Issues Of The Environment: University Of Michigan Freezes New Investments In Fossil Fuels-Now What?
In an attempt to reduce its carbon footprint, the University of Michigan has pledged to freeze its investments in fossil fuel companies. This move has drawn praise from such activist groups as the U-M's Climate Action Movement (CAM). But it also says the school needs to go much further. CAM member and U-M doctoral student Noah Weaverdyck discusses it all with WEMU's David Fair on this week's "Issues of the Environment."
- The University of Michigan is freezing its investment in fossil fuel companies as it examines its investment policy, a step that local environmental activists have been pushing the university toward for years.
- U-M Regent Mark Bernstein announced the move during the regularly scheduled meeting last week, bringing thunderous applause as the decision was hailed by students, faculty, and community members.
- Activists at U-M, who have been lobbying the university for years to completely divest in companies linked to climate change, said the move was important, but the university needs to go further. "While this is a major victory for the fossil fuel divestment movement, it is only the first step," said a statement issued by the The Climate Action Movement at UM, a coalition of UM students, staff, faculty, alumni, and Ann Arbor community members.
- A protest calling or similar divestments at Harvard during the Harvard/Yale football game last fall delayed play by an hour and received national attention. It also illuminated a financial and governance issue: calls for divestment are forcing colleges and universities to navigate a difficult space between students' concerns and administrators' fiduciary duty to prudently manage endowments. It's a difficult spot because no firm consensus exists about whether fossil fuel divestment hurts endowment returns in higher education. One 2015 paper commissioned and funded by the Independent Petroleum Association of America estimated fossil fuel divestment could cost Harvard more than $100 million per year. On the other hand, a 2018 paper in the journal Ecological Economics examining divestment more broadly found fossil fuel stocks don’t outperform other stocks and don’t provide many benefits from a diversification standpoint.
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