Stanford University has announced that it will divest its $18.7 billion endowment of coal mining companies, becoming the first major university to align itself, at least in part, with a national movement aimed at pressuring endowments and pension funds to rid themselves of all investments in fossil fuels.
In response to a divestment recommendation issued by a panel comprised of students, faculty, staff, and alumni, the Stanford board of trustees on Tuesday announced that the university will no longer invest directly in publicly traded companies for which coal extraction is the primary business, will divest itself of its holdings in any of the approximately hundred-such companies, and will recommend that its external investment managers also avoid investing in those companies. Lisa Lapin, associate vice president for communications at Stanford, told the New York Times that while the university's coal holdings are a small fraction of its endowment, "a small percentage is still a substantial amount of money."
The board's decision came in response to a campaign mounted by Fossil Free Stanford, a student-led organization that, as part of a broader national campaign, petitioned the university in 2013 to divest from two hundred fossil-fuel extraction companies. In taking the action it did, the board concurred with the university's Advisory Panel on Investment Responsibility and Licensing that divesting from coal is consistent with Stanford's policy of allowing trustees to take into consideration "corporate policies or practices [that] create substantial social injury" when making investment decisions. While coal produces the most carbon per unit of energy generated, the move also reflects the fact that practical alternatives are available. "This is not the ending point. It's a process," Lapin told the Times. "We're a research institute, and as the technology develops to make other forms of alternative energy sources available, we will continue to review and make decisions about things we should not be invested in."
"Stanford has a responsibility as a global citizen to promote sustainability for our planet, and we work intensively to do so through our research, our educational programs, and our campus operations," said Stanford University president John Hennessy. "The university's review has concluded that coal is one of the most carbon-intensive methods of energy generation and that other sources can be readily substituted for it. Moving away from coal in the investment context is a small, but constructive, step while work continues, at Stanford and elsewhere, to develop broadly viable sustainable energy solutions for the future."
While at least eleven small universities have decided to divest their endowments of fossil fuel stocks, none approaches Stanford in terms of size, prestige, or national influence, the Times reports.
As a global institution, Stanford "knows the havoc that climate change creates around our planet," Bill McKibben, president and co-founder of the environmental group 350.org, said in a statement. "Other forward-looking and internationally minded institutions will follow, I'm sure."