Fossil Fuels in Vatican Ethical Investment Guidelines, in the light of the “Economy of Francesco” event


We are leading economists worried about the catastrophic consequences of the climate crisis, who are pleased to write this letter with the warm suggestion to introduce in the document the idea of accelerating the dismissal of investment in fossil fuels (as the same energy companies are planning to do), as suggested by the same Laudato Si (n. 165) and following the benchmark practice of some of the most important International investment institutions (the European Investment Bank has declared it will stop financing investment in fossil fuels since 2021)

We were glad to hear about your public remarks on the new guidelines that are being drafted and we hope they are truly prophetic, in line with the spirit of the “Economy of Francesco” convening that several of us will attend. This would also be in line with the outcome document of the Amazon Synod which endorsed divestment as a strategy to address the destruction by extractive and fossil fuel industries. But most importantly, it would be in line with Pope Francis’ clear statements on the need to urgently phase out fossil fuels, both in the Laudato Si’ Encyclical and in statements such as the one of June 2018: “Yet even more worrying is the continued search for new fossil fuel reserves, whereas the Paris Agreement clearly urged keeping most fossil fuels underground. Civilization requires energy, but energy use must not destroy civilization!”

As economists we fully agree with Pope Francis’s statement, and that means that we all need to divest from the fossil fuel industry. As 11.000 from 153 nations warned recently, we face a dramatic “climate emergency” and in order have a chance of being in line with the Paris Agreement and keeping global temperature rise within a 2°C limit, around 80% of known fossil fuel reserves need to remain in the ground. This means that between two-thirds and four-fifths of the reserves of coal, gas, and oil cannot be used, rendering them worthless. And the numbers are even stronger if we are to achieve the most ambitious goal of 1.5°C of the Paris Agreement, which is what scientists urged us to do in the IPCC report. The over-valuation of these reserves, that are “stranded assets”, can lead the world into an economic and financial crisis. Ten years ago all we have seen and experienced the consequences of a global financial crisis, and we cannot let this happen again. To accelerate a just transition that is already in progress, we can no longer invest in coal, gas and oil companies. 

As we prepare for the Economy of Francesco event, we think it would be remarkable if the new investment guidelines would include criteria for the dismissal of investments in fossil fuels. We trust that such exclusion will be positively welcomed and valued by the young people, economists and change-makers who will go to Assisi to meet Pope Francis.

With humility, we hope that you may consider our request and we thank you for your leadership to advocate for our common home.

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