An article in Wednesday’s New York Times features students at Swarthmore College who are pushing the institution to sell off its endowment holdings in fossil-fuel companies. According to the Times, the students hope that such a shift “could force climate change, barely discussed in the presidential campaign, back onto the national political agenda.”
More important, the theory goes, by encouraging companies (particularly in the oil, coal, and gas industries) to increase their research into renewable, noncarbon sources of energy, the colleges could help reduce carbon emissions to what scientists say is a safe level of carbon dioxide in the atmosphere, 350 parts per million, down from the current level of about 390.
The push for basing investment decisions on sustainable criteria is not a new one. For several years in the mid-to-late aughts, the Rockefeller Philanthropy Advisors supported a project called the Sustainable Endowments Institute, which urged campus-based energy efficiency as well as endowment investments in companies using or developing renewable energy. From 2007 to 2012, the institute produced an in-depth “report card” of participating universities that rated them on their performance.
However, the institute was competing with several other organizations that were also trying to create a ranking system for campus sustainability, including the Association for the Advancement of Sustainability in Higher Education’s STARS system, the Princeton Review’s list of Green Colleges, Sierra Magazine’s “Cool Schools” feature, and a handful of others.
The array of competing surveys fatigued administrators and created a tangle of confusing priorities. For example, should colleges weight operational changes, such as serving local food in the cafeteria, as more or less valuable than investment in research and development of new technology?
However, the biggest challenge to the report card was the perception that sustainability, however noble, was a financial loser for universities. Early in 2012, the institute announced that it would fold the report card and instead focus on a different project—the Billion Dollar Green Challenge, which emphasizes the financial returns available to colleges that create “green” revolving funds for energy-efficient maintenance.
The financial imperative is an even bigger obstacle to those Swarthmore students. The Times reports that although some small colleges have agreed to reconsider their stockholdings in fossil-fuel companies, such as Unity College and Hampshire College, no college with an endowment larger than $1-billion has agreed to divest along those lines.
Despite its student activism, Swarthmore is in that category, with an endowment of $1.5-billion:
“The college’s policy is that the endowment is not to be invested for social purposes” beyond the obvious one of educating students, said Suzanne P. Welsh, vice president for finance at the school. “To use the endowment in support of other missions is not appropriate. It’s not what our donors have given money for.”
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