Georgetown University is cutting coal from its $1.5 billion endowment, after its board of directors passed a resolution Thursday to cease all current and future direct investments.
The decision came after a more than yearlong conversation at the Washington, D.C.-based university, one largely prompted by students concerned with connecting the school’s Jesuit roots with the issue of climate change. It is the second U.S. Catholic college to divest from fossil fuels in some capacity, after the University of Dayton made the move last June.
The resolution, approved unanimously by the 39-member board, holds Georgetown from making or continuing any direct investments of its endowment in companies whose primary business is the mining of coal for use in energy production. According to the resolution, “an insubstantial portion” of the endowment is currently invested in such companies.
The university also pledged to encourage its external investment managers to avoid investments in coal companies, and to continue to explore questions of socially responsible investing and its relationship to the school’s mission and fiduciary responsibility.
"As a Catholic and Jesuit university, we are called to powerfully engage the world, human culture, and the environment -- bringing to bear the intellectual and spiritual resources that our community is built upon,” Georgetown President John J. DeGioia said in a statement.
“The work of understanding and responding to the demands of climate change is urgent and complex. It requires our most serious attention,” DeGioia continued. “As a university community, we can best respond to this evolving and ongoing challenge when we embrace the tensions embedded in this work -- and the variety of perspectives that are present -- as we seek an ever deeper understanding of how best to respond in ways that contribute to the common good.”
Dan Misleh, executive director of the Catholic Climate Covenant, told NCR that Georgetown’s decision to divest could spur action at fellow Catholic schools and institutions.
“I think more and more Catholic institutions will reconsider the path we're on regarding the burning of fossil fuels,” he said.
The conversation for divestment at Georgetown, like many similar campaigns on campuses nationwide, was prompted by a student group, Georgetown University Fossil Free, or GU Fossil Free, which formed in December 2012. In August, they formally proposed that the school divest over a three-year period from the top-200 oil, coal and gas companies based on carbon reserves.
In a statement Thursday, GU Fossil Free said of the board’s resolution, “this is not a victory,” adding that the decision to continue investments in oil and gas companies was “morally indefensible.”
Their proposal to pull Georgetown’s endowment out of the top-200 fossil fuel companies was initially rejected in January by the university’s Committee on Investments and Social Responsibility. Instead, the committee recommended partial divestment targeting energy companies, principally coal producers, with the worst environmental track records.
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According to the group, Georgetown’s direct investments in coal total less than 2 percent of the total endowment. Rachel Pugh, senior director of strategic communications, said the university does not disclose individual investments.
GU Fossil Free also took issue with the school’s decision to divest solely from direct investments in coal, as opposed to companies that might be part of mutual or commingled funds.
“If Georgetown understands coal investments to be immoral, the only reason not to divest from commingled funds which include coal would be because doing so is more logistically difficult than divesting from direct investments, a meager excuse considering the urgency of the climate crisis,” GU Fossil Free said in their statement.
Before the resolution vote, members and supporters of the group staged a sit-in Thursday morning at the Georgetown University Hotel and Conference Center. In March, three students disrupted a speech by Jim Yong Kim, World Bank Group president, by walking onstage and unfurling a banner with a pro-divestment message, and in February six members attempted to walk in on a meeting of the board.
The student group has maintained consistent conversation with the university administration throughout the process, last meeting with a seven-member working group of the board in early May. The university said GU Fossil Free has met with senior university officials more than a dozen times since November 2014.
Outside divestment, Georgetown has launched several initiatives aimed at achieving and promoting sustainability on campus. By 2014, the campus had cut its carbon footprint by more than 70 percent, beating by six years its goal of halving its carbon output by 2020. Last April, it began the Georgetown University Energy Prize, a two-year nationwide competition among U.S. towns which will award $5 million to one city based on its energy savings and innovative methods.
A year before Georgetown’s decision to divest, the board of trustees at the Marianist-founded University of Dayton, in Ohio, unanimously approved an investment policy to remove from its portfolio fossil fuel stocks in the top 200 firms with significant carbon reserves. The university estimated $34 million, or about 5 percent of its $670 million endowment, was held in fossil fuels.
A month earlier, Stanford University became, at the time, the most notable school to divest, pledging to cut the financial ties of its $18. 7 billion endowment (4th largest in U.S.) with the top 100 coal companies. Since then, Syracuse University (direct investments in fossil fuel-based companies) and the University of Maine (direct investments in coal companies) have also followed suit.
Georgetown’s $1.5 billion endowment does not crack the top 50 in the U.S., according to a list compiled by Boston College of endowment market values as of June 30, 2014. Harvard University, home of its own fierce, student-led divestment campaign, leads at $35.8 billion, with the University of Notre Dame ($8 billion) and Boston College ($2.1 billion) -- another site of a divestment push -- the only Catholic institutions in the top 50.
[Brian Roewe is an NCR staff writer. His email address is broewe@ncronline.org. Follow him on Twitter: @BrianRoewe.]
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