23 Sep Are the Rockefellers REALLY going philantropic ?
Whoever knows anything about the Rockefeller family history will without any doubt, and without having to think about it, answer the question above with a “no”. There namely is a difference between naïve and crazy: the Rockefellers are neither, and we surely ain’t crazy. But let us explain what we’re talking about.
The Rockefeller family, more specifically the Rockefeller Brothers Fund, announced yesterday that it turns its back to the oil sector and chooses for “renewable” energy. A bombshell at the eve of the climate conference in New York, knowing that the family has made its fortune thanks to the oil industry, and news that will certainly affect the financial world.
But what will happen concretely ? Well, the Rockefeller Brothers Fund announced that it would pull back 50 billion dollars of investments in the oil industry and invest the same amount in so called “renewable” energy, thus joining the Global Divest-Invest initiative which arose a few years back at American universities.
Undoubtedly good news for the environmentalists, but it doesn’t answer the question whether the Rockefellers really do this for philanthropic reasons. Honestly: the fact that American pension funds, religious groups and big universities have doubled their pledges in Global Divest-Invest since the start of this year proves that either there’s big money there or the stakeholders, members and sponsors of the pension funds, religious groups and big university see no problem in throwing their money away. We put our money on the first possibility.
We dare adding that the Rockefeller statements on their conversion to “renewable” energy sound rather ambiguous: “We are quite convinced that if he [John D. Rockefeller, father of the Rockefeller empire] were alive today, as an astute businessman looking out to the future, he would be moving out of fossil fuels and investing in clean, renewable energy”. We learn from that, in apparent contradiction to the media, especially that the Rockefellers see their decision as one that would be made by an astute businessman. And an astute businessman just goes where the money is.
“Where the money is”, that is these days, or at least in the very near future, no longer in the oil industry, but in the sector of “renewable” energy. To us that’s the reason why the Rockefellers turned “philanthropic” now and not, for example, twenty years ago when the pollution by the oil industry was already more than accurately proven and everybody had come to the conclusion that the oil reserves were not endless. As Ellen Dorsey wrote in The Huffington Post in January divesting from fossil fuels need not adversely affect portfolio risk or performance. Analyses made by, amongst others, Impax, Aperio Group, and Boston Common Asset Management, show not only there’s essentially zero risk in being out of the top 200 fossil fuel companies, but also that to the contrary staying in fossil fuels may present the greater risk, given the existence of the Carbon Bubble and the valuation of fossil energy stock based on stranded fuel reserves.
That the Rockefellers are aware of this problem, is by the way also proven by the fact that the Rockefeller Brothers Fund was one of the sponsors of research on … the Carbon Bubble. So we think that the Rockefellers just go where the money is and that more giants from the oil industry will take the same decision soon. Just like some of the characters in the free prequel to The Maier-Files would …