At least six overtures and one informational item will be discussed by the Environmental and Climate Justice (ENV) Committee at the PC(USA)’s 226th General Assembly meeting this summer. Committees will conduct their business in online sessions June 25-27, prior to the in-person plenary sessions, which begin on June 29 in Salt Lake City, Utah.
Fossil fuel divestment
Going back to 1976, at the 116th General Assembly of the PCUS, and continuing through reunion at the 1984 PC(USA) 196th General Assembly, guidelines for socially responsible investing and a divestment strategy were established whereby the Committee on Mission Responsibility Through Investment (MRTI) is directed to engage corporations in a seven-step process to influence them toward complying with policies advocated by the General Assembly. If adequate changes are not made, the assembly may vote to recommend investing agencies of the church – namely the Presbyterian Investment and Loan Program, Inc.; the Board of Pensions of the Presbyterian Church (U.S.A.); the Presbyterian Church (U.S.A.) Foundation and its New Covenant Trust Company – to divest from these companies.
The actions of General Assembly 225 in 2022 resulted in a targeted divestment from fossil fuel companies Chevron, ExxonMobil, Marathon Petroleum, Phillips 66 and Valero Energy until such time that “their actions comply with the General Assembly’s established criteria.” These companies were added to the denominations 2023 prohibited securities list alongside 118 other corporations.
For some, the assembly’s process to consider divestment in companies that do not produce substantial change is too slow and the consequences are too great. In this case, the criteria for engagement with fossil fuel companies was approved at the 222nd General Assembly in 2016 and the resulting action on targeted divestment was taken three assemblies later.
This year, the General Assembly 226 Environmental and Climate Justice Committee will consider an overture (ENV-02) that recommends adding any publicly traded companies “whose primary source of income is derived from the exploration, development and production of fossil fuels are to be placed on the General Assembly’s list of prohibited securities.”
This year, the General Assembly 226 Environmental and Climate Justice Committee will consider an overture (ENV-02) that recommends adding any publicly traded companies “whose primary source of income is derived from the exploration, development and production of fossil fuels are to be placed on the General Assembly’s list of prohibited securities.”
In addition to categorical divestment from fossil fuel companies, the overture recommends all entities of and individuals in the PC(USA) “align their investment decisions with this declaration with all due speed and diligence,” and seek investment in renewable energy enterprises. It also requests reports from PC(USA) investing agencies on their alignment with this overture and calls upon the U.S. government to end subsidies that aid the development or production of fossil fuels.
“The overture (ENV-02) is lifting up a moral statement and saying enough is enough,” says Bruce Gillette, moderator of Presbyterians for Earth Care. “Martin Luther King Jr. talked about the paralysis of analysis, and I’m grateful for what MRTI has done. But the process in which they are doing it, given the timeline that we have and the urgency, we need to move more quickly … Again, listen to the scientists. Listen to the news reports. It’s not enough.”
For their part, MRTI has answered the call for categorial divestment from fossil fuels with their own overture (ENV-06) which, calling upon the divestment guidelines established in 1984, advocates prioritizing their actions to address the “existential threats of the climate crisis” alongside other investors as part of the Climate Action 100+ initiative. The overture also recommends focused engagement with companies Ameren and EOG Resources on climate issues.
“We are seeing some movement from the companies on our current engagement list and we don’t see a need to recommend divestment at this time,” says Katie Carter, MRTI’s director of faith-based investing and shareholder engagement. “We’re continuing to see a divergence of oil and gas companies, some that are working towards compliance with the Paris Agreement and others are not.
“ENV-02 is seeking to make a pretty sweeping policy statement this year, saying that holding any shares in oil and gas companies is anathema to Presbyterian values. And the MRTI’s position is that if the General Assembly agrees with that, MRTI believes it would need to come from the Advisory Committee on Social Witness policy to make that significant of a policy statement.”
“ENV-02 is seeking to make a pretty sweeping policy statement this year, saying that holding any shares in oil and gas companies is anathema to Presbyterian values. … MRTI believes [this policy statement] need(s) to come from the Advisory Committee on Social Witness policy.” — Katie Carter, MRTI’s director of faith-based investing and shareholder engagement
Institutional investments
While ENV-02 encourages all entities and individuals affiliated with the PC(USA) – congregations, presbyteries, synods, educational institutions and members – to divest from fossil fuel companies, it specifically names the two largest institutional investors of the church for action and reporting.
Holding investments worth more than a combined $13 billion, the Board of Pensions (at $10.5 billion) and Presbyterian Foundation (at $2.5 billion), these groups are being asked to lead the way in making these changes. While some see these agencies as reluctant to be ahead of the curve on clean energy investment, each says their investments are in line with General Assembly and MRTI directives, going beyond what is asked in some areas.
“We have a deep commitment to move toward clean energy and a cleaner planet,” says Tom Taylor, president and CEO of the Presbyterian Foundation. “Beyond the recommendations of MRTI, and within the bounds of legal responsibility intentionally set up to give us guidance, we run the prohibited securities list through software that gives us even a broader group of companies we elect not to invest in.”
Using the results of this assessment, Taylor says the investment committee and board of the Foundation have not failed in working toward more sustainable investments, including an annual commitment to moving at least 1% of all investments into clean energy.
And these socially responsible investments (SRIs) have proven to be good investments. A recent report in Research in International Business and Finance concludes SRIs are on par with or outperform major investment indexes slightly in the U.S., while significantly outperforming the market in European and Asian-Pacific developed markets, along with better portfolio performance in emerging markets.
For its part, the Board of Pensions says it has worked toward a positive investment strategy including allocating $160 million to the Impax Leaders Strategy fossil-free fund and up to $200 million of retirement savings plan elections in clean energy funds for individuals since 2017.
“We have never failed to accommodate a divestment request from the General Assembly,” says Frank Spencer, president of the Board of Pensions. “We support the process of MRTI and have built our [investment] policy based on their advice.”
Still, Gillette of Presbyterian for Earth Care believes the denomination should be held to higher standard.
“What we are trying to do is lift up a moral statement about the urgent need for change” — Bruce Gillette, moderator of Presbyterians for Earth Care, on ENV-02
“If you look at this overture (ENV-02), nothing is binding on anybody,” he says. “We understand the polity and we also understand God alone is the lord of the conscience. But what we are trying to do is lift up a moral statement about the urgent need for change. We need not only as individuals but as a denomination to move beyond fossil fuels, and an important part of this overture is not just taking money out but encouraging more green investments.”
Other committee business
Additional related overtures coming to the committee include the recommendation to adopt a “Sustainable Peace Pledge” (ENV-01) in which the denomination, its entities and individual members are encouraged to develop a long-term strategy to mitigate the effect of climate change.
(ENV-03) encourages quick action on “Becoming Free from Plastic Pollution,” and motivates the church toward a sustainable culture, in part by reducing the use of single use plastics and packaging. It also encourages MRTI to engage with companies to reduce the production and use of plastics, a possible overlap with ENV-02, as many petroleum manufacturers also supply the materials needed for plastics production.
In response to a referral by GA 225 in 2022, ENV-04 is a recommendation by the Advisory Committee on Social Witness Policy (ACSWP) to approve a study on the impact of lithium mining, with particular attention to activities on Indigenous lands and communities in South America and the Western United States. It encourages the transition to green-energy solutions while recognizing the environmental impact of lithium mining and asks MRTI to engage companies to ensure the lithium mining activities in which the church is invested utilize free, prior and informed consent where Indigenous communities are impacted.
“I want us to be a church that focuses on environmental sustainability. I want us to be part of the solution. But there is a difference between making a statement and making an impact” — Tom Taylor, president and CEO of the Presbyterian Foundation
The committee will also receive a paper titled Environmental Justice and the Costs of Green Transitions, which recognizes the urgency around addressing global climate change and looks at justice principles in the application of transitioning to green energy sources.
“I’m glad we’re talking about this topic,” says the Presbyterian Foundation’s Taylor. “I want us to be a church that focuses on environmental sustainability. I want us to be part of the solution. But there is a difference between making a statement and making an impact. Both are important, and the bigger the target of our impact, the more it will become a statement beyond the PC(USA).”