Since Pope Francis’s influential 2015 encyclical on environmental stewardship, urging a departure from fossil fuels to combat climate change, hundreds of Catholic institutions worldwide have committed to divesting from oil, gas, and coal. However, despite this global trend, U.S. dioceses remain resolute in retaining their investments in fossil fuel assets.
According to a Reuters review of financial statements, U.S. dioceses continue to hold substantial stocks in fossil fuel companies, using these portfolios to fund church operations and clergy salaries. Some are also involved in leasing land to drilling companies, indicating a significant financial stake in the fossil fuel industry.
The U.S. Conference of Catholic Bishops (USCCB) updated its guidance on socially responsible investing in 2021, acknowledging the pope’s encyclical but clarifying that it does not mandate divestment from fossil fuels.
“Pope Francis continues to make appeals. This is a call and a plea for fidelity,” expressed Dan DiLeo of Creighton University, emphasising the ongoing efforts to align with the pope’s message.
However, this contrasts with the Vatican’s stance, with APSA, the department managing the Vatican’s portfolio, refraining from investing in fossil fuels. The Vatican Bank also adheres to this policy, abstaining from fossil fuel investments.
Globally, over 354 Catholic institutions across 50 countries have divested from fossil fuels, yet no U.S. diocese has followed suit. Financial reports of several U.S. dioceses reveal holdings in energy stock and bonds without specifying underlying companies, while others engage in oil and gas leasing.
The USCCB’s investment guidance encourages consideration of divestment from companies failing to align with the Paris Agreement goals. However, this guidance falls short of requiring complete divestment from fossil fuels.
The Christian Brothers Investment Service (CBIS), managing investments for Catholic entities, advocates for active shareholder engagement rather than wholesale divestment, including holdings in major oil and gas companies.
Critics argue that the U.S. Catholic hierarchy’s resistance to divestment aligns with conservative leanings, leading to reluctance to address climate change urgency.