Divestment Movement Aims at New Target as University of California Ditches Coal
One week after President Obama visited a village in the Alaskan Arctic that faces destruction from global warming, the University of California announced that it would no longer invest its $100 billion portfolio in coal mining or tar sands oil.
Activists cheered, although neither they nor the university have characterized it as the definitive tipping point in the growing fossil fuel divestment movement.
Writing Thursday in the San Francisco Chronicle, Jagdeep Singh Bachher, the University of California chief investment officer, explained that the institution has shed $200 million in direct holdings in coal mining and tar sands oil.
“The move is part of our new risk-review process that more comprehensively considers environmental sustainability, social responsibility and governance risks in our investment strategy,” Bachher wrote.
Dianne Klein, a spokesperson for the university, said UC would consider climate change-related risks for future investments. About $10 billion of the university’s investments remain in fossil fuels and related industries, she said.
“We firmly believe that if we don’t consider these aspects of a potential investment, such as its impact on climate change and other factors we are going to lose money, long term,” said Klein.
“Our chief responsibility is fiduciary,” Klein said. “We do believe that our taking a stand on these issues is influential. But I would not portray us in a moral sense; this is smart investing.”
On Sept. 2, the California legislature passed a bill requiring the state’s pension systems, known as CalPERS and CalSTRS, to divest their roughly $200 million worth of holdings in coal. Activists have charged that the two funds lost roughly $5 billion in 2014 due to falling stock prices among its fossil fuel investments.
Fossil Free UC hailed the news as the culmination of a three-year activist campaign.
“This is a big deal, and an important first step that takes $200 million away from companies like Peabody,” a major U.S. coal firm, “but we need our schools to take a stance against Exxon and Shell too,” Alden Phinney, a UC Santa Cruz student, said in a statement. “They’re every bit as responsible for the climate crisis.”
Bachher rejected an all-or-nothing investment strategy on fossil fuels. “Blanket divestment from fossil fuels grabs headlines,” he wrote in the Chronicle, “but doesn’t actively address climate change.”
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Divestment advocates believe otherwise, and now some Seattle activists have homed in on another big target. They are publicly pressuring the Bill and Melinda Gates Foundation to divest its $43 billion endowment from coal and oil, arguing that by not taking a stand against burning fossil the foundation is undercutting its own work.
The 15-year old foundation, created by the Microsoft founder and his wife, has become one of the world’s pre-eminent forces fighting AIDS, polio, malaria, and other health problems.
“Bill and Melinda Gates are such moral leaders that their divestment can create an environment which is more conducive to political and social action on climate change,” said Gates Divest campaigner Alec Connon, who works with the international climate action group 350.org.
The University of California’s partial divestment “does help,” he added. “But I would certainly argue that the Bill and Melinda Gates Foundation is a much more visible organization, “and could “have arguably a greater impact than the divestment of any other institution that has divested to date.”
The Gates Foundation did not respond to a request for comment.
In March, the Guardian newspaper partnered with 350.org to press the Gates Foundation on its fossil fuel investments.
While Bill Gates has stated publicly that he sees divestment as an ineffective weapon against climate change, the Gates Foundation may have already shifted a substantial amount of its endowment out of fossil fuels. In 2013, the foundation listed $1.35 billion in energy investments; by the end of 2014 that number was down to $420 million, according to its financial statements.
In June, the Financial Times reported that Gates planned to invest $2 billion in renewable energies and to double the investment by 2020 to fight global warming.
Disclosure: TakePart and The Bill and Melinda Gates Foundation are involved in a collaboration to produce editorial content focused on issues of global health and development that is funded by the Gates Foundation.
Related stories on TakePart:
• Fossil Fuel Divestment Hits a Roadblock in San Francisco
• In Seattle, Environmentalists Fight to Block Shell’s Arctic Drills
Original article from TakePart
