Episcopal City Mission divests endowment from fossil fuels

Episcopal City Mission (ECM) has voted to divest its $16-million endowment from exposure to fossil fuels. The unanimous vote of the ECM Board of Directors took place at its May 8 meeting after months of research, reflection and deliberation that included thorough analysis of the potential financial impact of divestment. According to ECM's announcement, the Finances Committee and the Board of Directors were satisfied that ECM’s portfolio manager has designed an investment strategy with comparable returns so that fiduciary responsibilities for the endowment can be exercised without investment in fossil fuels. 

“It is my hope that ECM’s actions here will encourage other Episcopal organizations, including our own diocese’s Trustees of Donations and other investors, to take a hard look at their portfolios and whether they are in line with their faith commitments, including social justice and caring for creation,” said the Rev. Noah H. Evans, chair of the board of Episcopal City Mission, in ECM's announcement of the divestment. 

Dr. Ruy Costa, Executive Director of ECM, referenced the latest National Climate Assessment report, which demonstrated that the effects of climate change are already a present reality. 

“How can a Christian organization not respond to this?” he said. “We feel we are accountable for how we manage our money, and if our money is growing in investments that are harmful to nature and to people, that needs to be corrected.” 

The action of the ECM Board comes in part in response to a resolution on environmentally responsible investing that was passed by the 2013 Diocesan Convention.  The resolution calls for a freezing of direct investments in the Carbon Tracker top 200 fossil fuel companies; its asks that the Trustees of the Diocese, congregations and other affiliated institutions research and identify “best in class” fossil fuel companies, and that assets of the Diocesan Investment Trust only include “best in class” fossil fuel companies after November 2013. The resolution also calls for the design of “an alternative investment vehicle that is free from fossil fuel production companies.” (The original resolution can be found in the "Actions" document on the 2013 Convention page.) 

Previously, ECM had some investments in fossil fuels, which were limited to “best in class” companies. (“Best in class” fossil fuel companies are comparatively more responsible, and may support efforts that mitigate some of the effects of fossil fuel consumption).  After the November 2013 Diocesan Convention, ECM began to work with its portfolio manager to explore the possibility of divesting entirely from fossil fuels.  The new portfolio plan was adopted on May 8. 

Costa said that ECM’s investment management firm has a five-year track record of managing portfolios with either limited fossil fuels or no fossil fuels. Costa said that investment management firm’s reports show that the fossil-fuel free and “best in class” fossil fuel strategies perform comparably to portfolios that contain fossil fuels. 

Costa quoted the teachings of the apostle Paul in his letter to the Christians in Rome that “creation awaits with eager expectation the revelation of the children of God.” 

“I hope that what is manifested in our work and through our investments is a theology of caring: caring for our neighbors, caring for the future and caring for nature,” Costa said.