http://www.nytimes.com/2014/05/07/education/stanford-to-purge-18-billion-endowment-of-coal-stock.html?_r=0
[If you own coal equity, it might be a good time to dump your stock
before Stanford and others do. The leveraging effect of dumping mutual
funds that hold coal stocks, as well as direct equity, could be huge.]
Stanford to Purge $18 Billion Endowment of Coal Stock
By MICHAEL WINESMAY 6, 2014
Stanford University announced Tuesday that it would divest its $18.7
billion endowment of stock in coal-mining companies, becoming the first
major university to lend support to a nationwide campaign to purge
endowments and pension funds of fossil fuel investments.
The university said it acted in accordance with internal guidelines that
allow its trustees to consider whether “corporate policies or practices
create substantial social injury” when choosing investments. Coal’s
status as a major source of carbon pollution linked to climate change
persuaded the trustees to remove companies “whose principal business is
coal” from their investment portfolio, the university said.
Stanford’s associate vice president for communications, Lisa Lapin, said
the decision covers about 100 companies worldwide that derive the
majority of their revenue from coal extraction. Not all of those
companies are in the university’s investment portfolio, whose structure
is private, she said. Over all, the university’s coal holdings are a
small fraction of its endowment.
“But a small percentage is still a substantial amount of money,” she added.
The trustees’ decision carries more symbolic than financial weight, but
it is a major victory for a rapidly growing student-led divestment
movement that is now active at roughly 300 universities.
At least 11 small universities have elected to remove fossil-fuel stocks
from their endowments, but none approaches Stanford’s prestige or
national influence. Tuesday’s decision seems likely to increase the
pressure on other major universities to follow suit.
Among other universities, Harvard has resisted student pressure for
divestment, and one student was arrested on Thursday after
pro-divestment activists blockaded the entrance to the school’s
administrative offices.
Stanford’s trustees acted after Fossil Free Stanford, the campus branch
of the movement, petitioned the board to re-evaluate the university’s
holdings in energy companies, Ms. Lapin said.
Yari Greaney, 20, a Fossil Free Stanford organizer, said the group was
“very proud of Stanford taking this leadership position.” Nationally,
leaders of the divestment movement praised the school for its decision.
As a global institution, Stanford “knows the havoc that climate change
creates around our planet,” Bill McKibben, the president and co-founder
of the environmental group 350.org, said in a statement. “Other
forward-looking and internationally minded institutions will follow, I’m
sure.”
Maura Cowley, the executive director of Energy Action Coalition, an
assemblage of groups active on climate change issues, called the
decision “a huge, huge victory.”
“Their decision, coming from such a major university and from such a
huge endowment, shows that the coal industry and other fossil fuel
industries are quickly becoming relics of the past,” she said in an
interview.
The trustees began studying divestment after Fossil Free Stanford
petitioned them to re-evaluate their holdings of energy companies. An
advisory panel that included students, faculty, staff and alumni spent
roughly five months studying the issue before recommending that coal
stocks be sold, Deborah DeCotis, the chairwoman of the board’s special
committee on investment responsibility, said in an interview.
Among other deciding factors, Ms. DeCotis said, the panel noted that
coal produces the most carbon per British thermal unit of any widely
used fossil fuel, that practical alternatives to burning coal are
available, and that the university was not dependent on coal or
coal-derived products.
Other fossil fuels did not meet some of those criteria, but “this is not
the ending point. It’s a process,” she said. “We’re a research
institute, and as the technology develops to make other forms of
alternative energy sources available, we will continue to review and
make decisions about things we should not be invested in. Don’t
interpret this as a pass on other things.”
Ms. Lapin said the school is already asking its investment advisers to
review endowment holdings and sell stocks of coal companies. The order
covers mutual funds with coal stocks as well as investments in
individual companies, she said.
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