Over the past year, Divest Dartmouth has lobbied the College administration to remove the endowment’s investments from fossil fuel companies. Through respectful but persistent effort, the divestment movement recently won a major victory when, on March 25, student leaders Noah Cramer ’16, Morgan Curtis ’14 and Leehi Yona ’16 met with College President Phil Hanlon to discuss a letter from Divest Dartmouth to the Board of Trustees explaining the movement.. From an alumus who’s gone on to earn a master’s degree in international environmental policy and work extensively on climate adaptation and clean energy finance, here’s why divestment at Dartmouth is no longer a matter of if, but when.
First, if done correctly, divestment would have no impact on the endowment’s return. A growing number of funds based on environmental, social and government criteria show that responsible investing need not be at odds with the trustees’ fiduciary duties. Investment firm RBC Wealth Management found a “carbon free” index fund actually outperformed Morgan Stanley’s All Country World Index, a standard investment benchmark, by a sizable margin over the past 15 years, with negligible added risk. HIP Investors, the firm hired to advise the city of Seattle on its pension fund, reached similar conclusions.
These are not the unsupported theories of fringe groups. HSBC and Goldman Sachs both released reports in the last year warning about the trillions of dollars in fossil fuel assets that will be “stranded” when climate regulations ramp up in coming years. Goldman even said that the “window for profitable investment in coal mining is closing.” And yet, Dartmouth still maintains sizable holdings in these risky, outdated companies.
Second, if Dartmouth does not reform its investment holdings soon, it will become a dinosaur in the higher education world. Understandably, the Board may have been hesitant to consider divestment when the concept was new and unproven, but that is no longer the case. Nationwide, 11 colleges and dozens of cities, towns, churches and foundations have already committed to divest. Earlier this month, Harvard University, with the largest endowment of any university in the world, pledged to apply the Principles for Responsible Investment developed by the United Nations Global Compact, which are a step toward full divestment. If there is anyone left on Dartmouth’s Board who feels responsible investing just cannot work in the Ivy League, Harvard’s announcement should dispel those thoughts.
Third, divestment is worthwhile because it challenges the social license to operate upon which oil, coal and gas companies depend to maintain their legitimacy. As a concept, the social license to operate measures our collective willingness to allow a company to do business in our community. Although most of us do not trust or approve of dirty industries, we often accept them because the negative impacts are felt elsewhere.
Divestment from fossil fuel companies by progressive, thoughtful institutions like Dartmouth, just like divestment from South African companies during apartheid, sends a clear message that these companies have lost their legitimacy as beneficial social actors. Divestment is a necessary part of the transformation to a post-carbon economy, in which BP, Exxon Mobil, Peabody Energy and others become forward-thinking energy companies. Although we must kick our own addiction to carbon — beginning with campus’s continued reliance on No. 6 fuel oil, a filthy 19th-century technology — we must also think globally.
Fourth and finally, our age’s moral and thought leaders are united in opposition to fossil fuel companies’ unchecked aggression against the well-being of future generations. It is not coincidental that Archbishop Desmond Tutu, who stood alongside Nelson Mandela in fighting apartheid, recently wrote in The Guardian about the urgency of applying both economic and moral pressure on the world’s biggest polluters.
Students who study abroad already witness the consequences of inaction. From the melting glaciers of the Alps to the drought-stricken fields of the American West, we are living in the Anthropocene, an age of rapid, human-caused environmental change and massive biocultural extinction. We are not just losing physical landscapes — we are losing diverse and valuable human cultures.
The time for action is now. The place is Dartmouth.
Matt Nichols '12 is a guest columnist.
