October 27, 2014
(A text of the remarks I made at the Faculty Association introducing the motion to call for a referendum on divesting the UBC endowment of fossil fuels. A more detailed rationale with extensive references can be found here)
Good morning everyone and it is so great to see you all here today. I’m especially grateful to see so many of the more than 190 faculty members who signed our open letter.
I’m George Hoberg, a professor in the Faculty of Forestry. I’ve been at UBC now for 27 years, the first 14 in the Department of Political Science, and the remainder in Forestry. My research is on environmental and natural resource policy, including energy and climate policy. Among other things I teach courses on sustainable energy policy to 150 undergraduates and 30 graduate students.
It’s as a result of these three things — my identity as a UBC faculty member, my research into the problem, and especially my teaching – that I’m here today to make a motion that UBC should divest its endowment of fossil fuels.
Last January, our students voted overwhelmingly, almost 4 to 1, to call on the university to divest. It’s time that UBC faculty join that call.
Academic researchers understand all too well that climate change presents an urgent crisis for humanity. The science is clear: the evidence is overwhelming that we are hurtling towards a future that is dangerous for humankind. Immediate actions are required to restructure our energy systems away from fossil fuels and toward clean energy. Luckily, research by engineers and economists also shows that such a transition is both technologically feasible and affordable.
Some are concerned that divestment might reduce the income UBC receives from its endowment, but this need not to be the case. Concern that divesting would hurt the performance of portfolios is not supported by the best available data. Studies designed to measure the impact of divestment have found little or no impact on returns. Indeed, there are increasing concerns, from the likes of the Governor of the Bank of England and major pension funds, that a “carbon bubble” could pose a significant threat to fossil fuel investments.
Just as UBC has undertaken renewal of its facilities and operations as a “living laboratory” for sustainability, we call on our university to apply its expertise and values with the same vigour to its endowment. UBC should devise a profitable fossil-free portfolio that inspires sustainable investing by other institutions.
Others argue that UBC should maintain ownership so that it can exercise leverage as a shareholder. However, because the business model of fossil fuel companies relies fundamentally on exploiting carbon reserves that humanity can’t afford to burn, working through shareholder channels is inadequate to achieve the transformative changes required. These urgent times demand rapid and significant changes in our energy system, and we believe those changes would be better fostered through the more dramatic action of divestment. Moreover, divestment rejects the dissembling tactics of the fossil fuel industry, including efforts to mislead the public about climate science and to delay the adoption of cost-effective policies that draw on social science research.
Given the extraordinary size of the fossil fuel industry and the nature of global capital markets, many argue that the divestment movement is largely symbolic. Divestment by a single investor, acting alone, cannot be expected to make a significant dent in addressing climate change. In fact, the very structure of the climate problem makes it a challenge to demonstrate that any particular action by an individual entity can be effective. The climate crisis is a global “tragedy of the commons,” created by millions of individuals and organizations around the world, all acting in their short term economic interests. Emission reduction by any individual, or even any country, cannot solve this immense collective action problem. To insist that any individual action or organization must be demonstrably effective accepts a logic that dooms the planet to dangerous climate change. If we continue to be guided by short term economic interests, humanity will simply be incapable of rising to the challenge.
In fact, the symbolism of the demand for divestment is what gives it power and makes it effective. The divestment movement is inspired by the anti-Apartheid movement of the 1980s. The impact of the anti-Apartheid investment campaign was less on the value of shares of companies doing business in South Africa than on how it altered the climate for economic and political relations with the racist South African regime. Fossil fuel divestment can play the same role in providing policy-makers the political space to take decisive actions to address the climate crisis.
There’s a strong scientific and economic justification for divestment, and research shows that divestment is unlikely to affect the financial performance of the endowment’s portfolio. But at the end of the day, the most important rationale for divestment is a moral one. It’s an opportunity to do what we can to address a shared problem with the resources we have at our disposal. When faced with daunting collective problems like climate change, people are often unwilling to act unless they are sure others are willing to do the same. To that end, divestment is, more than anything else, a signal to each other that we recognize the scope of the problem and we are willing to start taking actions to address it. As part of a rising global movement on divestment, UBC can show leadership by divesting, and inspire others to follow suit.
As teachers, we are reminded of our moral duty to future generations. We interact daily with today’s youth, who will suffer the greatest consequences should we fail to address the climate crisis. We believe that it is inconsistent with UBC’s core values of sustainability, global citizenship, and innovation to support an industry whose products are driving us toward an unsustainable future. And it is disturbing to us that our students’ education, an investment in their future, should be funded in part by profits from an industry that harms that same future. In his installation address, President Gupta said “Each generation has a responsibility to take the world as we find it and do our utmost to make it better.” UBC cannot live up to that promise when it is invested in an industry that poses a direct threat to the well-being of future generations, including our own students.
Divestment is an act of leadership. We are proud of UBC’s commitment to sustainability. We support the overwhelming call by our students for divestment from fossil fuels. The time has come for UBC to take the next step in living up to its ideals.