New research from ActionAid Ireland and Trócaire has revealed that as of June 2024, Irish-based subsidiaries of investment companies held €31.76 billion ($34 billion) in fossil fuel investments.
The two groups’ The Hidden Truth report claims that Ireland ranks 14th globally in terms of fossil fuel investment by manager location, as well as being one of just two countries – as well as Switzerland – to have significant fossil fuel investments without having a major fossil fuel industry of its own.
‘Incredibly profitable’
Noting that the fossil fuel sector ‘remains incredibly profitable’ for businesses sectors, ActionAid Ireland and Trócaire pointed to Ireland’s foreign direct investment model as an enabler of these investments, and called for greater regulation and tax reform to nudge investors towards more sustainable business practices.
‘Fossil fuel investment is too profitable to remain weakly regulated,’ they noted. ‘If Ireland continues with its current strategy of encouraging FDI at all costs, and relying on weak EU regulation, we are headed for catastrophe.’
Policy recommendations
In their report, the two groups also make a number of recommendations for Ireland, to enable the country to wean itself away from fossil fuel investment – firstly, the introduction of a strong due diligence framework that includes the regulation of investors with respect to human rights and the environment and climate.
They call on Ireland to endorse developing a Fossil Fuel Non-Proliferation Treaty to curb fossil fuel expansion, as well as support new tax rules under the under the UN Convention on Tax, conduct a fresh spillover analysis of Irish tax policy, and implement equitable taxes to finance climate action.
Finally, the groups urge Ireland to meet its climate obligations under the Paris Agreement, support debt cancellation and move sovereign debt negotiations to a fair, representative UN framework.
‘Given the urgency and scale of the climate crisis, Ireland needs as a matter of urgency to make different, better policy choices,’ the report notes. ‘As the Programme for Government for Ireland warns, “Time is of the essence as global warning continues’ and Ireland needs to take ‘decisive action to radically reduce our reliance on fossil fuels”.’ Read more here.
