Stanford becomes wealthiest university to divest
On Tuesday, Stanford University became the wealthiest U.S. university to pledge divestment from coal companies.
The Stanford Board of Trustees decided the school will not make direct investments of endowment funds in publicly traded coal companies, according to a press release. While other universities have already taken similar action, Stanford’s $18.7 billion endowment makes it the largest institution of higher education to divest from sectors of the fossil fuel industry. The Yale endowment was valued at $20.8 billion as of June 2013. Stanford students and administrators interviewed said the vote was spurred by student activism.
“This is something that the students brought to our attention a year ago,” said associate vice president and Stanford’s director of communications Lisa Lapin. “The students deserve a lot of credit. They are the ones who brought these issues to the attention of the university.”
Lapin said that after the student group Fossil Free Stanford presented to Stanford’s Advisory Panel on Investment Responsibility and Licensing, the panel made a recommendation to the board of trustees.
Yari Greaney, a member of Fossil Free Stanford, said that recent weeks have seen significant progress. Last month, the university held a referendum, and the vast majority of students who participated in the vote supported divestment. More recently, Fossil Free Stanford presented letters in support of divestment from roughly 200 alumni.
Greaney added that the group’s recommendation was taken very seriously and that the board of trustees voted quickly on divestment.
Still, the university did not vow to divest its assets from all segments of the fossil fuel industry, but only from coal-mining firms.
“Stanford has a responsibility as a global citizen to promote sustainability for our planet, and we work intensively to do so through our research, our educational programs and our campus operations,” Stanford President John Hennessy said in the release. “Moving away from coal in the investment context is a small, but constructive, step while work continues, at Stanford and elsewhere, to develop broadly viable sustainable energy solutions for the future.”
As a result of the trustees’ vote, Stanford will not invest in approximately 100 publicly traded companies for which coal extraction is the primary business and will divest from any current direct holdings in such companies, the press release said.
Stanford will also recommend that its external investment managers avoid investing in coal-mining companies.
While Greaney noted the university’s action was a “huge victory,” she added that Fossil Free Stanford will continue to advocate divestment from the entire fossil fuel industry.
Greaney added that Fossil Free Yale has effectively channeled student support for divestment and said that she hopes Stanford’s action will push other administrations to follow suit.
Last month, Pitzer College decided to divest its assets from fossil fuels. By the end of this year, Pitzer will sell about $4.4 million in fossil fuel related investments, mainly in oil and gas companies, from the school’s $125 million endowment.
“One action alone cannot bring the coal industry down, but a series of movements can,” Greaney said.
The Yale Corporation Committee on Investor Responsibility has the final authority on divestment at Yale. The Corporation has yet to announce a decision on whether the University will take steps toward divesting its endowment from the fossil fuel industry.