Students have revived a long fight against the University investing in fossil fuel companies. In the beginning of the spring semester, the environmental club EcoStudents and ASLMU formed a coalition called Divest LMU. The coalition aims to work with administration to develop a plan to divest from association with fossil fuels and encourage responsible investing, according to their Facebook page.
There has been a wave of divestment activism on campuses across the nation. On Feb. 6., Georgetown University announced the divestment of their endowment in fossil fuels within the next 10 years. This came after an eight-year campaign from the student-led group GU Fossil Free, according to Georgetown’s paper The Hoya. Georgetown was the second Jesuit university to pledge to divest, after Seattle University, according to the National Catholic Reporter.
The entire University of California system also decided to divest from fossil fuels in September of 2019.
Students and climate activists have been pushing for divestment from fossil fuels companies because of its environmental impact. Burning fossil fuels emits carbon and other greenhouse gases into the atmosphere, which contributes to the warming of the global temperature, according to the UN. Divest LMU also focuses on the social justice side of the issue, as oil waste affects indigenous communities and fossil fuel production sites are often built on indigenous lands, such as the Dakota Access Pipeline, according to NPR.
The money that is invested comes from the University’s endowment, which is made up of grants, student tuition and gifts, according to LMU. It is unknown what percentage of the endowment is invested in fossil fuels.
A portion of the University’s money that is invested in fossil fuels is in commingled funds. Commingled funds are assets from multiple accounts that have been combined into one. This makes divestment more difficult for the University, as it cannot pull out the money from fossil fuel involved companies only, according to ASLMU President Ken Cavanaugh.
Another of the administration’s concerns regarding the financial implications of divestment is endowment health. Cavanaugh says that the administration is worried that a change in investment would affect things like the University’s ability to provide scholarships.
Cavanaugh said that divestment will actually improve endowment health. This is because fossil fuel companies are considered “strand assets,” which means that they are likely to lose value as regulations increase. Investing in fossil fuels is therefore “very dangerous” in the long term, according to Cavanaugh.
“We have all these reasons that we should be divesting—moral reasons, economic, environmental, social. But we understand we’re not just directly invested in these companies,” said Reilly Grzywacz, a senior environmental studies major and the Divestment Chair of EcoStudents. “It’s really hard to just pull your money out … We just want to see the first step in the process. Which we haven’t.”
Divest LMU is currently working on getting 1,300 signatures by Friday, Feb. 28 so that the issue of divestment is presented on the ASLMU ballot. If on the ballot, the candidates for upcoming ASLMU positions can use this issue on their platforms when running. There is also a divestment demonstration scheduled for Mar. 4, at 12 p.m., according to Grzywacz.
Divestment activism has been around at LMU since 2013, when the club Fossil Free LMU was started. In 2016, they presented on divestment to the Senior Vice President, according to Cavanaugh. In 2017, LMU signed to the United Nations-supported Principles for Responsible Investing, which is a non-profit that aims to help investors to use responsible investment to increase returns while being environmentally and socially conscious, according to its website.
Soon after, the University created a Responsible Investing Advisory Committee (RIAC). The RIAC was implemented to advise the board of trustees on matters of investment. EcoStudents presented on divestment to the RIAC in March of 2019. The RIAC has not met since that Spring, according to Grzywacz.
“We’re hoping for more transparency and more communication between the administration and students. I think it was hard to take us seriously when it was so few of us, so we’re hoping with the coalition [the administration and students] will have more open conversations and be able to talk,” said Grzywacz.
In February, Cavanaugh wrote a letter to Chief Financial Officer Thomas Fleming urging him to meet with Cavanugh. They met shortly thereafter. According to Cavanaugh, LMU administration has been “very open” to discussing divestment.
Fleming said that through the RIAC and the UN Principles for Responsible Investing, LMU has “established a thoughtful and fair process to discuss, evaluate and become educated” on issues revolving investment of the University’s endowment. Fleming said they plan to continue to work with Divest LMU and will “ultimately make recommendations to university leaders and our Board of Trustees.”
Divestment has also been an issue discussed heavily within the Catholic community. In his 2015 encyclical, Pope Francis urged for immediate climate action. Since then, there have been numerous Catholic groups calling for environmental activism, including the Catholic Divestment Network.
Cavanaugh said that the ultimate goal of Divest LMU is to develop a full divestment plan by the end of the year.
“I have some fears about losing momentum, and having some of our most dedicated and experienced student activists graduate, so I’m going to do what I can to make sure we address those challenges to keep the divestment conversation alive and active,” said Cavanaugh.
Getting the administration on board by the end of the year is an ambitious timeline, according to Cavanaugh. Divest LMU hopes to use the momentum they have from their activism and other universities divesting to propel LMU forward toward divestment.