Dunedin City Council has become the first council in New Zealand to divest itself of fossil fuel investments to highlight their impact on climate change.

The Council voted on Tuesday to remove existing fossil fuel extraction related investments of close to NZ $2 million (US$173 million) and prevent future investments in fossil fuels by its NZ$75 million (US$650 million) Waripori fund. The move sees Dunedin City join 23 US cities and the Dutch town of Boxtel in divesting from fossil fuels, including oil, gas and coal, for ethical and climate change reasons.

These municipalities are part of a burgeoning divestment movement that include global investors, fund managers, religious institutions and academic institutions that are divesting from fossil fuels, buoyed on by climate change campaigning organizations.

‘It’s so fitting that on the day that scientists showed with great clarity the peril of the Antarctic, nearby Dunedin took this huge leadership step. It’s not just the most charming city in New Zealand, it’s the most forward-looking!’ said 350.org co-founder and author, Bill McKibben.

The Dunedin City Council ethical investment policy will formally exclude the following industries from its investment portfolio: munitions, tobacco, fossil fuel extraction, gambling and pornography.

Last week, Stanford University in California announced plans to divest its US$18 billion endowment fund from coal investments. Two weeks earlier, the world’s largest fund manager, BlackRock, outlined its plans to create a fund that will exclude fossil fuels. And last September, five New Zealand based Anglican Dioceses voted to divest.

The divestment movement kicked off in the US in the autumn of 2012. Since then, it has spread to over 500 universities, cities, states and religious institutions across the US, Australia, Canada and Europe, with dozens of institutions already committing to divest. In Europe, campaigns are underway in Britain, the Netherlands, Sweden, Norway, Switzerland and Germany.

Heads of state are set to meet later this year in New York for the Ban Ki Moon Climate Summit. In the meantime, the divestment movement is beginning to gain a momentum that campaigners hope will catalyze urgent global climate action.