& FURTHER READING
Q: What is divestment?
Q: How is divestment an effective tool?
A: The immediate goal of divestment is not to bankrupt companies of their money, but rather of their reputations. In this way, divestment is primarily a moral and social strategy. Taking a strong position against the industry and “putting our money where our mouth is” will amplify the message that fossil fuels are dangerous, and that investing in them is wrong. Put another way, cutting ties with fossil fuel companies strips them of their social license to operate.
Q: What is the history of divestment at Princeton University?
Q. What is the formal process for divestment at Princeton?
Q: What will change at Princeton once divestment happens?
A: While day-to-day operations will likely go unchanged, divestment will show that Princeton takes seriously its mission to reduce its greenhouse gas footprint, that it believes in the work of its faculty and scientists, and that it cares about the corporate missions of companies in which it invests. Over the long-term, this will help produce healthier research relationships and reinforce Princeton’s reputation as a forward-thinking university.
Q: Won’t Princeton lose money by divesting from fossil fuels? Won’t that reduce opportunities for learning?
A: Fossil fuels were extremely profitable in the past, but they’re increasingly becoming risky investments: Fossil fuels’ share of the global energy mix has been trending downward since 2010. Reports also show that clean energy investments are now competitive with fossil fuel, and that as a growing market, clean energy is the safer financial option. Backing renewable energy over fossil fuel means building a cleaner, fairer future, not profiteering from pollution.
Q: Princeton is also fighting climate change through its scientific research. Won’t divestment hurt these efforts?
A: Princeton’s world-class scientific research is undermined by the companies that fund it. For example, Princeton’s energy research program, the Andlinger Center, has received $6.7 million in renewable technology research funding from ExxonMobil, a company that pushes misinformation and lobbies the government to thwart the success of these same technologies. Princeton is less of a partner in these relationships than a tool for corporate greenwashing.
Q: Divestment is a political action. Surely the University should stay out of politics?
A: Princeton’s support for the fossil fuel industry is a political act in itself, given the industry’s rampant political lobbying and efforts to warp scientific consensus around the issue. Shell and ExxonMobil predicted the impacts of fossil fuels on climate change as far back as the 1980s, for instance, and in the years since have only extracted more. By investing in these companies, Princeton shields their harmful activities from scrutiny and lends legitimacy to an unsustainable status quo.
Q: Isn’t it hypocritical to divest from the fossils while continuing to use them for our energy needs?
A: The false choice between divestment and a working light switch is a typical rebuttal made by divestment skeptics. We argue Princeton can divest while reducing personal dependence on fossil fuels, and that it can use its endowment to develop alternatives that, if not now, will someday be available in New Jersey. As Environmental Humanities Professor Robert Nixon argues, “we should be doing everything to accelerate decarbonization in advance of it being feasible, and the first step in this is removing funds from the industry.”
Q: How do you know Princeton even has money invested in fossil fuels?
A: With $26 billion invested in all, it's probable the University supports these companies in some way. However, secrecy is a common defense against divestment movements, and Princeton does not disclose the nature of its investments. Whether or not it ever opens its books, we want Princeton to acknowledge that having these investments is reckless and immoral, and that it will not maintain such investments going forward.
Q: Don’t its investments in fossil fuels give Princeton influence in the industry? Can’t Princeton encourage sustainability by being an active shareholder?
A: Scientists say that in order to keep global warming below 2°C, we need to leave most of the world’s known fossil fuel reserves - including 90% of U.S. coal reserves - underground and unburned. This is an achievable goal, but it’s not the type of thing shareholders would vote for willingly. Make no mistake, Exxon would still be a profitable energy company if it transitioned to renewables, but it would only do so if forced by regulation or extreme social pressure. Princeton resists “position-taking” with its endowment funds, and is therefore unlikely to push these companies from within.
Q: Princeton is already fighting climate change with its Sustainability Action Plan. Why do we need divestment, too?
Q: Does divestment work?
A: Yes, but it depends on what we mean by “work.” Divestment works as a catalyst for social change: thirty-nine of the world’s top banks, including Morgan Stanley and France’s Crédit Agricole have stated they will no longer do business in coal. Divestment works as a financial lever: Peabody Energy, the U.S.’s largest coal company, cited divestment as a cause of its 2016 bankruptcy. Divestment, and reinvestment in clean energy, works to generate profit: BlackRock, the world’s largest asset manager, recently announced plans to divest from coal, stating its “investment conviction is that sustainability-integrated portfolios can provide better risk-adjusted returns to investors.”
The Guardian 8/4/20 Letter from economists: to rebuild our world, we must end the carbon economy
Dallas Morning New 7/31/20 ‘We’ve never seen a decline of this magnitude’: Oil giant Exxon reports $1 billion-plus quarterly loss
Reuters 7/27/20 Deutsche Bank tightens fossil fuel lending policies
Politico 7/20/20 Morgan Stanley commits to tallying its climate impact
Teen Vogue 7/15/20 Banks That Fund the Fossil Fuel Industry Don’t Deserve Your Business
Bloomberg 6/24/2020 Exxon, Koch hid climate change impact for decades, Minn. suit says
Washington Post 5/28/2020 ExxonMobil declines to set long-term climate goal, bucking oil industry trend
Washington Post 5/9/2020 Rockefeller heirs to Big Oil find dumping fossil fuels improved bottom line
The Guardian 4/30/20 Shell cuts dividend for first time since 1945 amid oil price collapse
OxfordStudent.com 4/20/2020 Oxford passes motion banning investment in all fossil fuels
CNBC 3/9/2020 Investors should sell stocks on any rumoured Opec deal
The Guardian 11/27/19 King coal no more as insurer Axa vows to divest from fossil fuel
The Guardian 10/14/2019 How do we rein in the fossil fuel industry?
The New Yorker 9/17/2019 Money Is the Oxygen on Which the Fire of Global Warming Burns
The Guardian 4/17/2019 The financial sector must be at the heart of tackling climate change
The New Yorker 9/14/18 The Divestment Movement to Combat Climate Change Is All Grown Up
Reuters 3/23/2016 Rockefeller Family Fund hits Exxon, divests from fossil fuels
Union of Concerned Scientists 7/8/2015 Former Exxon Employee Says Company Considered Climate Risks as Early as 1981