Whether motivated by practical or ideological means, institutions around the world are pulling their finances out of oil, gas, and coal.
Upon receiving the news in 2017 that our planet is in the midst of its sixth mass extinction event, spurred partly by rampant climate change, stunned denizens of Earth everywhere struggled to process the implications and searched for concrete ways to mitigate the damage. In the months since, countless climate proposals have rolled out across the globe, and U.S. citizens have watched as 2020 presidential hopefuls laid out their plans—all while the current president decried the very existence of climate change. In the flurry of rhetoric and policy aimed at addressing the climate crisis, one strategy continues to hold strong: fossil fuel divestment, which has hit the headlines this summer with particular force.
On July 4—Independence Day in the United States—Britain’s largest membership organization declared independence from fossil fuel investments. The National Trust, which stewards 780 miles of coastline; 612,000 acres of land; and more than 500 historic houses, castles, monuments, and parks, announced that it would divest its £1 billion portfolio from fossil fuels in a bid to address the worsening climate crisis.
Previously, the trust had invested £45 million into oil, gas, and mining companies, despite having made earlier pledges to cut down on its own use of fossil fuels. The vast majority of those investments will be withdrawn in the next 12 months, the trust promises, and 100 percent within three years. The freed-up funds will be diverted to alternative energy options: CFO Peter Vermeulen told The Guardian, “Now we will seek to invest in green startup businesses and other suitable portfolios that deliver benefits for the environment, nature and people.”
Five hundred miles away in Norway, another high-profile institution is also preparing to drop fossil fuels: the Government Pension Fund Global (GPFG), which was founded in 1990 to oversee the integration of petroleum revenues into the national economy, and which invests in more than 9,000 companies worldwide, including Apple, Amazon, and Microsoft. On June 21, Norway’s parliament, the Storting, approved plans for the GPFG to divest more than $13 billion of the $1.06 trillion it manages from investments in oil, gas, and coal. The decision comes with some caveats: GPFG will only divest from companies that are exclusively involved with fossil fuels, but not oil companies that also have renewable energy units, such as BP and Royal Dutch Shell. And the fund maintains that financial considerations, not ideological ones, are behind the divestment, given the risk posed by fluctuations in oil prices. Nevertheless, environmental advocates can appreciate the fact that GPFG will earmark up to 2 percent of its funds—or about $20 billion—for investments in renewable energy.
In some cases, not only individual institutions are divesting, but also entire regions. At the beginning of June, the city council of Charlottesville, Va., voted 4-1 to divest the city’s operating budget investments from any entity involved with the production of fossil fuels or weapons. Supporters explain that the divestment—which will be carried out within 30 days of the decision—aligns with the city’s strategic plan goals, including being responsible stewards of natural resources. Charlottesville joins various other college towns across the United States, including Ann Arbor, Mich., and Berkeley, Calif., in pledging to divest.
At some universities, however, the prospect of divestment has long brewed controversy, which is coming to a head in light of the climate crisis. During Al Gore’s speech at Harvard University on May 29, the former vice president turned environmental activist called on his alma mater to divest, stating that climate change is “a threat to the survival of human civilization as we know it” and framing divestment as “a moral issue” for the university. In recent years, student activists at Harvard have ramped up demands on the school to divest, and the student newspaper reversed its formerly opposed position in May, acknowledging that Harvard’s reluctance to entertain the possibility of divestment “compromises its efforts to position itself as an academic institution at the forefront of the fight against climate change.” On the administrative side, more than 300 faculty members have signed a petition calling for divestment of fossil fuel stocks. Nevertheless, this number represents less than 14 percent of all faculty, and the university maintains the opinion that it should impact public policy through research rather than through its endowment.
Across the country, 47 U.S. colleges and universities have chosen to divest, although the number has dropped off in recent years, with only 10 making the decision since 2017. Most recently, the Board of Trustees at the University of North Carolina, Asheville, voted on June 21 to divest a portion of their $50 million endowment from fossil fuels. The unanimous vote, which will make the Asheville campus the first in the UNC system to divest, builds on a resolution spearheaded by student activists. In concert with administration and the Board, these activists researched new funds in which the university could invest about 10 percent of its capital, eventually landing on Walden Asset Management, which focuses on investing using environmental, social, and governance criteria.
Meanwhile, earlier this month, the University of California—another sprawling and well-regarded state university system—saw 77 percent of its voting faculty agree “to divest the university’s endowment portfolio of all investments in the 200 publicly-traded fossil fuel companies with the largest carbon reserves.” The decision is now in the hands of the University Regents. Should the Regents choose to divest, the news would make waves on the national level due to U Cal’s significant size and prestige—and in the fight against fossil fuels, ideological statements, even if they have negligible bearing on the industry’s financial resources, are of the utmost importance.
Individuals in academic circles, therefore, are beginning to take their own stands to support divestment. In a piece for the Chronicle of Higher Education, climate activists Christiana Figueres and Bill McKibben explain that they have begun refusing to accept honorary degrees from colleges that have not divested, writing, “[e]ach of us has already turned down these honors at institutions that remain committed to coal, gas, and oil.” Meanwhile, members of the younger generation are also weighing in—such as Jamie Margolin, a rising high school senior and prominent environmental activist with more than 11,000 Twitter followers. In a piece for Teen Vogue last month, Margolin wrote, “I have serious concerns about how my future school might be investing in fossil fuels and, if they can’t be convinced to divest by student activists like me, how that might render my college education useless.” From Norway to Britain to Asheville to Cambridge, from Ivy-educated vice presidents to those still awaiting their high school degrees, the world is beginning to agree that taking action is not optional.
TALYA PHELPS hails from the wilds of upstate New York, but dreams of exploring the globe. As former editor-in-chief at the student newspaper of her alma mater, Vassar College, and the daughter of a journalist, she hopes to follow her passion for writing and editing for many years to come. Contact her if you're looking for a spirited debate on the merits of the em dash vs. the hyphen.