Forty Catholic institutions from around the world announced on Tuesday, the anniversary of the death of St Francis of Assisi, that they were avoiding investments in fossil fuels.

The move represents the largest ever faith-based divestment from fossil fuels and follows a similar move by nine institutions in May. Not all of those taking part have many investment to sell, if any, but are seeking to prevent future investments and to inspire others to follow suit.

Among the 40 are Assisi's Sacro Convento, the Catholic archdiocese of Cape Town, Germany's Bank fur Kirche und Caritas eG, Oikocredit Belgium, the Australian Jesuit Province, Newman University in England and the US Center for Action and Contemplation.

The Global Catholic Climate Movement told Reuters: 'joint divestment from fossil fuels is based on both their shared value of environmental protection and the financial wisdom of preparing for a carbon-neutral economy'

The Assisi municipality also allied itself with the 40 institutions, shedding all of its oil, coal and gas holdings the day before a visit by the Italian prime minister, Paolo Gentiloni, to mark St Francis's feast day.

Assisi's mayor, Stefania Proietti, a specialist in climate change mitigation, told the Guardian: 'When we pay attention to the environment, we pay attention to poor people, who are the first victims of climate change.

'When we invest in fossil fuels, we stray very far from social justice. But when we disinvest and invest in renewable and energy efficiency instead, we can mitigate climate change, create a sustainable new economic deal and, most importantly, help the poor.'

She said the town was committed to investing in cleaner energy, including solar panels and electric vehicles.

The decision to divest from fossil fuels has been inspired by Pope Francis' climate encyclical released last year in which the Pope credited St Francis, his namesake, known for his love of nature.

Ben Caldecott, founding director of the Oxford Sustainable Finance Programme at the University of Oxford, told Reuters: 'Groups with moral authority, religious groups being a good example, are likely to have a disproportionate impact in terms of increasing stigma' of investing in fossil fuels.'