UVM has a long tradition of leadership in sustainability, through practice, education and research. Pictured is the Jericho Research Forest, one of the university's outdoor laboratories. (Photo: Josh Brown)
University’s Long Tradition of Environmental Leadership, Student Passion for Sustainability, Growing Climate Crisis, Were Key Factors in Decision
by Timothy McQuiston, Vermont Business Magazine University of Vermont President Suresh Garimella was succinct: "It's in our nature. It's what we do." Garimella, UVM president for exactly one year, was explaining his Board of Trustees' unanimous vote earlier on Tuesday to divest the university’s endowment of fossil fuel investments, adding another milestone in UVM’s long history of leadership on environmental issues.
The university will immediately end new direct investment in fossil fuels, will fully divest from public investments in fossil fuels by July 2023 and will allow pre-existing multi-year private investments, which it stopped acquiring in 2017, to lapse without renewal.
The total portfolio is valued at $536 million, with 6.7 percent (about $35 million) of that "touching" fossil fuel investments. Some of the direct investments are in stocks and others are commingled in funds.
Those direct investments represent the bulk of the fossil-related portfolio and can be quickly sold. Other equities and funds that are certified fossil-free will be added. There will still be some de minimus private investments that will take longer from which to divest. All should be completed by 2030.
The breakdown of those are investments are: About $14 million in public direct investments; about $13 million in multi-year private (non-publicly traded) investment funds; and about $8 million in commingled funds.
UVM will continue investing in opportunities that focus on sustainability, climate change mitigation, and other Environmental, Social and Governance, or ESG, issues. And it will accelerate an engagement campaign with managers of its commingled funds, asking that they factor the financial risks of climate change into their investment decision-making process and share their framework for doing so with UVM.
“Divesting from fossil fuels is the right thing to do for the University of Vermont, given our history and longstanding commitment to sustainability efforts,” said Suresh Garimella, president of the university. “As the climate crisis deepens, divestment—here and at other schools—is also the right thing to do for our environment and future generations. As we work to have a tangible effect on emissions, divesting brings attention to the global need for governments, organizations and individuals to aggressively confront the challenge of climate change.”
The board’s decision to divest came as the climate crisis is becoming increasingly more acute and after several years of student advocacy, which culminated in a series of presentations students and faculty made to the board in November 2019.
“The students put a great deal of work into making their case, and it showed,” said Ron Lumbra, chair of the UVM Board. “The Board appreciated the research they did and the effort they made to understand the complexity of this issue. Our subsequent review, which took into account financial trends and societal shifts, made today’s decision clear.”
In March, the university formed a Sustainability Work Group to explore divestment. The group sought input from the UVM community holding public meetings and receiving more than 420 submissions to its public comment period.
The group also studied the divestment actions of other schools and the university’s investment policy and worked closely with the board’s Investment Subcommittee.
Their recommendations formed the basis of the Board’s action on Tuesday.
Lumbra said that the university has a unique "brand" of environmentalism and sustainability, but the trustees also had to weigh their fiduciary responsibility and consider UVM's financial position.
But, he said, even in that regard, fossil fuel stocks are not performing at the same high level they previously were and trustees determined with the assistance of their financial advisers that investments related to new energy and sustainable products will perform better going forward than the old energy investments.
“Sustainability is integral to who we are as an institution,” said Trustee Carolyn Dwyer, who chaired the Board’s Sustainability Work Group. “We approached this recommendation—and the resulting decision—in a way that was methodical, principled, and built on strong foundational knowledge. I’m proud of the decision, and of the way we reached it.”
In a further reflection of UVM’s commitment to sustainability and environmental study, the Board also approved construction of a new hybrid-propulsion research vessel to enhance research within, above, and around Lake Champlain.
The research vessel, which will support the work of the Rubenstein School’s Ecosystem Science Laboratory, will be unlike any other used in freshwater research across the nation, and will support a diverse range of inquiry through its unique design and advanced technology. UVM’s primary research vessel, the Melosira, has been in service for more than 30 years.
UVM has been a sustainability leader in American higher education since 1972, when it launched the nation’s first cross-college program in environmental studies. Over the years, it continued to play a leadership role in sustainability-focused education, research and operations. Its programs cut across disciplines and encompass all aspects of the university from institutional commitments, academics, research and campus programs to transportation, facilities and investment. The social justice aspects of sustainability are a key element of many of the university’s programs.
- In 1973, UVM created the School of Natural Resources, which became the Rubenstein School of Environment and Natural Resources in 2003.
- In 2007, UVM became a charter member of American College & University Presidents’ Climate Commitment—now the Carbon Commitment—a high-visibility effort to address global climate disruption by committing to neutralize campus greenhouse gas emissions and accelerate research and education to restabilize the Earth’s climate. Since that time, we have expanded efforts to integrate sustainability studies into the curriculum, and source local renewable energy.
- UVM now offers sustainability-focused bachelor’s degrees (12), master’s degrees (5), doctoral programs (3), and graduate certificates (3). UVM is the first and only university in the country to offer undergraduate, master’s, and doctoral degrees in Food Systems addressing issues supply chain waste reduction and equitable distribution practices. The Grossman Sustainable Innovation MBA (SI-MBA) program is ranked the #1 Green MBA program by Princeton Review. Forty-five percent of UVM’s continuing education courses are sustainability-related and include a Campus Sustainability Leadership Professional Certificate, drawing sustainability professionals from across the country to access UVM’s best practices.
- The Gund Institute for Environment launched in 2017 to accelerate transdisciplinary environmental research at UVM; connect the University with leaders in government, business, and society; and develop real-world solutions to urgent global issues.
- Gund Fellows continue to be recognized for their contributions and leadership. This year, Aimée Classen, (Rubenstein School of Environment and Natural Resources/ RSENR), Taylor Ricketts (Gund director, RSENR), and Nicholas Gotelli (College of Arts and Sciences) were named Fellows of the Ecological Society of America (ESA) for outstanding contributions to the science of ecology. In 2018, when he was a Gund Fellow at RSENR, Nathan Sanders earned the same honor.
- In 2007, responding to student interest in clean energy, UVM created the Clean Energy Fund, raising $225,000 per year through a $10/student fee directed to energy education, research, and campus renewable energy projects. UVM was one of the first institutions in the country to create a substantial fund of this nature. Since 2008, the fund has invested over $1.5M on 40+ projects. The Clean Energy Fund also supports public lectures, internships, and energy-related planning processes.
- In 2013, UVM was one of the first public universities in the country to end bottled water sales, in response to student advocacy. A new dining contract in 2015 included specific sustainable and healthy beverage choices.
- Research related to the UN Sustainable Development Goals is conducted by 62% of all departments.
- The University reports every three years on sustainability in academics, research, co-curriculum, operations, policies, planning administration, and outreach. UVM has earned a Gold rating by STARS, the Sustainability Tracking, Assessment & Rating System, in its three successive reports (2014, 2017, and 2020). STARS is the primary means for tracking sustainability performance across the United States. Its metrics are constantly evolving to align with research and best practice.
For a more complete view of the University of Vermont’s commitment to sustainability, see https://www.uvm.edu/campaign/sustainability.
Source: UVM 7.14.2020