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On 12 July, Ireland鈥檚 parliament voted for a bill that requires the country鈥檚 鈧�8 billion investment fund to sell off all coal, oil and gas investments over the next five years. The bill has to be reviewed by a financial committee but is likely to become law soon.

Norway announced in 2015 that its massive fund, then worth around $900 billion, would divest billions from coal. Ireland is set to become the first country to divest from all fossil fuels. The news has been greeted with joy by climate change campaigners.

鈥淚reland鈥檚 decision to divest from fossil fuels staggers me. It鈥檚 one of the landmark moments in what has become the largest campaign of its kind in history. Such thanks to all who fought,鈥� of 350.org, one of the first organisations to campaign for divestment from fossils.

Will it actually make a difference in the battle to limit global warming? Naysayers argue that if universities, pension funds and countries sell off their fossil fuel investments, these stocks will just be snapped up cheaply by other investors with no effect on the companies concerned. Divestment just makes less ethical investors richer, they claim.

Bad investment

But that is not what happened to those who invested in coal in recent years. Instead, the world鈥檚 biggest private coal company, Peabody Energy Holdings, went bust. The sector would be in even worse shape were it not for US president Donald Trump鈥檚 efforts to prop up coal. Earlier this year a study found that, in Canada at least, .

What鈥檚 more, financial authorities say there is a serious risk of the value of oil and gas companies collapsing in the future, leading to a global financial crash. So it is prudent for everyone to ensure their wealth does not rely heavily on fossil fuels.

And while there is no evidence that the divestment campaign has directly affected fossil fuel companies, it might yet do so 鈥� say the companies themselves. 鈥淪ome groups are pressuring certain investors to divest their investments in fossil fuel companies,鈥� says energy firm Shell鈥檚 . 鈥淚f this were to continue, it could have a material adverse effect on the price of our securities and our ability to access equity capital markets.鈥�

Then there is the symbolic importance of divestment. It sends out the signal that business as usual is no longer acceptable, encourages investors to look at alternatives and governments to do that bit more to tackle climate change.

But perhaps the strongest argument for divestment is the simple ethical one. Climate change is already destroying the lives and livelihoods of people around the world. 鈥樷�楶eople of conscience need to break their ties with corporations financing the injustice of climate change,鈥� .

That said, divestment is just one tiny part of a wide range of measures required if we are to have any hope of stopping global temperatures soaring to 3掳C or more. Most urgently, just about everyone agrees that countries need to introduce an effective form of carbon pricing.

Unfortunately, Ireland is not doing all these other things too. In fact, its record on tackling climate change is utterly abysmal 鈥� . It needs to do far more.