Fossil Free Gonzaga Resolution
We request that Gonzaga University’s Board of Trustees commit by 2020 to divest Gonzaga’s endowment from the current 200 most carbon-intensive companies. Doing so will formally recognize the reality and urgency of the climate crisis and show fidelity to our Jesuit, Catholic, humanistic mission and to our endowment Investment Policy and Guidelines.
The Gonzaga Student Government Association (GSBA) Senate voted in favor of this resolution on May 1, 2017. See the press release here. The Faculty Senate is due to consider the resolution in the fall of 2017.
- Science and the Climate Crisis
- The Financial Argument for Fossil Fuel Divestment
- The Moral Argument for Fossil Fuel Divestment
- Replies to Likely Concerns
- Divestment Resolution and Faculty Signatures
The idea of Gonzaga divesting from fossil fuels should not be controversial, if we are to live up to our charge of reflecting our institutional mission and identity as a Catholic, Jesuit, humanistic university. Indeed, morally, it is indefensible for a Jesuit institution to seek to profit from the harm of creation and the vulnerable. This message was communicated unequivocally, on a broader scale, by Pope Francis, in his recent Papal Encyclical Laudato Si’, “On Care for Our Common Home.”
Beyond our own intellectual and spiritual traditions, the argument for divestment is similarly compelling. In December of 2015, for example, the nations of the world came together in Paris and agreed for the first time to limit global temperature increase “well below” 2°C (3.6°F) beyond pre-industrial levels. This “guardrail” is needed in order to avoid catastrophic global warming, which could cause massive species extinction, ocean acidification, and dangerous sea level rise that could displace many millions of people, especially the poor. Additional to the moral considerations of divestment are the financial: fossil fuels are no longer sound investments. According to current scientific consensus, if we are to avoid climate disruption that could cause potentially catastrophic harm to human and non-human life, more than 80% of known fossil fuel reserves must not be brought to market. As the precedent of Gonzaga’s South African divestment in the Apartheid era demonstrates, and as our own Environmental, Social, and Governance (ESG) considerations affirm, we must consider whether our investments are consistent with our values. We agree with the students of the Fossil Free Gonzaga campaign, the time is now for Gonzaga to take action and move toward divestment of fossil fuel investments.
Science and the Climate Crisis
According to the Intergovernmental Panel on Climate Change (IPCC), the largest and most authoritative scientific body on the climate, human emission of greenhouse gases “are extremely likely [>95% likelihood] to have been the dominant cause of the observed warming since the mid-20th century.” Indeed, more than 97% of the scientific literature confirms that (1) the planet is warming and (2) human-caused greenhouse gas emissions are the primary cause.
The Financial Argument for Fossil Fuel Divestment
The Paris Agreement sends a clear “signal” to the marketplace and to nations that significantly alters the financial risk associated with fossil fuel investment. These conditions are now creating a “carbon bubble.” Further, if we are to avoid catastrophic climate disruption, more than 80% of known fossil fuel reserves must not be brought to market. These reserves are then at risk of becoming “stranded assets.” On the other hand, if in a misguided and selfish attempt to profit from the creation of global warming, currently accessible fossil fuel reserves are extracted and sold, releasing the carbon that they currently trap, then more than 6°C (10.8°F) warming could be expected this century. One way to conceive of the magnitude of these possible changes to the global surface temperature is to liken it to your body’s core temperature. An increase of 3.6°F brings your core temperature to 102.2°F. You would feel terrible and would certainly seek medical treatment. On the other hand, a 10.8°F (6°C) increase of core body temperature to 109.4°F would be truly life threatening. The same is true for the climate. Thus, if catastrophic climate change is to be averted, the vast majority of fossil fuel assets must not be realized, making them unsound vehicles for investment.
Finally, beyond the financial risk of stranded assets and the carbon bubble, there is strong evidence to suggest that institutions that divest can do well financially. Indeed, there is evidence that the returns from a socially responsible portfolio need not be lower than those of other portfolios. Thus, the prudent financial decision is to avoid risky, carbon-intensive investments. In a world committed to creating a low-carbon economy, fossil fuels are a poor investment.
The Moral Argument for Fossil Fuel Divestment
The primary argument in favor of investing our endowment in carbon-intensive companies is that doing so will yield the highest return, allowing the university’s educational mission to be maintained and strengthened. The financial argument for divestment concludes that there is weak financial motivation to invest in carbon-intensive companies. But are carbon-intensive investments compatible with Gonzaga’s mission? We are proud that Gonzaga University has a robust Investment Policy for the endowment that includes Environmental, Social, and Governance (ESG) considerations: “In keeping with the Mission Statement of Gonzaga University, it is the intention of this Investment Policy to promote the basic moral values of fairness, respect for human life, defense of human rights and social justice.” It is right that Gonzaga should “exclude from the Fund, securities of firms or managers whose policies or practices are inimical to the values the University espouses.” Seeking to profit from the sale of the fossil fuels that are creating catastrophic climate change is fundamentally inimical to the values the University espouses, especially concerns for the poor, social justice, and “care for the planet,” as our mission statement puts it. We find a precedent in Gonzaga’s past decision to divest from companies doing business in South Africa. This divestment was a protest against the injustices of apartheid. Today, the burning of fossil fuels creates systemic injustices. Divestment of carbon-intensive companies is a similar protest against the harms to the most vulnerable created by climate change.
Since Saint John Paul II’s 1990 World Peace Day speech, “The Ecological Crisis: A Common Responsibility,” the Catholic Church has consistently argued that environmental degradation is not merely an economic or technical problem to be managed; “the ecological crisis is a moral issue.” Pope Francis greatly expanded on this sentiment in his recent Papal Encyclical Laudato Si’. As he notes, no one is exempt from the effects of a global climate changed by warming of the atmosphere, but the effects of climate change will disproportionately harm the poor. This is a grave injustice, for the poor are least responsible for having caused the problem, received very little of the wealth derived from its creation, and have the fewest resources to adapt. On the other hand, Pope Francis notes, “Many of those who possess more resources and economic or political power seem mostly to be concerned with masking the problems or concealing their symptoms, simply making efforts to reduce some of the negative impacts of climate change” (21, 26).
As you know, justice and solidarity with the poor is particularly distinctive of our own Jesuit charism. As stated in General Congregation 35, part of the Society of Jesus’s mission is to respond to ecological or environmental challenges, — “to appreciate more deeply our covenant with creation” (D 3, 36). The care of the environment “touches the core of our faith in and love for God” (D 3, 3). While the financial argument may be open to disagreement among experts, the moral argument is unambiguous and compelling. To continue to invest our endowment in carbon-intensive companies is to seek intentionally to profit from the systemic destruction of creation and the unjust harm of the world’s poorest and most vulnerable. In short, continued investment in the fossil fuel industry is immoral. We should follow the brave example set by the Board of Trustees of Dayton University, who unanimously voted to divest their $670 million endowment of fossil fuels.
Objections and Replies to Fossil Fuel Divestment
Shareholder activism instead? Some may suggest that instead of divesting from fossil fuels Gonzaga should engage in shareholder activism to affect the behavior of these industries. This is rightly included as a strategy in Gonzaga’s own ESG considerations, which state that the Board may choose to “influence the social behavior of firms invested in through the exercise of ownership rights.” However, the need for shareholder activism does not obviate the compelling moral and financial arguments provided above. Seeking to profit from the harm of the poor and the destruction of creation is “inimical to the values the University espouses.”
Hypocrisy? Some may claim that divestment is hypocritical when we still rely so heavily on fossil fuel infrastructure. Though understandable, this reasoning is mistaken. The real concern of hypocrisy should be claiming concern for justice and care of creation while continuing to seek to profit from the sale of fossil fuels.
Let fossil fuels companies lead the way? Some may claim that instead of divesting from carbon-intensive fossil fuel companies we should continue or even increase investment in them because, as energy companies, they are best situated to lead the transition to renewable, low-carbon forms of energy. In principle, this is true. In fact, most fossil fuel companies have steadfastly fought against attempts to transition away from fossil fuels and to renewables, the most dramatic example being ExxonMobile.
Politicking? Some may rightly be concerned that fossil fuel divestment could appear to position the University as a political actor rather than an educational institution. For instance, this is the concern of the president of Harvard University, Drew Faust. While an understandable concern, Gonzaga’s Jesuit character does not make such supposed neutrality an option. As the precedent of Gonzaga’s South African divestment demonstrates and our own ESG considerations affirm, we must consider whether our investments are consistent with our values. Though South African divestment may have been politically charged in the 70s and 80s, Gonzaga’s Board of Trustees was right to conclude that profiting from the injustices of apartheid was morally wrong. If the case of South African divestment was compelling, the case for fossil fuels divestment is even more urgent: millions of the most vulnerable lives are at stake.
By way of conclusion we quote a passage from Pope Francis’s comments upon arriving in America in September 2015. We must have the courage to take up the challenge he poses.
Accepting the urgency, it seems clear to me also that climate change is a problem which can no longer be left to a future generation. When it comes to the care of our “common home”, we are living at a critical moment of history. We still have time to make the changes needed to bring about “a sustainable and integral development, for we know that things can change” (Laudato Si’, 13). Such change demands on our part a serious and responsible recognition not only of the kind of world we may be leaving to our children, but also to the millions of people living under a system which has overlooked them. Our common home has been part of this group of the excluded which cries out to heaven and which today powerfully strikes our homes, our cities and our societies. To use a telling phrase of the Reverend Martin Luther King, we can say that we have defaulted on a promissory note and now is the time to honor it.
The following faculty are in support of this divestment resolution http://tinyurl.com/jocgnr2.
Consult the timeline of the Fossil Free Gonzaga campaign.