Parents: your pensions are screwing up your children's future

When pension funds and investment managers are opposed to governments, they can be ruthless. These otherwise behind the scenes organisations played a big role in killing the EU's Robin Hood Tax (also known as the Financial Transaction Tax), claiming that it would harm their members.Now we want to harness this power for a much bigger goal – to help ensure we don't sleepwalk into climate catastrophe. It truly is, as the US secretary of state John Kerry has just called it, a "weapon of mass destruction".

That wouldn't be good for pension returns – as Anne Simpson, a senior official at one of the world's biggest pension funds says: "There will be no place for CalPERS to invest in a 4 degree climate warming world." And it won't be very good for us, young people, either. Who wants to live in that kind of dystopian world?

Protests can do a lot to raise awareness, but they lack a very important ingredient: Money. This is why the environmental movement turned to investors as a powerful lever of change. The fossil fuel divestment campaign with its focus on "easy" targets, such as universities and charitable organisations, has given a big boost to climate change activism. These institutions can give a powerful message. But their financial power is dwarfed compared to the trillion pounds average citizens jointly own in their pensions.

Pension funds are cruising along, unsuspecting of the large iceberg coming their way. The companies they own spend our parents' retirement savings in the search for new fossil fuels – at a time when existing reserves are already sufficient to lock us into potentially 5°C of global warming. What's worse, they also seek to manipulate public opinion and lobby governments, ensuring nothing stands in the way of profits.

Meanwhile, few global leaders are displaying the courage to address the issue of climate change. The blunt reality is that it's the older generation who largely ignored scientists' warnings, and many of them are still in denial about climate change. It is their culture of irresponsibility that created this mess, and their generation is over-represented among the political and business decision-makers. Yet it's we– the younger generation – who are going to suffer the consequences of their passivity. It is down to us to make our voice heard and to find a way around our lack of representation.

Most young people have no funds, but our parents collectively have a very large pot of money in their pensions. Whether they are concerned about climate change or not, they do really care about their children. If asked directly, what parent would want their money to fuel an economy which harms their children's prospects for the possibility of a little extra performance in the short term? And who is better suited to ask them to have their say on this trade off than us, their own children?

This is the thinking behind the Push Your Parents campaign: young people's future is at stake, so we encourage them to ask their parents to take two minutes to email their pension funds. Parents can find an emailing tool and a letter template online asking pension funds to act on climate change risks for their investments.

Alongside our own research on investment and pension funds, we received help from Share Action, the Asset Owners Disclosure Project and the experts on our advisory council. As it turns out, investing is not as complicated as it sounds, and with a fresh eye, you can actually notice inconsistencies that the experts have just learnt to ignore.

Pension funds engage in short-term trading, or "beauty contest" investing as Keynes called it. This is harmful to long-term returns and clearly ignores the fact that pension members often have investment horizons of decades. If the financial system carries on with business as usual, atmospheric carbon concentrations will rise alarmingly with the real risk that pension assets will be wiped out along with the world as we know it.

Because of their long-term horizon, pension funds can and should be the drivers of the transition to the low carbon economy. Pioneers include the Norwegian fund Store brand, which recently divested from 29 coal and oil sands companies, taking a strong engagement position on the climate change issue.

Many funds are also requesting fossil fuel companies to assess and report on their carbon assets risk. Yet these are exceptions. Public pressure is needed for pension funds to become the active owners of companies they ought to be. The laggards need to be cajoled, and the leaders rewarded. The good news is pension funds are accountable to pension members. If you or your parents have a pension, the power is in your hands. Please demand that your fund stops fucking up our future!



This article was originally posted online at the Guardian's website and reposted here. As an owner of this blog I do not claim any right on this article and I am grateful to the Guardian and the authors who are: Antoine Thalmann is a masters student in economics at Oxford University and co-founder and member of the coordinating team of the Push Your Parents campaign. Maria is a PhD Student in Biomedical Engineering at the Oxford University. She is in charge of social media and communication for the Push Your Parents campaign.