Yale University’s endowment has refused to divest from fossil fuel companies, but instead said it would ask external managers to consider the effects of climate change on investments.
Responding to a vigorous student-led campaign, the Yale Corporation Committee on Investor Responsibility (CCIR) said divestment is not the “right means of addressing this serious threat” of climate change for the $20.8 billion endowment.
The committee argued that targeting the supply side “largely on account of emissions by other actors downstream from them” and disregarding the demand side would be “misdirected.”
“It does nothing to improve public or private policies that are capable of addressing the problem, either in the US or globally, including by incentivizing the substitution or development of technologies and behaviors that may ameliorate greenhouse gas buildup,” the committee said.
It called divestment a “measure of last resort”—one appropriate only in response to “grave social injury” brought on by climate change.
“We believe that the actions Fossil Free Yale proposes Yale take… are neither the right means of addressing this serious threat nor would they be effective.” –Yale Corporate Committee on Investor Responsibility.
Instead of divesting, Yale’s President Peter Salovey said CIO David Swensen plans to urge managers to account for climate change risk and “anticipate possible future regulatory actions in response to the externalities produced by the combustion of fossil fuels.”
“Yale has a role as an investor as the actions of the CCIR and the investments office show, but I believe that Yale’s most important contributions come from its teaching and research, its internal practices, and its leadership by example, and encouragement among peer institutions.”
The Ivy League university also allotted $21 million for on-campus energy conservation, greenhouse gas reduction, and the installation of solar panels.
Yale is one of a number of schools such as Harvard that chose not to divest from fossil fuel investments in the face of student pressure. Stanford University, however, recently announced plans to dump shares of coal producers while retaining stakes in fossil fuel.
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