The demand for universities to divest from fossil fuel companies is growing. In Canada, there are 22 universities with divestment campaigns organized by student and faculty groups.
“That number keeps growing, The University of Alberta just started a campaign,” Katie Rae Perfitt, Canadian divestment organizer at 350.org, told Ricochet in a telephone interview. “It’s hard to have a complete picture because there are campaigns that keep popping up.”
The UN climate summit in Paris highlighted that to avoid more environmental catastrophe the planet cannot surpass 2C of warming. According to many activists, divestment from fossil fuels is an important step for Canada to reach that goal.
“If we’re going to stay within two degrees of warming we’re going to need to keep 80 per cent of fossil fuel reserves in the ground,” said Perfitt.
And it’s not just about the planet; it’s about money too.
Multiple studies show that investment in fossil fuel companies is becoming riskier.
So far over 500 institutions of various kinds worldwide have committed to divest from fossil fuels. As the divestment movement gains momentum, however, university administrations appear to be entrenched in their anti-divestment positions. Many say this sends the wrong message.
Public supports climate action
“Our political leaders look to public institutions for guidance and we need to be setting an example and making it easier for them to do the right thing,” said Amanda Harvey Sanchez of Toronto 350 in a telephone interview. “They need to know the public supports strong climate action.”
Most recently, the University of Toronto, Canada’s largest university, decided against allocating up to 5 per cent of its endowment fund to fossil fuel companies.
“We recognize that there are certain instances it is appropriate and necessary to divest if our values don’t align with our investments, and that is clearly the case with fossil fuels,” said Harvey Sanchez. “That was shown in the president’s expert committee report, and for him to go against that is kind of ridiculous.”
The University of Toronto declined an interview with Ricochet. A statement on the university’s website says that the university needs to go beyond a blanket approach based on divesting from fossil fuel companies.
Investing in energy transition
“The challenge with fossil fuels divestment is that it only addresses one-quarter of Canada’s greenhouse gas emissions, and ignores those activities such as transportation, manufacturing, construction and buildings that collectively generate the bulk of our emissions,” Meric Gertler, U of T president, is quoted as saying on the university’s website. “If we’re serious about addressing climate change, we need a strategy that alters behaviour and encourages more progressive practices across the entire economy and society.”
Gertler denied the university is directly invested in any of the companies the report urged the university to divest from. The president says the university will focus on an investment strategy guided by environmental, social and governance practices decided by the university’s investment managers.
The University of Toronto is not the only university that recently rejected divestment. McGill has too, and, as with the University of Toronto, the decision caused uproar from both students and faculty.
“McGill should invest in green technology, more research,” said Chloe LaFlamme of Divest McGill. “I think that the main thing is that we can’t be fully committed to an energy transition if we’re still invested in the fossil fuel sector.”
McGill’s administration has made clear that it recognizes the need for urgent action to prevent climate change.
In a letter to Divest McGill, the university’s Principle and Vice-chancellor Suzanne Fortier wrote, “Climate change is a serious threat to humanity, and unless urgent action is taken we will see catastrophic effects on our planet and its peoples. The Committee to Advise on Matters of Social Responsibility report reiterates that climate change, linked significantly to the burning of fossil fuels, is having an ‘injurious impact.’”
‘Out of touch’ administrators
The division between administration and those in favour of divestment lies in how to go about fixing the problem.
“We do not see that divestment would be an effective or meaningful form of action to address climate change at this time,” wrote Vincent Allaire, media relations officer at McGill, in an email statement. “CAMSR believes there are more effective ways for McGill to address climate change.”
Instead, the university will be applying the recommendations in the report by the Committee to Advise on Matters of Social Responsibility. This includes developing and implementing the same ESG principles recommended in U of T’s report.
“I really think that they are out of touch with the community, the academic staff and the professors, a lot of them are on board, a lot of the students are on board, we have over 2,000 signatures on our petition, said LaFlamme. "They don’t realize that this isn't something that’s only brought forward by a small group of students; it has the support of a large group of people."
University of British Columbia rejects divestment
And it’s not universities in the east who are advocating for divestment. Divest UBC was also disappointed to hear their board of governors decided against divestment.
“We’ve seen rejection all across the country so that’s something we are conditioned for,” said Regan Eberding, a member of UBC350. “But the fact that their fiduciary duty as board of governors is to the donors of the fund instead of to the faculty and students and the institution itself is kind of mind boggling. “
The reaction from students countrywide can’t be ignored. On April 1, 2016, Divest McGill held a diploma returning ceremony in order to demonstrate their frustration with the board of governors’ decision bringing more attention to the cause.
Only the beginning
“Since we had our alumni ceremony we’ve had over 100 alumni sign on to our letter and 50 more have pledged to return their diplomas,” said LaFlamme. “So this is only the beginning, the more people jump on board it’s going to be a lot harder for the administration to justify a decision that’s against what the community wants.”
“Ultimately with the knowledge that 80 per cent of fossil fuels need to stay in the ground there is this ideology that if we’re valuing these assets as something a company has that can’t actually be used then these stocks are going to drop,” said Eberding.
“They’ll have to do it from a financial standpoint at some point but at that point it’s not taking leadership. I think they will divest, whether it be formal or informal, but the action really is about doing it now and doing it ahead of the curve.”