Have you ever wondered what our University invests in?
It’s unlikely you have – pretty boring question. The answer, however, is not so boring. Did you know that the university endowment fund is invested in arms, tobacco, and fossil fuels? A group of students across Exeter and Falmouth have been working together as Ethical Exeter to make the University’s investments more transparent and more responsible – here’s how they did it and what they’ve achieved so far.
Established in October 2015, Ethical Exeter emerged from the partnership of an existing Fossil Free campaign on the Falmouth campus with students at Streatham who were concerned about a lack of transparency in the University’s investments. Following a Freedom of Information request and correspondence with the University’s Chief Financial Officer Andrew Connolly, it was ascertained that Exeter’s £33.4 million endowment fund, currently managed through JP Morgan Chase, includes significant investments in arms, tobacco, and fossil fuels. “We felt that the silence on the subject and the lack of action to improve the University’s investment practices was unacceptable,” explains campaign organiser Natasha Yorke-Edgell, “and we decided that someone had to voice these issues.”
Ethical Exeter is asking the University to follow the example of other higher education institutions across the UK, including the universities of Glasgow, Warwick, and Sheffield, in fully divesting from fossil fuels. Additionally, it asks Exeter to go a step further than its peers by also divesting from arms and tobacco. “It is the purpose of a higher education institution to improve the futures of its students,” Yorke-Edgell argues, “therefore it is their duty to invest in a sustainable future for us all, which includes protecting people and the environment.”
Exeter’s £33.4 million endowment fund, currently managed through JP Morgan Chase, includes significant investments in arms, tobacco, and fossil fuels
The environmental organisation Fossil Free records over 500 institutions that have divested from fossil fuels to date, representing over £3.4 trillion in financial assets. Taking inspiration from the growing momentum of the divestment movement, the Ethical Exeter campaign is working with the University Council to develop a Socially Responsible Investment (SRI) policy which will potentially divest endowment funds from arms, tobacco, and fossil fuels, and re-invest in positive sectors such as renewable energy and sustainable farming.
The campaign has received support from notable academic and university staff, including Director of Climate Change Research Tim Lenton, Director of MSc programs in Sustainable Development Stuart Barr, and University Energy Manager Andy Seaman. The campaign has also received full Students’ Guild and FXU support and has been shortlisted for Campaign of the Year in the 2016 Guild Awards.
In one statement of endorsement, Exeter climate change researcher Professor Pierre Friedlingstein states that “the University of Exeter, as an academic institution, is increasingly investing in the areas of environment and climate change. However, when it comes to financial matters, the University is still investing in non-sustainable industries such as fossil fuel companies.”
“Maybe the time has come,” he suggests, “to align our near-term economical strategy with our long-term aspiration.”
In order to persuade the University of the case for ethical investment, the campaign has presented a report arguing its moral and financial validity to the University Council, highlighting existing contradictions between the University’s values and its practices. In 2007, the University Council published an Ethics Policy, which aims to provide the University at large with a framework with which to deliver “due consideration to the ethical, social and environmental issues arising from its activities.”
Part of this consideration, the document suggests, is the proper management of university investments in alignment with the Ethics Policy:
“The University does not intentionally invest directly (or through collective funds) in organisations with high exposure to activities or substances which are injurious to health, destabilise community cohesion, threaten international stability, or contribute to the development and maintenance of poverty, the abuse of children and the use of torture.”
However the University’s endowment fund, which is overseen by members of the University Council, currently has no policy that considers the SRI factors indicated above. At present, there are no stipulations governing what sectors the endowment fund is invested in and the fund is entrusted to JP Morgan Chase with the prerogative to maximise financial return.
“Maybe the time has come to align our near-term economical strategy with our long-term aspiration.”
So far, the Ethical Exeter campaign has held demonstrations in the forum as part of Fossil Free Friday and recorded 710 signatures on their online petition, aiming to reach 1,000 by the end of the academic year. The campaign team have also conducted extensive survey and focus group research into student, staff and alumni views on university investment issues, which has reflected a strong interest in transparency and support for divestment from arms, tobacco, and fossil fuels.
This research, alongside an ongoing dialogue with the Chief Financial Officer and Council members, contributed to the report that Ethical Exeter submitted to the University Council on April 14th. As a result of the year-long campaign, the formal report, and continued dialogues with key members of University management, the Ethical Exeter team have successfully secured a commitment from the Council to implement an SRI policy that guides their investment practices.
Going forwards, Ethical Exeter will continue working with the Council to develop divestment commitments in the three key sectors of arms, tobacco, and fossil fuels. Two members of the campaign team have been elected to sit on the Council subcommittee to draw up the SRI policy proposal, which will be presented to the Council at their meeting in October.
However, the campaign team urges students to keep supporting Ethical Exeter. “While the campaign has made significant headway,” Yorke-Edgell explains, “we expect the subcommittee negotiations to be just the beginning of a long campaigning process, every signature on the petition supports us in arguing for a more representative, more ethical, and more sustainable future for our university and its investments.”