Policy can be an effective way to implement change, but climate change has been a recognized issue on the international political stage since the mid-1980s, and years of government discussion and planning hasn’t produced the solutions we need.
The United Nations Framework Convention on Climate Change was introduced in 1992 as an international tool to address climate change. Conferences such as the 1992 Kyoto Protocol and the 2015 Paris Agreement have produced documents outlining the policy changes and greenhouse gas (GHG) reductions targets required to avoid climate catastrophe.
No legal requirements for countries to uphold commitments are made at international climate conventions, which makes it difficult to implement potentially effective policies. As excessive fossil fuels continue to burn and carbon emissions continue to rise, many wonder if a top-down approach to climate action will ever be effective.
Failure of past government and intergovernmental commitments has led not only to frustration but also to mobilization of the public. Rather than relying on a top-down structure to make necessary changes, activists are now seeking change from the ground-up.
Smart policies and timely implementation are key factors in addressing climate change – the question is, can grassroots activism create or encourage the policy change needed?
The fossil fuel divestment movement is an example of the potential power of ground-up, grassroots activism. To date, 1,186 institutions globally have divested a total $14.14 trillion from the fossil fuel industry. The movement aims to create change through a bottom-up approach by encouraging governments and administrations to implement policy changes that ensure environmentally, socially and financially responsible operations.
At St. Thomas University, students have taken matters into their own hands by launching a fossil fuel divestment campaign. The Divest STU campaign is asking the university’s administration and investors to commit to divesting STU’s endowment fund from all holdings in fossil fuel companies within a two years.
Neighboring students at the University of New Brunswick are taking similar action. In 2019, the divestment campaign at UNB was re-launched after a short pause, and has made significant progress over the past year.
These universities lack consideration for the environment when it comes to its operations – that’s why students are requesting the implementation of ethical and responsible investment policies.
Divest STU is only one of many divestment campaigns occurring globally. A growing number of institutions are considering and committing to fossil fuel divestment, as it offers a window for effective policy change. Universities across Canada including the University of British Columbia, University of Victoria, Simon Fraser University, and the University of Northern British Columbia have been working on fossil fuel divestment campaigns for years.
The universities mentioned above, in partnership with the Pacific Institute for Climate Solutions (PICS), released a report in 2015 titled ‘Fossil Fuel Divestment: Reviewing Arguments, Implications & Policy Opportunities’. The report emphasizes the importance of progressive climate policy implementation, stating that top-down creation of policies is usually slow to unfold.
The report outlines recommended policy actions for provincial and municipal policymakers, universities and institutions, and divestment campaigns. One recommendation is to assess risk, something that STU administration and investors should do. Reviewing STU’s investments could reveal exposure to financial insecurity due to predicted unburnable carbon. Investors should consider making changes to invest in a long-term environmentally and financially responsible endowment.
Fossil fuel divestment campaigns can open a conversation about action on carbon emissions and the risk of continual investment. The report recommends that institutions issue a thorough review of sustainability goals and a timeline for when they will reach them. This would include revisions on how they screen investments to meet environmental, social and governance targets, in order to report a portfolio’s carbon intensity and exposure to unburnable carbon.
The University should review and revise its investment policy to reflect the institution’s desire to be a responsible global citizen. The policy should be updated to acknowledge the current state of the environment, and the future risks of investing in non-renewable energy sources. The investment policy should align with the environmental policy, to ensure the institution is following through on its commitments.
It could be argued that STU’s current investments in oil and gas companies do not align with the university’s commitments to “incorporate environmental considerations in all stages of the planning, design, and decision-making processes,” as found in STU’s Environmental Policy.
The university’s existing environmental policy has not been updated since 2016, therefore should be reviewed and updated before changes are made to the investment policy. This will ensure the University has a clear stance on their environmental commitments before revising the investment policy.
Updating STU’s investment policy to prohibit any new investments in coal, gas or oil projects could ensure that the University is held accountable for environmental commitments. As well, a tangible divestment timeline should be developed to provide a plan on proceeding after a commitment is made.
The university could propose a parallel, low-carbon or fossil-free endowment fund to create an opportunity for comparing returns. Working and engaging with students on this project could provide them with an opportunity to gain experience in alternative portfolio construction and investment screening.
While the direct impact of the divestment movement on fossil fuel companies may not be detrimental, the indirect impacts can be significant. It is important to recognize that divestment campaigns are generally a symbolic act which aim to shift social attitudes toward the fossil fuel industry. Policy can be influenced by change in social attitudes – when students advocate for their universities to divest, and show that the community supports the divestment campaign, administrations and investors are more likely to change policies to help them accomplish divestment from fossil fuels.
The University of British Columbia has an Endowment Responsible Investment Policy which includes a section on divestment. This section of the policy states that divestment or screening is an option that investors can act on, if an investment does not align with the environmental, social or governance practices of the university. The policy notes that the act of divesting may be more symbolic than effective, especially for relatively small investors such as UBC.
Successfully divesting from fossil fuels requires significant policy change and implementation at STU. Through ground-up student activism and consultation with administration and investors, there can be an open conversation about why divestment is a responsible decision environmentally and financially.
Accomplishing divestment doesn’t simply require agreement from administration – policies must be put in place to ensure the university upholds their commitment. Policy changes include: analysis of the risks of fossil fuel investments, mission-aligned policies which respect the university’s environmental and social commitments, introduction of a timeline and plan to meet commitments, and introducing a low-carbon fund to assess productivity of green investments.
Divestment can be an effective way of approaching policy change. Ground-up activism and a shift in social attitudes can influence policy and generate the sustainable change that we need.
Hannah Moore is a fourth year Environment & Society major at St. Thomas University, the leader of the STU divestment campaign and a researcher on the RAVEN project at the University of New Brunswick.
