{"id":5929,"date":"2013-10-08T09:54:22","date_gmt":"2013-10-08T13:54:22","guid":{"rendered":"http:\/\/www.l-a-k-e.org\/blog\/?p=5929"},"modified":"2013-10-08T10:39:35","modified_gmt":"2013-10-08T14:39:35","slug":"harvard-excuses-for-not-divesting-from-fossil-fuels","status":"publish","type":"post","link":"http:\/\/www.l-a-k-e.org\/blog\/2013\/10\/harvard-excuses-for-not-divesting-from-fossil-fuels.html","title":{"rendered":"Harvard excuses for not divesting from fossil fuels"},"content":{"rendered":"

\r\nDrew Faust wants us to believe Harvard can’t figure out how to power its\r\nown campus and vehicles on renewable solar, wind, wave, and tidal energy?\r\n\r\n<\/a>\r\nCome on, pull the other one!\r\n

\r\nPresident Faust wrote that\r\ndivestment would make Harvard appear “as a political actor rather than an academic institution”,\r\nthat Harvard might not make enough money,\r\nthat “Universities own a very small fraction of the market capitalization of fossil fuel companies”, and that\r\n“I also find a troubling inconsistency in the notion that, as an\r\ninvestor, we should boycott a whole class of companies at the same\r\ntime that, as individuals and as a community, we are extensively\r\nrelying on those companies’ products and services for so much of\r\nwhat we do every day.”\r\nThe first three excuses would have applied just as much back in the 1980s\r\nwhen\r\n\r\nHarvard finally divested from companies dealing in apartheid in South Africa<\/a>, a symbolic, and yes, political action that contributed markedly to the\r\nrelease of Nelson Mandela, the downfall of the apartheid regime, and later\r\nthe election of Nelson Mandela as president of South Africa.\r\n

\r\nHarvard President Derek Bok, 18 May 1990,\r\n\r\nin a letter to students<\/a>\r\nexplaining the Unversity’s September 1989 decision\r\nto divest from tobacco companies, since completed:\r\n<\/p>\r\n\r\n<\/a>\r\n

\r\n

\r\n\r\nIn reaching its decision, the corporation was motivated by a desire\r\nnot to be associated as a shareholder with companies engaged in\r\nsignificant sales of products that create a substantial and\r\nunjustified risk of harm to other human beings.\r\n<\/p>\r\n<\/blockquote>\r\n

Harvard divestment was good enough for apartheid and tobacco.\r\n

\r\n\r\n<\/a>\r\nIn veritas, Harvard can have just as much or more influence by divesting\r\nfrom fossil fuels, and that cause is even more important for the whole world.\r\nIn south Georgia truth, so can\r\n\r\nValdosta State University in its own region<\/a>.\r\n<\/p>\r\n

\r\n\r\n<\/a>\r\nOffice of the President, Harvard,\r\n3 October 2013,\r\n\r\nFossil Fuel Divestment Statement<\/a>;\r\nI added the links and images, all directly related to Harvard.\r\n

\r\n

\r\nDear Members of the Harvard Community,\r\n<\/p>\r\n

\r\n\r\n<\/a>\r\nClimate change represents one of the world’s most consequential\r\nchallenges. I very much respect the concern and commitment shown by\r\nthe many members of our community who are working to confront this\r\nproblem. I, as well as members of our Corporation Committee on\r\nShareholder Responsibility, have benefited from a number of\r\nconversations in recent months with students who advocate divestment\r\nfrom fossil fuel companies. While I share their belief in the\r\nimportance of addressing climate change, I do not believe, nor do my\r\ncolleagues on the Corporation, that university divestment from the\r\nfossil fuel industry is warranted or wise.\r\n<\/p>\r\n

\r\n\r\n<\/a>\r\nHarvard is an academic institution. It exists to serve an academic\r\nmission — to carry out the best possible programs of education\r\nand research. We hold our endowment funds in trust to advance that\r\nmission, which is the University’s distinctive way of serving\r\nsociety. The funds in the endowment have been given to us by\r\ngenerous benefactors over many years to advance academic aims, not\r\nto serve other purposes, however worthy. As such, we maintain a\r\nstrong presumption against divesting investment assets for reasons\r\nunrelated to the endowment’s financial strength and its ability to\r\nadvance our academic goals.\r\n<\/p>\r\n

\r\n<\/a>\r\nWe should, moreover, be very wary of steps intended to\r\ninstrumentalize our endowment in ways that would appear to position\r\nthe University as a political actor rather than an academic\r\ninstitution. Conceiving of the endowment not as an economic\r\nresource, but as a tool to inject the University into the political\r\nprocess or as a lever to exert economic pressure for social\r\npurposes, can entail serious risks to the independence of the\r\nacademic enterprise. The endowment is a resource, not an instrument\r\nto impel social or political change.\r\n<\/p>\r\n

\r\n<\/a>\r\nWe should also be clear-sighted about the risks that divestment\r\ncould pose to the endowment’s capacity to propel our important\r\nresearch and teaching mission. Significantly constraining investment\r\noptions risks significantly constraining investment returns. The\r\nendowment provides more than one-third of the funds we expend on\r\nUniversity activities each year. Its strength and growth are crucial\r\nto our institutional ambitions — to the support we can offer\r\nstudents and faculty, to the intellectual opportunities we can\r\nprovide, to the research we can advance. Despite some assertions to\r\nthe contrary, logic and experience indicate that barring investments\r\nin a major, integral sector of the global economy would —\r\nespecially for a large endowment reliant on sophisticated investment\r\ntechniques, pooled funds, and broad diversification — come at\r\na substantial economic cost.\r\n<\/p>\r\n

\r\n\r\n<\/a>\r\nBecause I am deeply concerned about climate change, I also feel\r\ncompelled to ask whether a focus on divestment does not in fact\r\ndistract us from more effective measures, better aligned with our\r\ninstitutional capacities. Universities own a very small fraction of\r\nthe market capitalization of fossil fuel companies. If we and others\r\nwere to sell our shares, those shares would no doubt find other\r\nwilling buyers. Divestment is likely to have negligible financial\r\nimpact on the affected companies. And such a strategy would diminish\r\nthe influence or voice we might have with this industry. Divestment\r\npits concerned citizens and institutions against companies that have\r\nenormous capacity and responsibility to promote progress toward a\r\nmore sustainable future.\r\n<\/p>\r\n

\r\n\r\n<\/a>\r\nI also find a troubling inconsistency in the notion that, as an\r\ninvestor, we should boycott a whole class of companies at the same\r\ntime that, as individuals and as a community, we are extensively\r\nrelying on those companies’ products and services for so much of\r\nwhat we do every day. Given our pervasive dependence on these\r\ncompanies for the energy to heat and light our buildings, to fuel\r\nour transportation, and to run our computers and appliances, it is\r\nhard for me to reconcile that reliance with a refusal to countenance\r\nany relationship with these companies through our investments.\r\n<\/p>\r\n

\r\nI believe there are a number of more effective ways for Harvard both\r\nto address climate change and to enhance our commitment to\r\nsustainable investment.\r\n<\/p>\r\n

\r\n\r\n<\/a>\r\nOur teaching and research on environmental and climate issues is\r\nsignificant and growing, and it is a priority in The Harvard\r\nCampaign.\r\n<\/p>\r\n

\r\nWe offer some 250 courses in the broad domain encompassing\r\nenvironmental studies and energy. We support some 225 faculty who\r\nwork in the area, as well as a graduate consortium that involves\r\nmore than 100 students and seven Schools.\r\n<\/p>\r\n

\r\nWe have a thriving University Center for the Environment.\r\nOutstanding faculty in chemistry, biology, earth and planetary\r\nsciences, engineering, and beyond are making profoundly important\r\ncontributions to envisioning the future of energy and shaping the\r\nrelevant science and technology. The Kennedy School’s Belfer Center\r\nhas won international acclaim for its influential work on climate\r\n\r\n<\/a>\r\nchange economics and policy. Harvard scholars in design are on the\r\nfrontier of thinking about sustainable cities; scholars in law,\r\nbusiness, economics, and public policy are leaders in addressing\r\nregulatory, commercial, and economic aspects of energy and the\r\nenvironment; scholars in public health do vital research on\r\nenvironmental health and its relation to energy use. Indeed, the\r\nfoundation of our current national clean air regulations was a study\r\nundertaken more than two decades ago by faculty at the Harvard\r\nSchool of Public Health.\r\n<\/p>\r\n

\r\n\r\n<\/a>\r\nWe also have a strong institutional commitment to sustainability in\r\nhow we live and work. Our Office for Sustainability is doing\r\noutstanding work. We are making substantial progress in reducing our\r\ngreenhouse gas emissions. We have become much more conscious of\r\nsustainable design principles in all of our physical planning and\r\nconstruction. We have created awards to recognize\r\n“heroes” who are helping to make Harvard green. And\r\nHarvard has earned an array of honors to recognize various\r\nsustainability efforts. I am very proud of all that our students and\r\nfaculty and staff are doing on this front, and those efforts will\r\ncontinue and grow.\r\n<\/p>\r\n

\r\n\r\n<\/a>\r\nAs a long-term investor, we need to strengthen and further develop\r\nour approach to sustainable investment. This is no small\r\nundertaking, and it will present challenges along the way.\r\nEspecially given our long-term investment horizon, we are naturally\r\nconcerned about environmental, social, and governance factors that\r\nmay affect the performance of our investments now and in the future.\r\nSuch risks are complex, often global in nature, and addressing them\r\neffectively often entails collaborative approaches. Generally, as\r\nshareholders, I believe we should favor engagement over withdrawal.\r\nIn the case of fossil fuel companies, we should think about how we\r\nmight use our voice not to ostracize such companies but to encourage\r\nthem to be a positive force both in meeting society’s long-term\r\nenergy needs while addressing pressing environmental imperatives.\r\nAnd, like other investors, we should consider how to obtain further,\r\nbetter information on how companies not only in the energy industry\r\nbut across all sectors take account of sustainability risks and\r\nopportunities as part of their business strategies and practices.\r\n<\/p>\r\n

\r\n\r\n<\/a>\r\nTo help us pursue this path, Harvard Management Company has recently\r\nbrought on its first-ever vice president for sustainable investing.\r\nShe will help us think in more nuanced, forward-looking ways about\r\nsustainable investment, including the consideration of\r\nenvironmental, social, and governance factors. And, in concert with\r\ncolleagues, she will play a central role in considering how Harvard\r\ncan achieve superior investment returns as it fulfills a\r\nuniversity’s distinctive responsibilities to society.\r\n<\/p>\r\n

\r\n\r\nHarvard has a strong interest in marshaling its academic resources\r\nto help meet society’s most important and vexing challenges, and\r\nthere is no question that climate change must be prominent among\r\n\r\n<\/a>\r\nthem. We will continue to do so, through the energy and ideas of our\r\nfaculty, students, and staff, in ways that are true to the purposes\r\nof our endowment and that best take advantage of the University’s\r\ndistinctive capacities as an academic institution.\r\n<\/p>\r\n

\r\nSincerely,\r\n
\r\nDrew Faust\r\n<\/p>\r\n<\/blockquote>\r\n

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