Stanford University Rejects Fossil Fuel Divestment

AP Photo/Marcio Jose Sanchez
AP Photo/Marcio Jose Sanchez

Stanford’s Board of Trustees announced April 25 that the university endowment voted to refuse to divest its holdings in oil and gas companies, despite threats from students and some alumni.

The Stanford “Advisory Panel on Investment Responsibility and Licensing” (APIRL) not only refused to divest, but commented that “… at the present moment oil and gas remain integral components of the global economy, essential to the daily lives of billions of people in both developed and emerging economies.”

The “Fossil Free Stanford” movement, led by 348 students, had attempted to hijack the university by pledging earlier this year to withhold donations until Stanford divests from the fossil fuels industry. The groups’ website states: “We have united the Stanford community around a belief that profiting from fossil fuel companies is morally wrong. The fossil fuel industry is only a good investment if you bet on the destruction of our collective planet — and that’s not the kind of future we want Stanford invested in.”

In an effort to embarrass the number-one rated university in America, the student coalition threatened that for the first time in the school’s 130 year-old history, the 2016 graduating class intends to show its rejection of the university’s governance by refusing to give a “Senior Gift,” and as alumni to withhold all future donations until Stanford divests in what the students refer to as “climate chaos and environmental injustice.”

With the third-largest university endowment on the planet with about $22 billion in assets, Stanford’s divestment rejection follows similar actions by the $300 billion California Public Employees’ Retirement System (CalPERS) and the $7 billion University of California endowment.

Stanford’s Board of Trustees chastised the divestment movement by adding that fossil fuels have not only helped lift millions around the world out of poverty by providing cheap and easy access to energy, but energy companies have also been widely recognized for the critical role they play in reducing the U.S. carbon footprint through innovation, production and research.

The Board of Trustees added, “…some oil and gas companies are themselves working to advance alternative energy sources and develop other solutions to climate change …  given how integral oil and gas are to the global economy, the trustees do not believe that a credible case can be made for divesting from the fossil fuel industry …”.

The university emphasized that they are committed to environmental initiatives that have a tangible effect on climate change and the university’s carbon footprint, such as Stanford’s high-tech greenhouse gas-reducing energy system, off-campus solar plant and a cutting edge climate research center that addresses a range of environmental and sustainability challenges.

The, which opposes politically biased investment decisions, suggested that Stanford may have been influenced by a recent “study by CalTech professor Bradford Cornell that demonstrated that “divestment comes at a high cost for university endowments and has negligible influence on fossil fuel companies’ actual behavior.”


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