Students at over 200 high schools, colleges and university campuses across North America are demanding administrators take action on climate change by divesting institutional investments in fossil fuel companies. Divestment involves getting rid of stocks, bonds or investment funds considered unethical or morally ambiguous.
The students are part of the Fossil Free campaign, spearheaded by 350.org. The group views fossil fuel investments as a long-term risk to both investors and the planet. Fossil Free believes that the decision to invest or not invest in fossil fuel companies is driven not only by economic considerations, but also by moral and political values. The campaign demands that educational institutions take ethical action by freezing new fossil fuel investments immediately and fully divesting from fossil fuel companies within five years.
Two colleges, Unity College in Maine and Hampshire College in Massachusetts, have already begun the process of divesting their endowments from fossil fuel companies. The city of Seattle has also promised to remove fossil fuel investments from its pension funds.
Similar divestment campaigns appeared on university campuses in the 1980s, when an anti-apartheid student movement demanded that universities divest in companies that traded or had operations in South Africa. By the end of the decade, 155 American universities had divested and more than 80 cities and 19 counties had taken some form of binding economic action against companies connected to the apartheid regime.
However, according to a research paper published in the Journal of Business in 1999, financial valuations of both targeted companies and the South African financial markets were not affected. Divestment may have been effective in raising public awareness of apartheid, but this did not have major repercussions for financial markets. As such, divestment may be regarded as a strategy most effective for raising public awareness and shaping discourse around a particular issue, rather than for influencing financial markets.
Whether the Fossil Free campaign is able to leverage public discourse into measurable action on climate change remains to be seen; however, Fossil Free faces a difficult battle – one which has resulted in the failure of many previous awareness campaigns.
By Phil Oakley, [email protected]