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Prize Winners Today: Heffa Schücking Holds Banks Accountable for their Role in Climate Change

January 19, 2022

Our interview started with good news: Heffa Schücking (Germany, 1994) was celebrating the birth of her first grandson. When asked about the recent United Nations COP26 conference, the new grandmother laughed, saying, “I was rather afraid you’d ask this. I’ve been spending the days admiring my grandchild and changing diapers!” It was the first time Heffa had missed the global climate conference since 2011, but her keen eye had already homed in on key components related to her particular focus: the role of finance in driving climate change.

Direct, detailed, and friendly, Heffa is the executive director of Urgewald, a German nonprofit with a razor-like focus on finance and its role in supporting fossil fuels. The name Urgewald is a play on words—a combination of the German words for “primary forest” and “primary force.” “It’s very memorable in Germany,” Heffa noted. “We are effectively ‘nature’s force.’”

But the real force of nature is Heffa, who has built the organization from the ground up to its current role as a globally recognized player in exposing coal financing. Since winning the Goldman Prize in 1994, Heffa has maintained a laser focus on protecting our planet.

The Makings of an Activist

Born in Hamburg, Germany, Heffa spent most of her childhood in the United States. In Texas in the late-1960s, her perspective on the Vietnam War set her apart from her classmates. “In Germany,” Heffa observed with acute irony, “we have a very different relationship with patriotism than in the U.S.” The experiences of her father, who deserted from the German army during World War II, and her mother, who fled Estonia as a refugee, had imprinted upon Heffa the idea that “wars were very bad things and do enormous damage.”

Heffa credits her childhood experiences with inspiring her lifelong interest in politics and activism, a passion that would take flight as a college student back in Germany. In the late-1980s, the destruction of tropical forests was widely covered in German media. Heffa began writing to NGOs, asking what she could do to help. The response? Stop those paying for it.

Heffa had found her niche, discovering very quickly that German companies, financial institutions, and multilateral institutions of which Germany was a part (like the World Bank) were subsidizing environmentally destructive projects around the world. She got to work.

Finding a Winning Global Strategy

With a knack for strategy and a drive to master the details, Heffa and her small team began to have an impact. They identified two key strategies: getting in early before a loan agreement is finalized and having a strong media plan with a clear argument.

Heffa reflected on a significant early victory: In 1992, Germany voted in opposition to a World Bank project to build a dam in Thailand. The Pak Mun dam was set to destroy the fisheries of one of Thailand’s largest rivers and was vehemently opposed by local villagers. It was the first time in Germany’s 40-year membership of the World Bank that that the country had voted “no” on a World Bank project. “It was amazing to me what a small group like ours—just three or four people—could achieve,” she recalled. (While the lesson for Heffa and other activists on their potential power was very real, the dam was approved and built in the end, with Germany and the US the outliers in opposing the project.)

For 15 years, Urgewald focused on distinct projects that threatened the environment and public health, such as preventing construction of individual dams, coal mines, or nuclear projects. Then an internal study shifted their focus. Ahead of the 2011 UN Climate Change Conference in Durban, South Africa, Urgewald examined the evolution of coal financing since the 2005 Kyoto Protocol. Their findings left them stunned—in those five years, the funding of coal projects by commercial banks had skyrocketed by 300%.

This explosive growth stopped Urgewald in its tracks. Despite international agreements to reduce carbon emissions, coal subsidies and investments were on the rise. “We realized we were going to lose if we tried to stop each coal mine and coal project on its own. We had to take on the entire industry.”

Developing the Global Coal Exit List

As it turned out, taking on the entire industry was no cake walk. The big banks initially laughed Heffa out of the room. The coal industry was pervasive and deeply intertwined with financial markets and governments around the world. So, Urgewald realigned its strategy, breaking down the systemic fight against coal into a series of steps. Rather than halting coal investments across the board, they campaigned on specific, achievable targets, such as ending investment in new coal power plants.

In 2015, determined to decrease the flow of European investments to coal projects abroad, Heffa began talking to the Government Pension Fund of Norway, the second largest pension fund in the world. Managed by Norges Bank, the central bank of Norway, the pension fund published its vast holdings each year. Known to be a progressive pension fund, Heffa was convinced that its directors would be interested in stepping away from coal investment. However, she was met with blank stares from Norges bank executives. By their calculations, only a paltry €250 million of the fund was invested in the coal industry.

Line by line, Heffa and her team combed through every company in the fund—some 8,000 companies at the time—to build a more accurate estimate of the fund’s true coal investment. “No normal person would do this,” Heffa laughed. “You have to be a little crazy.” Five months of detailed research and analysis later, Urgewald presented its findings: the fund actually had €8 billion invested in coal, 32 times the amount that Norges Bank had reported.

The difference, Heffa discovered, was in the subtleties of language. The bank only counted companies with more than 50% of their revenue derived from thermal coal mining. This excluded coal plant operators, coal traders, coal equipment manufacturers and companies building new coal plants. In Heffa’s reckoning, “Urgewald was looking at the elephant. Norges Bank was looking at one foot.”

This work opened a new chapter for Urgewald as Heffa and her colleagues realized that the global push to divest from coal needed a clear baseline, indicating which companies were investing in coal and how that investment was defined. In 2017 Urgewald published the first Global Coal Exit List, a public database of global companies operating along the Updated annually, the list is now used by over 600 financial institutions and investors—representing US$16 trillion in assets—as a tool for smart divestment. In 2021, Urgewald expanded its research and now also produces a Global Oil and Gas Exit List.

The Future for Climate Change and Finance? 

Heffa is giving financial institutions the tools for wholesale, systemic change. “What really matters is what happens in this decade,” she noted. Commenting on the timelines set forth at COP26, Heffa shook her head: “2050 is far away. Greta [Thunberg] will have grey hair and kids by then!”

During her 30-year career as an anti-coal advocate and climate activist, Heffa has seen plenty of changes in the global climate movement. She noted that positive advances are often chipped away by loopholes in policy, and the rate of progress can be frustratingly slow. “I didn’t realize how much of our work would just be maintenance,” she mused. “You have to fight tooth and nail to maintain certain wins.” At the same time, Heffa is uplifted by the collaborative international network of NGOs and the rise of youth climate activists. “There’s growing interest. More people are realizing that finance can be a very powerful tool.”

Follow Heffa’s work and support Urgewald here.

This blog post is part of the Prize Winners Today series, a monthly installment that reports on the latest news and projects from past recipients of the Goldman Environmental Prize. From reflections on the Prize to updates from the field, we’ll answer the question—what are these extraordinary individuals doing today?

About the author

Ellen Lomonico

Digital Communications Manager

Ellen is excited to elevate the stories and amplify the impact of Goldman Prize recipients around the globe. She manages the Prize’s digital presence, produces written and visual content, and contributes to strategic communications planning. Prior to joining the Prize, Ellen held various roles in the solar industry, from marketing to education program management. She holds a BA in Geography and Environmental Studies, with minors in Spanish and Environmental Systems and Society from the University of California, Los Angeles. She joined the Prize in 2020.

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