Abolition as an Historical Example for ESG Investing

Often as I think about the inherent strength and effectiveness of Environmental, Social and Governance (ESG) Investing and Socially Responsible Investing (SRI) I end up thinking about historical examples of social movements that have effectively used economic power to influence wider social policy. These efforts to improve society and the economy for all of us end up pressing against established interests that need to be convinced to change with the times.

And as I look for these historical examples, one of the earliest that comes to mind was the movement to abolish the slave trade. A campaign that Canada played a proud early role in promoting.

Abolition: A brief history that starts with a personal, Canadian touch

I have a personal, present-day connection to the abolition movement of the 18th & 19th century. A couple of years ago, I signed a petition calling for a street near my home in Toronto to be renamed.

Dundas Street is named after Henry Dundas, First Viscount Melville, who played a major role in delaying the abolition of slavery in Great Britain and the British Empire in the late 18th century.

But in August of this year three former mayors that I greatly admire published a letter they had sent to the new mayor, Olivia Chow. Art Eggleton, David Crombie and John Sewell argued that that Dundas was a “committed abolitionist” who amended a parliamentary resolution in the late 18th century to call for the gradual abolition instead of its immediate abolition. The CBC cites two clips form the letter: “In their letter, the former mayors suggest Dundas was ‘doing the best he could”’ under ‘challenging historical circumstances.’

The Dundas name can be found all over Ontario, in the naming of major streets, public squares, towns and even counties.

This was because of his friendship with John Graves Simcoe, lieutenant governor of Upper Canada from 1791-1796.

Simcoe himself was actually an abolitionist before arriving in Upper Canada and was able to oversee passage of the Act Against Slavery at the first meeting of the Executive Council of Upper Canada in 1793.

When I first investigate this story, I wasn’t sure how conversations between Dundas and Simcoe over a pint of bitters handled that type of a disagreement. Now, if the former mayors are correct, it makes a bit more sense. I guess we’ll never really know.

But what I do know is that Upper Canada took a lead role in pressing forward with abolition here in British North America. And considering our proximity to the newly independent United States, that’s significant.

Abolitionist Efforts in Mother England

While the Executive Council of Upper Canada acted in 1793, it took until 1807 for the British Parliament to vote to abolish the slave trade – the capture and transfer of African slaves to regions in the “new world”, the United States and the Caribbean. And it would take another 25 years for them to actually abolish slavery.

The campaign in Great Britain to abolish the slave trade began with the establishment of the Society for the Abolition of the Slave Trade in 1787. Amongst its many organizing efforts were petition campaigns and boycotts of produce created by slave labor – especially West Indian Sugar, produced on slave plantations.

One element of the Sugar Boycott was the effort to point out to shoppers that sugar was available from plantations in Malaysia, that were not produced using slave labor. Similar to the emphasis in climate change education to point to renewable options to fossil fuels.

These abolitionist campaigns were important for:

  • educating the public about the existence and reality of slavery
  • demonstrating support for the abolition of slavery in the wider community and
  • focusing the attention of public officials on efforts to achieve abolition

These campaigns went on for years, as abolitionists fought to eliminate slavery in all its capacities.

But like so many other publicly popular campaigns (women’s suffrage, worker’s rights, abortion rights, the anti-apartheid movement to name just a few) the campaign needed decades to convince the British Parliament to finally abolish the slave trade. In fact, slavery itself was not abolished in the British Empire until 1833-34.

US Abolitionists Use Economic Pressure Too

Slavery would continue in the United States until Abraham Lincoln signed the Emancipation Proclamation in 1862, at the height of the American Civil War.

A great deal of the abolitionist efforts in the United states prior to the Civil War also took the form of refusing to use products produced with slave labor. In the United States this included cotton and tobacco.

Economic Aspects of the British Abolitionist Campaign

One element of the century-long abolitionist campaigns was the use of economic pressure – boycotts. The most famous of these was the British Sugar Boycott. But it was not the only product that abolitionists identified with the slave trade.

These campaigns were repeated numerous times over the forty years it took for the Committee to Abolish Slavery to fully accomplish its aims.

From the onset the Campaign to Abolish Slavery concentrated much of its efforts on public education and participation. These economic campaigns succeeded by bringing attention to the evils of the slave trade and suggesting ways for people to get involved in their daily lives.

Interestingly, while the Sugar Boycott was a very successful part of the ongoing campaign, the term itself was not actually coined until the 1880s – in “honor” of Charles Cunningham Boycott, a British estate manager in Ireland.

Sustained by Lobbyists – Not by Economic or Social Relevance

As the Campaign to Abolish Slavery got started, historical conditions had begun to make continuation of the slave uneconomic, as well as unethical. The development of modern industry highlighted the inefficiencies of the plantation system that needed slaves to survive.

These economic developments and modernizations gave added impetus to ethical, moral and spiritual efforts. Although plantations became less economically viable for society as a whole, those who personally benefitted from their continuation had a significant interest in maintaining them.

Dundas played a significant part in propping up the interests of those in the slave trade. And it served his personal interests as well. In fact, Dundas is the last British MP to have been impeached for financial improprieties. Not an especially wholesome character to idolize.

And now today’s lobbyists for the fossil fuel industry are playing a similar role. Maintaining an industry that society has outgrown. Modern advancements make renewable energy a more cost-effective way of producing the energy we need.

Activists and commentators point to this fact – that fossil fuels are becoming less economically viable, as well as environmentally damaging. This is all because renewable energy is becoming increasingly more cost effective and has been for years.

The only way to maintain both coal and gas as energy sources in the long run is through subsidies – such as environmentalists have been accusing them of receiving for years.

As subsidies become less acceptable and the fossil fuel industry becomes less viable, ESG investors are able to champion new opportunities that economically and environmentally more effective.

Abolitionists Then – ESG Investors Now

This is where I see the historical overlap with today’s emphasis on ESG. ESG seeks to look at outmoded economic models in a socially relevant light.  This is especially true of efforts to highlight environmental aspects of ESG – the first part of environmental, social and governmental investing.

Transition is Essential

In Upper Canada, Lord Simcoe was able to introduce legislation that effectively abolished slavery, just not right away. His compromise was to ban the further importation of slaves into Upper Canada and to ensure that children born to enslaved women were not going to become slaves themselves.

Efforts in Britain ended up taking the same gradualist route, chipping away at the slave trade and its role in the world. The American Civil War is the example of abrupt change that brought an effective end to slavery around the world.

Climate change initiatives also center around the struggle to shift from one economic/environmental model to another. Current efforts around the world demonstrate that, including President Biden’s infrastructure plans and the carbon tax fight here in Canada.

When we look back on the abolitionist movement of the late 19th century it’s hard to think that anyone could have ever supported the continuation of the slave trade. I hope when others look back on early 21st century society, that they will be equally confused by lingering efforts to maintain the fossil fuel industry.

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