Southwark Council has announced it will divest its pension fund from fossil fuels.
The decision will make the £1.2 billion fund the largest local government pension scheme to move away from coal, oil and gas.
Councillor and Chair of the pension fund Fiona Colley suggested divestment will be steady and gradual, with the council also exploring the potential of clean energy investments.
She said: “The commitment to cut pension investment in fossil fuels long term is a measured and carefully considered decision, based not only on ethical practice and the council’s continued drive to reduce exposure to fossil fuel but also on reducing the financial risk of investing in traditional energy sources, which will ultimately become obsolete.”
The move follows a two-year campaign by local residents, pension fund members and council employees called Fossil Free Southwark.
A cross-party group of MPs have also been calling for the Parliamentary Pension Fund to be divested from fossil fuels.
The assets of global individuals and institutions pledging to divest from fossil fuels are now worth nearly $5.2 trillion (£4.09tn).