Letter to the editor

EDITOR’S NOTE: The UB Foundation has not released its list of current investments and, when asked Wednesday, did not comment on if it is investing in fossil fuels. UBF Executive Director Ed Schneider wrote in a statement that UBF does not comment on “specific investments in its portfolio.” This letter was not edited for grammar. 

The scientific consensus that human activity drives climate change is one that is only seriously contested in the arena of politics. Fortunately, the debate has essentially already been won in terms of America’s younger population. According to ​cbsnews.com​ ​70% of Americans between the age of 18 to 29 already view climate change as a serious problem or crisis and even a 52% majority of Millennial and Generation Z Republicans think that the government is not doing enough to battle climate change per ​Pew research​. The question that we as young people face then is not whether or not we accept climate change to be real, but rather how exactly we should go about preventing its progress and mitigating its effects. A rather simple first step in preventing its progress is to stop investing in the fossil fuels that contribute to climate change. Unfortunately, our University has failed to take the necessary action to achieve this basic first step. 

For years, millions of dollars in university funds have been spent on fossil fuel investments. These investments include holdings in crude oil, natural gas, and fracking firms as reported by watchdog group​ ​littlesis.org.​ Some of these investments include private equity firms such as Encap Flatrock Midstream which financially supports smaller crude oil companies to grow their operations per reporting by the ​Investigative Post​. This means that our University’s money has been spent to support the growth of new crude oil operations. It would be unethical enough if our University’s money was simply being invested in established oil operations, but to financially back the creation and growth of new oil operations makes UB directly responsible for the new carbon emissions those operations produce. We are not simply profiting off of an industry that contributes to climate change, we are directly accelerating the process of climate change itself. This raises an obvious question: how can a university that is so ostensibly dedicated to sustainability also financially support a process that directly threatens environmental sustainability? UB does this by having a private organization known as the UB Foundation invest and manage our endowment. The Foundation is an independent organization that has its own separate Board of Directors and Trustees that determine how our university’s funds are managed. 

One would imagine that the University would have some sort of way to keep the Foundation accountable for how it handles our 800 million dollar endowment. In theory, the University does have methods to keep the UB Foundation’s actions in line with the University’s values. There are four people in UB’s current administration, including Provost A. Scott Weber, that are non voting members on the Foundation’s board. These administrators have the ability to make the Foundation’s board of directors take our University’s values into consideration when making financial decisions such as which industries to invest in. The University also has an avenue to hold the Foundation accountable to our values through President Tripathi’s position as a voting member of the Foundation’s executive committee. Despite this, the Foundation has continued to ignore, or perhaps even remain ignorant of, our University’s dedication to sustainability. Given that in 2017, UB’s Faculty senate, Undergraduate Student Association, and Graduate Association all passed a resolution urging the UB Foundation to divest from fossil fuels, it seems much more likely that the Foundation has just decided to ignore the values of the students and faculty of the university that it is supposed to be supporting. 

An understandable counter-argument to divestment that is often iterated is that an organization such as the UB Foundation ought to be primarily concerned with profit even at the expense of environmental consideration. Even if the premise of this argument, that profit maximization ought to take priority over UB’s commitment to sustainability and concerns for the environment, is accepted then this argument still does not hold water because of the simple fact that environmental considerations do not hinder performance of investment portfolios. The most poignant example of this is the MSCI KLD 400 Social Index. This financial index includes 400 US securities meant to be a weighted fair comparison of the S&P 500 with the caveat that the MSCI excludes companies “whose products may have negative social or environmental impacts” (​msci)​ . It’s no surprise that this index contains no investments in the Fossil Fuel industry. However, it may be surprising to some that the MSCI KLD 400 Social Index has actuall outperformed the S&P 500 for the last 25 years. From 1990 to 2016 the S&P 500 averaged an annual return rate of 9.45% while the MSCI averaged a rate of 9.82% in annual returns. This, coupled with the fact that 20% of professionally managed investments in the United States currently follows Socially Responsible Investment standards according to the ​ussif​, goes to show that refusing to invest in environmentally harmful industries such as the fossil fuel industry does not mean sacrificing investment portfolio performance. 

In truth, the reason that the UB Foundation doesn’t divest from fossil fuels is simply because it's easier not to. It’s easy to ignore the opinions of students, it's easy to ignore resolutions from on-campus organizations, it’s easy for the Foundation’s executive director Edward Schneider to say the Foundation is “actively looking at our policies governing investments in general, including fossil fuels” (​IP​) ​and then do nothing in two years to meaningfully fix those policies. 

We hope that the Foundation has learned from our most recent actions that ignoring us will no longer be easy. Divestment is a nation wide movement that will only continue to grow in UB as more students become informed. It will no longer be easy to invest in an industry that regularly and actively lobbies all levels of government to not take meaningful steps to combat climate change. It will no longer be easy for UB’s Administration to be deafeningly silent on the Foundation’s investments. Most importantly, it will no longer be easy for the UB Foundation to disregard the values of students and faculty.