Petition

swat support divestment

Last semester was huge for the fossil fuel divestment campaign at Swarthmore. In November, Swarthmore’s largest investment consultant, Cambridge Associates, announced that it is willing to actively assist Swarthmore in divesting from fossil fuels, meaning a plan for divestment is now just a phone call away. In December, 100 students delivered a petition to the Board of Managers signed by over 800 students (a majority of the student body!) calling for a commitment to divest. Our message is clear: Swarthmore has a historic opportunity to align our investments with our institutional values, shield our endowment from the carbon bubble, and make a powerful statement on climate ahead of the pivotal UN Climate Conference this fall.

In the three years since it began here at Swarthmore College, the international divestment movement has grown to over 500 campaigns around the world. The movement has assembled a groundbreaking coalition of universities, cities, religious institutions, and world leaders including World Bank President Jim Yong-Kim, U.N climate chief Christiana Figueres ‘79, and U.N General Secretary Ban Ki-Moon. The Rockefeller Foundation (built off the wealth of Standard Oil Company), major Swedish and Norwegian pension funds valued at over $100 billion, and Stanford University all made divestment commitments in 2014.

Their message is clear: fossil fuel investments are incompatible with a just and sustainable future. Every year, climate change and our fossil fueled energy infrastructure causes millions of deaths, and the potential damage wrought by unchecked fossil fuel extraction is unthinkable. In this historic context, we have an unprecedented opportunity to make Swarthmore a leader in this international movement and live up to our institutional value of social responsibility by ending investments in deadly fossil fuels and reinvesting in the growing, sustainable economy.

Divestment has put the fossil fuel industry on the defensive, challenging their power and beginning to shift the conversation on climate. The Alberta Oil Magazine warned that “energy executives ignore the [divestment] campaign at their own peril.” The Minerals Council of Australia, a coal industry group, is even attempting to make divestment illegal, claiming that it unduly burdens them because “stigmatization makes it difficult for an industry to engage with its customers, attract employees and more importantly access capital for investment purposes.” NRG, one of the largest electricity companies in the U.S, recently pledged to cut 90% of their carbon emissions by 2050, citing the political pressure from the divestment movement as a significant influence in this decision.

The financial risk posed by unburnable carbon to our endowment’s long-term health is clear. As Bevis Longstreth, who served as commissioner of the SEC under Ronald Reagan, argues, “fiduciaries have a compelling reason, on financial grounds alone, to divest these [fossil fuel] holdings before the inevitable correction occurs.” According to McGraw Hill and Standard and Poors estimates, fossil fuel shares have underperformed the market average by nearly 10 percent over last decade.

And fossil fuel investments are likely to become increasingly bad investments. If the world takes the necessary action to avoid catastrophic climate change (which UN scientists say means warming must not exceed 2 degrees Celsius), fossil fuel companies must leave 60% to 80% of current carbon reserves in the ground, stranding $20 trillion in assets. According to the investment bank HSBC, this would lead to a devaluation of fossil fuel companies by 40% to 60%. Obviously, we do not want to be invested in an industry when it takes that kind of hit. U.K. Energy Secretary Ed Davey warned that fossil fuel stocks could be the “sub-prime assets of the future.” And as UN Climate Chief Christiana Figueres ‘79 notes, climate science dictates that “we will move to a low-carbon world because nature will force us, or because policy will guide us,” and that continued fossil fuel investments constitute a “blatant breach of fiduciary duty.”

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One thought on “Petition

  1. Divestment is more than a naked action. It represents taking a careful, conscious, and more sustainable path into the future.

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