11 Oct Harvard Pivots on Fossil Fuels

Last month Harvard University disclosed that their funds would no longer invest in fossil fuels. That’s a nearly $42 billion endowment, shifting gears in the right direction.

As a New York times article noted ‘Harvard University has announced that it “does not intend” to make any future investments in fossil fuels and is winding down its legacy investments…’.

Referencing fossil fuel investments in an open letter on the University’s website, school president Larry Bacow stated, “Given the need to decarbonize the economy and our responsibility as fiduciaries to make long-term investment decisions that support our teaching and research mission, we do not believe such investments are prudent.”

There has been a long-running campaign to get Harvard to make the change which was celebrated as a victory by climate activists.

An early example of Impact Investing (Exclusionary screens)

The article notes that ‘The campaign for fossil fuel divestment at Harvard followed a playbook very similar to the one used in 1986, when Gay Seidman, a Harvard alumna who is now a sociologist at the University of Wisconsin-Madison, ran by petition on an anti-apartheid platform and was elected.’

Interestingly, the anti-apartheid movement was an early example of investing for impact. At least one fund in the early 1980s used what would be called an exclusionary screen by not investing in businesses that supported the economy of South Africa due to the country’s policy on apartheid.

Referenced Links

The New York times article published Sept 10th, 2021: Harvard Says It Will Not Invest in Fossil Fuels – The New York Times (nytimes.com)

The commentary on the decision from Divest Harvard: Tireless Organizing Yields Harvard Divestment Victory | by Divest Harvard | Sep, 2021 | Medium and the open letter posted by School President Lawrence Bacow:  Climate Change: Update on Harvard Action – Harvard University President.

This information is general in nature, is not a complete statement of all information necessary for making an investment decision, and is not a recommendation or a solicitation to buy or sell any security. Investments and strategies mentioned may not be suitable for all investors. Past performance may not be indicative of future results.

© Meredith D Sims 2021. Prepared by Heart Strong Wealth Planning.