Of the University of Michigan’s nearly $10 billion endowment,
over $1 billion is invested in the fossil fuel industry. These investments are divided into various asset classes including stock, private equity, and liquid alternatives. The divestment campaign at UM, Divest and Invest
, calculated these investments from a Freedom of Information (FOIA) request filed in the fall of 2012. Initially, we discovered approximately $946 million invested in domestic and international companies such as Royal Dutch Shell, Gazprom, and British Petroleum. The carbon reserves held by these companies total approximately 284 billion tons, which is estimated to be more than half of the allowable carbon budget for limiting global temperatures to 2 degrees Celsius.
As our campaign became more organized during the spring we witnessed the UM Board of Regents approve ever more fossil fuel investments, ultimately pushing our total investments over the $1 billion mark.
In September, the organizing board of our campaign met up to discuss strategy for the upcoming year. We emerged from the strategy session with the shared sentiment that we will need to dig deeper than before to be successful. Last semester, we covered all the formalities of launching our campaign. We presented at a Regents meeting; met with individual Regents and the Investment Office; and importantly, we made a divestment a salient issue in student government elections, earning the endorsement of the Michigan Daily.
Unfortunately our efforts have been thwarted by an intransigent administration thus far. During a one on one meeting with a member of our campaign, one Regent made a comment along the lines of “[Divestment] get in line behind the other social justice causes lobbying for policy change on campus”.
Not to be dismayed, the organizing board of the Divest and Invest Campaign collectively brings years, if not decades, of organizing experience to the table. Additionally, two core members of the board spent their summers working almost exclusively on divestment. Marissa Solomon helped organize Power Shift with Energy Action Coalition
and Marion Berger spent her summer as a Fossil Free Fellow
. This past summer I had the opportunity to do an internship with Post Carbon Institute
(PCI). I assisted with the Energy Reality
Campaign in addition to helping out with Richard Heinberg’s latest book: Snake Oil
. I was afforded an upfront, critical assessment of our energy landscape while at PCI. The insight I gained has only been confirmed by events shaping the world around me. The other day, one of my roommates asked me for references regarding shale gas for an assignment. He had to write a policy memo to Governor Cuomo discussing the next steps for New York’s fracking moratorium. Should it be extended, or should New York ditch the moratorium? My roommate, an extremely bright fellow, was under the impression that New York, and the U.S. for that matter, sits upon centuries’ worth of natural gas that will propel us to the land of energy independence. I politely disagreed, and pointed him to the right pages in Snake Oil
that show how even the EIA is overestimating recoverable shale gas reserves.
And this made me wonder, why are more people not alarmed! My generation is surely in for a wild ride.
At Michigan we are readying our campaign to become more inclusive and strategic. In doing so, we have recently reprioritized our campaign goals. Our first ask is for the University to cease new investments in the fossil fuel industry. The University’s current strategy of active investment in the fossil fuel industry denotes complicity and indifference towards the consequences of climate change. Freezing new investments in oil, coal, and gas companies is thus a pragmatic first step that would align the University’s investment strategy with its sustainability goals.
Our second ask is for the University of Michigan to divest its stocks and bonds from the fossil fuel industry. These investments total less than $200 million, but importantly, could be reinvested in the short term. We believe the case for fossil fuel divestment meets the requirements outlined by the UM Investment Office. The industry is “uniquely responsible” for a moral and ethical problem – climate change - and additionally, the industry is “antithetical” to the core mission and values of the University.
How do we know this? Here’s text directly from the vision statement for the University:
We dedicate ourselves to ethical and responsible stewardship of financial, physical and environmental resources. We look for tools and strategies to create and enhance sustainable practices in all facets of operations and seek to lead in the global quest for a sustainable future.
The Divest and Invest Campaign at Michigan will further acknowledge the linkage between fossil fuel companies and environmental injustices resulting from extreme energy projects. For example, the University of Michigan owns more than 40,000 shares of Imperial Oil stock. This Exxon Mobil majority owned company is one of the key players extracting bitumen crude from the Athabasca Tar Sands in Alberta, Canada.
Because tar sands oil is considered an unconventional fossil fuel, the environmental impacts are extensive. From a climate perspective, former NASA climatologist James Hansen has likened tar sands oil to “burning coal in your automobile” and he refers to the proposed tar sands pipeline – the Keystone XL – as the “fuse to the biggest carbon bomb on the planet”. Alberta residents that live downstream from the Athabasca Tar Sands suffer from heightened cancer rates that include leukemia, lymphoma, and rare forms of stomach cancer.
Lead, mercury, and arsenic have all been discovered in the Athabasca River
My current role in the campaign at Michigan will be on the creative strategy committee. We’ve come to the realization that the financial aspect of divestment can be quite dry. To that end, I hope we can engage the student body in a more enthusiastic manner, while still retaining our professional image. Across the country we have witnessed divestment campaigns taking shape with varying degrees of success. I’ve been watching the Harvard campaign closely as they’ve been able to organize an impressive group of supporters, including over 500 alumni and 150 faculty signatures, respectively. And, kudos to San Francisco State University (SFSU) for being the first public university to begin the process of fossil fuel divestment. You have set the standard for public universities to follow!
Our campaign will invariably escalate its tactics in line with responses and reactions from the administration. Being a senior this year, it is a personal goal of mine that we can build some serious momentum on campus that will continue to grow. It is absolutely a matter of when, not if, the University of Michigan will take a serious look at its fossil fuel investments and consider the economic repercussions of heavily investing in a carbon bubble.