Divestment means getting rid of all stocks in a particular company or industry for a political reason. Divestment campaigns are a serious approach to disrupting the cycle of a crisis. For example, the movement to divest from companies tied to the government of Sudan ignited because traditional political channels failed to stop the genocide in Darfur. The fossil fuel industry brazenly destroys communities, poisons our air and water, contributes to the global climate crisis, and has entangled itself in our political system. This has led us to a crisis point that must be addressed using all the tools and resources we have. Divestment is one of these approaches and can shift the dialogue in both the financial and policy arenas.
In asking for divestment, we are implicitly stating that investment is a choice. It is a political choice with global consequences. Choosing to invest in an industry means financially endorsing that industry’s practices. Wellesley College states in the Mission section of the website, “The College considers sustainability as a factor in all institutional decisions.” We are calling on Wellesley to consider sustainability (both our long term financial sustainability & the sustainability of our Earth) in regards to our endowment. Greening our investments is more than a symbolic gesture. It is a concrete display of our commitment to fostering healthy communities and environments.
Will divestment damage our college financially and/or divert funds from financial aid?
Divestment does NOT have to cost Wellesley College any money. In fact, divestment may affect our investments positively.
Additionally, when returns have fallen in the past (for whatever reason) Wellesley has fiercely protected financial aid: this prioritization would persist in the event that fossil-fuel divestment negatively impacted Wellesley’s returns. And besides, most financial aid money comes from fundraising rather than the endowment (which is largely channeled into operating costs).
Can divestment on behalf of a handful of institutions really make a difference?
While it’s fair to say that divestment from a small number of colleges or civic bodies would hardly make a noticeable financial difference to fossil fuel companies, the value of divestment spans beyond economic pressure. Divestment sends a clear symbolic message to fossil fuel companies about consumers’ moral values — a message which is greatly strengthened by the momentum divestment is gaining as you read this. And while it may not make a difference to them, it will make a difference to us. It is never morally justifiable to profit off of the destruction of our planet.
Why divest from direct holdings when our college is so dependent on the fossil fuel industry in other ways?
The climate crisis is a complex issue that must be addressed through from all angles. Campus sustainability initiatives and fossil fuel divestment are not mutually exclusive actions: they go hand in hand. Both our resource use on campus and Wellesley’s financial strategies should align with the College’s purported emphasis on environmental sustainability and social justice.
What are the options for greener investments?
Fossil Free Wellesley is not making specific investment proposals to the Board of Trustees. We recognize that the Board is skilled at making strategic decisions regarding the institution’s financial success. However, we want to demonstrate that there are viable and profitable options for Wellesley that do not jeopardize our climate and our future. Wellesley currently has both direct holdings and commingled funds that include investments in fossil fuels. Commingled funds are a type of mutual fund that consists of assets from several different accounts blended together and bought in by several different investors. Because it is a set portfolio, Wellesley cannot remove one specific investment from the fund. However, Wellesley can withdraw itself and reinvest in funds that do not contain fossil fuel investments. There are many options available including:
Green Century Balanced Fund: a mutual fund that does not invest in fossil fuel companies. It has three stars from MorningStar, indicating a fair market value.
Portfolio 21 Investments: this investment company has a policy of not investing in fossil fuels. They write, “we do not own these stocks because our research tells us that these companies pose too much risk to the environment and society, and that they face too much risk based on their business operation profile.” MorningStar gives them a 3-star rating as well, indicating a fair market value.
Pax World Investments: has mutual funds that do not invest in fossil fuel company and, in general, they “avoid investment in any company whose primary business is coal mining and production.”
Where has this campaign been successful?
Sterling College (VT), Unity College (ME), Green Mountain College (VT), College of the Atlantic (ME), Hampshire College (MA), and San Francisco State University have all committed to divestment. And they’re in good company — commitments to divest are in place for 18 US cities (including Providence, R.I., and Seattle, W.A.), two US counties, 13 religious institutions, and five other institutions.