From the Protect Our Pensions October Newsletter:
In a recent ruling, a Massachusetts Appeals court concluded for a second time that Harvard University is not legally required to divest the university’s fund from the fossil fuel industry. The ruling officially stated that the students and alumni who argued for fossil fuel divestment “failed to demonstrate special standing, count one fails to state a claim upon which relief may be granted, and was properly dismissed.’’
Each year, university boards face protests from groups demanding divestment action be taken to discourage further use of fossil fuels. But like any other fund – pension fund, investment fund, etc. – university boards have a fiduciary responsibility to see that the fund thrives with a steady return on investments, meaning decisions cannot be based upon social whims.
Harvard University isn’t the only school to recognize this responsibility. Below are just a few schools that believe divestment is not the correct action to meet a school’s goals:
“This endowment payout represents one of the largest sources of annual funds for the university’s budget – twice as large as Stanford tuition. To meet these needs, the endowment invests broadly in economic activity around the world.
“Stanford is deeply engaged in finding alternatives through its research. However, despite the progress being made, at the present moment oil and gas remain integral components of the global economy, essential to the daily lives of billions of people in both developed and emerging economies. Moreover, some oil and gas companies are themselves working to advance alternative energy sources and develop other solutions to climate change. The complexity of this picture does not allow us to conclude that the conditions for divestment outlined in the Statement on Investment Responsibility have been met.” – Board of Trustees, April 25, 2016
“At the forefront of our deliberations was the role of NYU’s endowment. Its prime purpose is to support the University’s academic and research missions; as NYU’s fiduciaries, the prudent investment of the endowment is among the Board’s weightiest duties. Particularly given NYU’s low per-student endowment, any consideration that would depart from that prime purpose should be subject to a very high bar of scrutiny. We applaud the efforts of faculty, students, and staff to advocate for addressing climate change and in proposing divestment, but do not support NYU using its endowment as a tool for simply making statements.” – William Berkley, Chair of the NYU Board of Trustees and Andrew Hamilton, NYU President, June 16, 2016
“We want our investment decisions, our treasurer, to be basing those decisions on the best interests of the university and the return to the university. The University of Colorado’s investment decisions must first and foremost advance the institution’s financial interests and support its academic mission.” – John Caron, University of Colorado Board of Regents Member, April 16, 2015
“Nearly all acknowledge that there is no practical plan by which we could cease using fossil fuels in the immediate future and continue the work of the University. It seems to me at least a practical inconsistency to attempt to stigmatize an industry, as proponents of divestment hope, from which, we admit, we must purchase.” – University president Fr. John Jenkins, September 20, 2016
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