Daventry council criticised for £7.5m deposits with Abu Dhabi bank amid calls to stop investing in fossil fuel supporters

Daventry District Council was quizzed why it had made a £7.5m deposit with the First Bank of Abu Dhabi after stating it would stop investments in banks linked to fossil fuels.

The district council declared a climate emergency in February 2020 with a change in policy by members to cut carbon emission.

It included a pledge that "no new investment should be made in banks" with links to "extraction, processing or distribution of fossil fuel".However, two months later in April that year, the council invested £5.5m of its portfolio with the First Bank of Abu Dhabi, which has ties to crude oil production. This included the creation of the 'climate change emergency task panel' in 2019, which called for the council to do more to cut greenhouse gases and stated: "Global warming is perhaps the most serious threat we are facing."

An additional £2m was deposited with the bank in January 2020.At an extraordinary meeting on February 18, a member of the public, Chris Riches, asked council to explain the investment.

Mr Riches asked: "Would the leader [Richard Auger] please explain how a £7.5m deposit in the First Abu Dhabi Bank aligns with the objectives of his council?"

Mr Auger's replied: "Where an investment with specific green credentials is available and appropriate that will be selected in preference over the otherwise comparable investment."

Mr Riches has criticised Councillor Auger response, claiming he did not address 'a single point'.

It comes at the same time a report by The Guardian claimed nearly £10bn of pension and portfolio investments are being held in fossil fuels despite many of them declaring a 'climate emergency'.

The £7.5m investments with the First Bank of Abu Dhabi made up 11 per cent of DDC's portfolio investments worth £64.5m between March 2018 and August 2020, detailed in treasury management state in November 2020.