In a commentary in the Toronto Star, JD student Graham Henry argues that university endowments should divest themselves of fossil-fuel related investments ("Universities should get out of the fossil fuel business," Feb. 11, 2015). Henry is Treasurer of Toronto350.org, and a campaign lead for Fossil Free UofT.
Read the full commentary on the Toronto Star website, or below.
Universities should get out of the fossil fuel business
By Graham Henry
Feb. 11, 2015
Divesting from the fossil fuel industry is the morally, environmentally and financially right thing for responsible universities to do. Yet when the members of a university community ask (as professors at the University of British Columbia did on Tuesday), quite reasonably, for their endowment to be divested from fossil fuels, a negative nose-bloodying knee jerk will undoubtedly result. Here are some common knee jerks and why they simply don’t stand up to closer examination.
Some critics of divestment will say fossil fuel companies are actually the biggest investors in renewable energy and only responding to public demand when they supply fossil fuels. This is simply not true. Only three of the largest fossil fuel companies spend more than 1 per cent of their annual investments on renewables.
What’s more, in 2012 the industry spent $647 billion seeking new reserves to burn. The only future these companies are bunkering down for is one dependent on burning oil, gas and coal. An industry that spent $213 million in 2013 (in just the U.S. and European Union) lobbying regulators is doing much more than simply meeting the demands of the population; they are actively working to maintain our reliance on fossil fuels. With what we now know about climate change, why should universities support this?
Others will say a university endowment must invest based solely on securing the best financial returns. Ironically, even if this were true, there is little reason to cling desperately to this industry. The fossil fuel age is on the way out. It has to be. Investors are realizing this and fossil fuel stocks are no longer the surefire investments they once were.
In fact, if the University of Toronto had divested from fossil fuels 10 years ago, it would be sitting on a larger endowment today. Looking into the future, with roller coaster oil prices and the evaporating value of high intensity extraction such as tar sands, the optimism of recent years seems like a distant memory.
The idea that a university should only care about financial returns is also wrong both technically and morally. The University of Toronto, for example, has a divestment policy that says “in specific instances where the University’s social responsibility as an investor is questioned” they must respond by considering “the injurious impact which the activities of a company are found to have on consumers, employees, or other persons.”
The injurious impacts of climate change are undeniable and escalating. Universities are much more than financial institutions and that is a very good thing: they are inspiring places built on the idea that the knowledge we learn can be used to better both ourselves and the world at large. They are institutions perfectly poised to lead our country boldly into the future and moral actions based on fact should undeniably be part of that vision.
Holding stocks in fossil fuel companies means you are hoping that they will do well, sell a lot of carbon, make a lot of money, and that nothing will get in the way of these things happening. You are betting against effective action on greenhouse gas emissions. This is not a bet that any responsible university can continue to make.
As university students we don’t have much in the way of social capital to help us change the world. We ride our bicycles, read our books, suffer through exams, and don’t typically run corporations, draft laws or speak to people through their TVs.
Instead, what we have is a collective voice as the upcoming generation. Fossil fuel divestment is an entirely responsible move on climate change spurred by a generation not nearly as naive as some would have you believe. We are ready to act on climate change. If you’re not willing to lead, we are ready to make the first move. The time to divest is now.
