Today the London School of Economics (LSE) has committed to divest its £97.2 million endowment from coal and tar sands companies and to not invest directly in any fossil fuel companies. LSE stressed the need for new fossil free financial products to be brought onto the market that meet the demand generated by divestment campaigns in the UK.
While recognising partial divestment from coal and tar sands as a step in the right direction, LSE Divest campaigners have expressed disappointment that the School will continue to indirectly invest in oil and gas companies.
Gabriel Davalos, an LSE alumni said: “Big oil is not part of a sustainable future. Oil companies like BP and Exxon show which side of history they are on when they fund climate sceptic politicians in the US. LSE should divest from all fossil fuel companies.”
Students, who occupied the university for 6 weeks in Spring, have now challenged the university to “stand by” research conducted by LSE’s Grantham Research Institute in 2013 which highlighted the substantial economic risks of continued investments in coal and oil and gas. Recent research by the Corporate Knights estimated that the LSE has already incurred a loss of about £2 million by not divesting when the LSE Divest campaign started 3 years ago.
Anna Koolstra, a student from LSE Divest, commented: “Our university has always been at the forefront of fuelling social change, most notably accepting student demands to divest from apartheid-era South-Africa. As a thought leader, it is LSE’s duty to stand by its research and send a strong message to decision-makers that we have to act on climate change now.”
A key aspect of today’s announcement, brought forward by the university’s Socially Responsible Investment Review Group and welcomed by campaigners, was the desire for LSE to play an active role in “spearheading collaboration” with “other Universities to encourage both passive and active fund managers to develop suitable new investment products – to send out a strong signal of the increasing demand for funds that invest in accordance with specified ethical and sustainability criteria.”
Andrew Taylor, Campaigns Manager at People & Planet said: “With eighteen UK universities now divesting, we need ways that these institutions can invest in the new low-carbon infrastructure which society desperately needs. Some local authority pension schemes are already investing directly in community controlled renewable energy, but we need to see ways that smaller institutions like universities can get involved.’
Eighteen UK universities have now made fossil free commitments including Oxford University, Glasgow University and Warwick University. Globally, more than 400 institutions and 2,000 individuals have pledged to divest $2.6 trillion from fossil fuels. These commitments have come from governments and investors from 43 countries, across multiple sectors including pension funds, health, education, philanthropy, faith, entertainment, climate justice and municipalities.