Time to divest
On a recent visit to New Haven, I was very pleased to learn of the active movement to get Yale to divest from the fossil-fuel companies that are quite literally ruining the planet.
Those promoting divestment, myself included, are not expecting Exxon to crumble. But there is a compelling need for the U.S. to get on a path of reducing its greenhouse gas emissions by about 6.5% a year between 2015 and 2050, and everyone should be taking whatever actions they can, including Yale. Climate disruption is not an ordinary issue. As leading investor Jeremy Grantham has noted, climate change “is not only the crisis of your lives — it is also the crisis of our species’ existence.”
The ethical case for divestment is a powerful one. Ethical investors like Yale should not be partaking of the profits made by companies that are knowingly and irresponsibly ruining the planet for future generations and, beyond that, effectively ensuring that little or nothing is done about it.
More practically, if more and more people join in the effort (as is happening), the campaign will have a major educational impact, shame the fossil companies and make everyone associated with them think a little harder.
Finally, every movement requires victims and villains. We have seen the ranks of the coal, fracking, pipeline and other fossil fuel victims grow, and now we are seeing the rapid growth of actual climate change victims. On the other hand, the villainry has been diffused Pogo-like into “we have met the enemy and it is us.” What Bill McKibben and 350.org are now doing brilliantly is changing that by fingering, quite correctly, the fossil giants as the villains. For the first time, a real movement to head off climate disaster is building.
These are the reasons I’d urge Yale to embrace divestment: ethical imperative (ill-gained money), educational impact and movement building. If in addition the campaign raises the price of capital and drives up fossil fuel prices, all the better.
I am aware of some arguments on the other side of this issue. To claim that Yale would be diminishing its investment returns is an argument that denies the objective of investing ethically. If we look closely at what’s going on — to the climate and in our politics — investing in fossil fuels is not a close call. It’s clearly wrong. It’s also time to replace the strategy of working for change as a shareholder with something more effective.
My hope is that Yale will demonstrate real leadership here.
James Gustave Speth
The author is a former dean of the School of Forestry and Environmental Studies, a 1969 graduate of the Yale Law School and a 1964 graduate of Jonathan Edwards College.