagged as dirty fossil fuel proponents, making up 18.85% of the fund.
The bulk of this is made up of holdings in companies that feature in Fossil Free Indexes’ Carbon Underground 200, which is the top 100 coal companies and 100 oil and gas companies listed by the potential carbon emissions of their reported reserves.
The MSCI listed companies that make the Carbon Underground shame list are BHP Billiton, Wesfarmers, Woodside Petroloeum, Rio Tinto, AGL and Santos, while Fossil Free Funds also flags Origin, APA, Caltex and WorleyParsons as dirty holdings.
If you have holdings in US mutual funds, we urge you to use the site to see what you own, and take acton by urging the fund to divest, or switching your money to a fossil free fund.