University of Vermont trustees have decided not to divest from fossil fuels, officials announced Wednesday.
The University Board of Trustees’ Investment Subcommittee decided not to pass a proposal from the university’s Socially Responsible Investing Advisory Council to the Budget, Finance and Investment Committee for further consideration.
“The [investment] subcommittee stated that its primary duty is to invest the endowment to maximize returns, minimize risk, and provide funds to the academic mission of UVM,” according to a release from the university.
The university’s decision is the latest in a wide discussion at colleges and universities about investment in fossil fuels. Middlebury College recently decided not to divest from fossil fuel companies as well, and the UVM decision cited this case and others as part of its reasoning.
“The subcommittee observed that the university is certainly not alone in this investing approach,” it said. “Prestigious institutions with endowments much larger than UVM’s, including Harvard, Brown, and Middlebury, recently have cited similar themes that have informed their decisions not to divest from fossil fuel companies.”
The purpose of the university’s endowment, the release said, “does not include attempting to use the endowment as a tool in setting policy or exercising political influence.”
The subcommittee recognized, the release said, that the university has made a lot of progress toward “very real” concerns about climate change, including “nurturing a strong and expanding reputation as an environmentally focused institution, conducting cutting edge research in many relevant areas.”
The release also touted the university’s existing efforts towards recycling and energy efficiency.
Ultimately, though, the subcommittee’s message was that social and environmental concerns don’t play a role in the university’s investment decisions.
“The subcommittee was unanimous,” the release said, “in its view that the risks to diversification and investment returns from divestment cannot be assessed with sufficient accuracy and confidence, and that the downside risks have the potential to be significant.”
The subcommittee also said that “in its view, the most effective tool to influence corporate behavior is to use proxy voting,” an option that would not be available to the university if it divested from fossil fuel companies.
