The finance perspective on fossil fuel divestment

Auke Plantinga*, Bert Scholtens

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

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This paper reviews the fossil fuel divestment literature. It argues that the origin of climate change is in the ‘carbon shield’, meaning that fossil fuel firms are not held sufficiently responsible for their externalities. By divesting from these firms, investors do not want to be complicit. The literature differentiates three dimensions in the fossil fuel divestment debate: Justification, Impact, and Agent. The first discusses the justification for divesting, whereas the second discusses the impact of divesting on financial performance and/or emissions, and the third relates to how to accomplish divesting and its consequences for individual agents. The review concludes that the number of perspectives used to analyze the divestment debate is rising, that the environmental and financial impact of divestment is very limited, and that a wide variety of agents relate to divesting from fossil fuel.

Original languageEnglish
Article number101394
Number of pages5
JournalCurrent Opinion in Environmental Sustainability
Early online date21 Dec 2023
Publication statusPublished - 1 Feb 2024


  • Fossil fuel
  • Divestment
  • Review
  • Carbon shield


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