Should universities that promote themselves as pioneers of environment research put their investment portfolios where their mouths are?
Last month, it was revealed that the Australian National University (ANU) held shares worth over $80 million in at least eight fossil fuel companies. It took an FOI request from ANU students to bring this information to the public’s attention, after the university blocked attempts to publicise its investment portfolio and ANU Council discussions on investments in companies in coal, oil, or gas industries. See the documents here.
The ANU was privately investing in these companies at the same time that it publicly divested its shares – over $1 million of its $1.7 billion assets – in Metgasco, a coal seam gas company.
The ANU withdrew its shares in Metgasco in 2012, after an agreement with the ANU’s Investment Office and the Vice-Chancellor, Professor Ian Young, who acted on “concerns from various parties regarding perceived environmental impacts of coal seam gas mining,” according to an official statement.
Although ANU appeared to be cleaning up its investment portfolio, it was purchasing shares in Santos faster than it was divesting the Metgasco shares.
Fossil fuel companies that use coal, oil, and gas reserves have a recognised impact on the levels of carbon dioxide emitted into the atmosphere. Just last week, the Climate Commission warned that fossil fuels should be “left in the ground”.
Do universities, as institutions of higher learning, have a responsibility to invest in ethical companies? At the very least, should universities be transparent about their investment portfolios?
Home to the Climate Change Institute and the “ANUGreen” initiative promoting sustainability on campus, The ANU advertises itself as a “world class” institution which values research in climate change policy.
Young maintained that the ANU should be a “national leader, in terms of policy and research issues” at his first press conference in 2010, when it was first announced that he would take over from Ian Chubb as Vice-Chancellor.
Three years later Young has pursued a policy that is directly at odds with the university's stated environmental stance.
“The ANU itself thinks it has responsibility to lead on sustainability issues. Just look at all its commitments to being a sustainability 'role model',” Tom Swann, a member of Fossil Free ANU, who lodged the FOI request told NM. “Failing to take leadership will damage ANU's reputation, because it will get left behind. That's already starting to happen.”
This month, San Fransisco State University became the first public university to divest from coal and tar sands companies, with more divestments from other fossil fuel companies to come. Other universities in the U.S. have also announced that they will divest their endowments from fossil fuel companies, including Vermont’s Sterling College, and Hampshire College.
It’s not just universities that have taken this step. In Australia, the Uniting Church blacklisted mining and coal seam gas companies from its investment portfolio.
Swann thinks that universities should be transparent about their investments: “I see no reason why universities shouldn't disclose where they put our money. The ANU has been forced to do this, and really they should be publishing it proactively.”
“There is a general issue here: are universities public institutions expected to be open in their financial operations, or are they like corporations selling services on their own terms?”
Where do other Australian universities stand on ethical investment? When approached for comment, neither the University of Sydney nor Melbourne University told NM whether or not their endowment funds include shares in fossil fuel companies. However, both universities have environmental, social, and governance principles that are – in theory – applied by their investment managers.
The ANU has no such policy at present, although the ANU intends to roll out its first Socially Responsible Investment (SRI) Policy later this year.
“It is a new policy, one that will replace the informal ethical investment guidelines that have been in place for more than 20 years,” a university spokesperson said.
Swann sees this as a small victory for Fossil Free ANU, but emphasises that public input will be essential in making sure this SRI policy is more than mere lip-service. “We will be doing everything we can to make sure it knows the ANU community doesn't think it's 'socially responsible' for it to invest in fossil fuels," he said.