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With COP 21 fast approaching, Canadians are increasingly scrutinizing their country’s carbon footprint. But while national and provincial policies dominate much of the media coverage, a vigorous academic movement is gaining ground on campuses across the country.
It’s the case for divestment, and it’s growing by the day. Students, faculty and staff from more than 30 universities are calling for their schools to trade in their carbon-heavy investments for more climate-friendly alternatives. It’s a move that would impact hundreds of millions of dollars in pensions and endowments, but so far, no Canadian university has fully committed to dropping fossil fuels from their portfolio.
It’s a question of ethics and finances. Universities, industry representatives, and investors alike have criticized the divestment movement, questioning its financial viability and its effectiveness as a means of environmental advocacy. Proponents have responded that the financial risks are no different than those of carbon-heavy portfolios, and that the public spectacle of divestment sends a strong message to both industry and other environmental movements.
“When you dig into some of the potential concerns, they don’t really hold water,” says Alex Hemingway, one of the organizers of the University of British Columbia’s divestment movement. “There’s been independent analysis of what the effects of divesting an investment portfolio would be, and there’s no reason to believe that the performance of the investments would be any worse.”
Earlier this month, a report released by Corporate Knights, a Canadian research company, found that some of the world’s largest pension plans have lost billions by not selling off their carbon-based investments in favour of clean energy stocks. Included among them are the Canada Pension Plan and McGill University endowment, which reportedly gave up $7 billion and $43 million respectively by not making the switch in 2012.
In a press release, Divest McGill organizer Kristen Perry noted the $43 million loss was “especially poignant in light of the $39 million in provincial cuts to McGill’s budget for 2012-2015.”
At UBC, two referendums were held to bring the issue of divestment before the board. Both succeeded, and so a committee was tasked with reviewing the proposal. Hemingway says he expects the committee could announce its recommendation as early as December, after which the board will make the final decision.
“It’s an important question for the administration at UBC,” he says. “Will they reflect the expressed will of a huge portion of the community, an overwhelming part of the community?”
Just this week, the University of Ottawa became the first Canadian university to sign the Montreal Carbon Pledge. In doing so, the university agreed to disclose the carbon footprint of its $2 billion investment portfolio each year. It’s also considering divestment in response to growing support for the movement.
Misha Voloaca, a PhD student in Experimental Psychology, helped organize the push for divestment. He says signing the carbon pledge is a good step, but professors will continue to push until the school “puts its money where its mouth is and aligns its investments with its goals as an organization.”
He adds that there’s a great irony when universities claim to promote environmental solutions while continuing to invest in fossil fuels. “When you’re saying climate change is the biggest threat to the future of humanity, and then you invest in the industries that are pushing us toward the brink, there’s no congruence there in the message,” he says.
Campaigns at the University of Toronto, McGill University, and Dalhousie University are all seeing progress with university administrations, and last December, Concordia University became the first school to pursue divestment. It launched a $5 million sustainable fund, which functions as part of its $100 million endowment.
However, not all schools are so readily accepting of divestment. In February, the University of Calgary announced it would not be pursuing the matter. It’s not alone in its conclusion. According to Wood, some universities simply won’t touch the issue regardless of financial considerations. “They seem to be disagreeing on principle,” she says, “which I find fascinating considering that they’re the ones supposed to be supporting their students.”
Relationships with carbon-heavy industries often run deeper than investments, a fact that may influence some universities’ aversion to divestment. Corporate donations and partnerships can comprise a significant amount of a school’s funding, especially in light of diminishing provincial contributions. Evidence of this branding can be seen across Canada, from frosh sponsorships to the naming of buildings. It’s understandable that universities would think twice before divesting from their benefactors. “What they believe they’re risking is their relationships,” says Wood.
The divestment movement continued is growing, and not just on campus. The United Church of Canada and the Ontario Teacher’s Pension Plan have already decarbonized, joining a growing global movement. According to 350.org, a U.S.-based NGO pushing for divestment, 492 institutions have sold their assets in carbon-heavy industries. It puts the approximate value of these conversions at $2.6 trillion dollars.
Internationally, campus movements have also been gaining ground. In the United Kingdom, 20 universities are in the process of moving their endowments out of fossil fuels, including the University of Surrey and Oxford Brookes University.
It remains to be seen whether Canada’s universities will follow the global trend. However, if we are to believe the Intergovernmental Panel on Climate Change (IPCC), urgent action is required in order to limit global temperature rise to two degrees. Canada can’t justify its reliance on the tar sands forever — are our post-secondary institutions ready to make the shift?
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