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divestment

Divestment is the process of selling off assets or withdrawing investments, typically to remove exposure to a company, industry, or region or to redirect resources to other uses. In finance, divestment refers to the disposal of stocks, bonds, or other holdings; in corporate strategy, it can involve spinning off or selling subsidiaries or business units. It is the opposite of investment and can be voluntary or mandated by policy or governance.

Common motives include ethical, political, or environmental concerns, reputational risk management, legal or regulatory risk, or

Divestment has been used in several contexts. Fossil fuel divestment campaigns urge universities, pension funds, and

Critics argue divestment alone may not reduce emissions or risk if capital simply relocates to other assets;

a
strategic
reallocation
of
capital.
Methods
range
from
screening
or
excluding
certain
securities
to
fully
divesting
from
a
sector;
partial
divestment
can
occur
through
reducing
exposure
or
selling
specific
assets.
Some
institutions
complement
divestment
with
positive
investment
strategies,
such
as
reallocating
funds
to
alternatives.
faith
groups
to
liquidate
holdings
in
oil,
gas,
and
coal
producers;
apartheid-era
divestment
targeted
regimes
with
sanctions.
Governments
and
funds
may
also
divest
from
industries
deemed
controversial
or
unsustainable,
or
spin
off
assets
for
strategic
reasons.
it
can
reduce
liquidity
and
impose
administrative
costs.
Proponents
contend
it
can
change
corporate
behavior
by
altering
funding,
improving
governance,
and
signaling
political
or
social
commitments.