“Know the true value of time; snatch, seize, and enjoy every moment of it,” urged the Earl of Chesterfield in a letter of advice to his son penned in 1749. “No idleness, no laziness, no procrastination: never put off till tomorrow what you can do today.” This has not tended to be the view of university governors the world over, notably in the field of ethical investments. The elite heavy weights have shown their flabbiness in the area, dragging in their approach to matters of environment and the climate. Money is just that; where it goes, in terms of investment, is of little moral consequence, lacking smell and ethical baggage. Industry is there to be, and here, the word is essential, engaged.
Harvard University, one of the wealthiest teaching and research institutions on the planet with an endowment of $41 billion, is something of a specialist in this. In 2013, the university’s President Drew Gilpin Faust adopted the position of “engagement over withdrawal” on the subject of fossil fuel divestments. At the time, Faust considered any full divestment measure as unwarranted and unwise: the endowment fund was to be seen in purely self-beneficial terms, “a resource, not an instrument to impel social or political change.”
Playing the fiddle of an amoral politician, Faust attempted different measures of dismissiveness and reassurance: climate change did pose “a serious threat to our future – and increasingly our present”, and the university would be incorporating “environmental, social and governance” into its investments, thereby aligning with “investors’ fiduciary duties”. Such an approach guaranteed an indefinite series of postponements on the matter.
By April 2017, the Harvard Management Company, the entity responsible for managing the finances of the corporation, felt that some move was required. Colin Butterfield, heading the natural resources section at the HMC, accepted that climate change was a “huge problem” and that a “pause” in fossil fuel investments would take place. Slyly, Butterfield shifted the focus, distinguishing between direct and indirect investments in the industry. “What I can tell you is, from my area, I could honestly say that I doubt – I can’t say never, because never say never – but I doubt that we would ever make a direct investment with fossil fuels.”
In 2019, Harvard’s new broom, Lawrence Bacow still preferred “engaging with industry”. In a surprise appearance at a forum hosted by Divest Harvard and the Harvard Political Union in April that year, he have gave a model lesson on intellectual skiving: Teach, research and convince, and the industry itself will change. Till that was done, the fossil fuel matter could be postponed. “We need to engage with those whose behaviour we need to change. We need to engage with industry. We do that through scholarship; we do that through our teaching.”
Donning his weighty business hat, Bacow played the role of cold realist, warning against any policy coitus interruptus. Divesting from fossil fuels was not the same as tobacco, where a full-scale enterprise of withdrawal through the university from research to labs could be implemented. “The day after, if we were to divest, we’re going to turn on the lights. We would still be dependent on fossil fuels.”
It has been a long, acrimonious battle. The Harvard President and Fellows have tended to swat the claims away, regarding them as callow and unrealistic. The students, in turn, have sought to have their case taken seriously, engaging in their own little bit of climate change lawfare. In 2014, a lawsuit was lodged in Suffolk County Superior Court in Massachusetts, featuring an 11-page complaint and 167 pages of supporting exhibits asking the court to force divestment on the students’ behalf. The measure failed at first instance and on appeal, though campaign managed, along the way, to gather support from the Animal Legal Defense Fund, climate change scientist James Hansen and the Cambridge City Council.
The central problem in such climate change litigation remains one of conviction. Courts refuse to cast a distant eye upon the future, expecting evidence to be as immediate, clear and incontestable as possible. The argument by the students was precisely one of current action to prevent environmental dystopia, a case for future, potentially imperilled generations. Instead, the students failed to show they had legal standing to challenge fossil fuel investments for their negative impacts on academic freedom and education at Harvard. Their interests were “widely shared” with thousands of their peers at Harvard; their connection with the subject matter was not sufficiently “specific” or “personal”; and their allegations on financial mismanagement were too speculative to be accepted.
Both the Massachusetts Appellate Court and the lower court also came to the same conclusion on rejecting the merits of a new civil wrong on the “intentional investment in abnormally dangerous activities”. The students had, in the higher court’s assessment, “brought their advocacy, fervent and articulate and admirable as it is, to a forum that cannot grant the relief they seek.”
The Bacow formula of engagement has been tinkered with, if ever so slightly. As a tentative nod to the fiftieth anniversary of Earth Day, and in response to a resolution adopted by the Faculty of Arts and Sciences in February, the endowment was instructed to develop an approach to achieve net-zero greenhouse gas emissions from its investment portfolio by 2050. Full Postponement Bacow had now transitioned to Partial Postponement Bacow. “Harvard’s endowment should be a leader in shaping pathways to a sustainable future,” he wrote to members of the Faculty of Arts and Sciences. “With this in mind, the corporation has directed the Harvard Management Company (HMC) to set itself on a path to decarbonize the overall endowment portfolio.”
In doing so, few toes will be tread upon in this new approach, as it “considers the investment portfolio as a whole, rather than simply targeting the suppliers and producers of fossil fuels.” Possible partners, he warned, would not be demonised, as they had “committed to transitioning to carbon neutrality and to funding research on alternative fuels and on strategies to decarbonize the economy.”
The reaction from Divest Harvard showed an expected mixture of “I told you so” satisfaction tinged with regret. “Until today, the administration has claimed that the endowment should not be used for political purposes.” Finally, due to the pressure of student, faculty and alumni, Harvard had “acknowledged its duty to mitigate the emissions its endowment has been fuelling for decades.” Fossil Fuel Divest Harvard was less complimentary: the university had taken “a step in the right direction”, but the plan was “insufficient”, making fossil fuel companies “cooperative partners”.
Former college president James L. Powell assessed the nature of managing an endowment sternly in a recent letter to the New York Times. “The fundamental principle of endowment management is that future student generations should benefit to the same extent as the current generation. By investing in the very companies whose products cause dangerous global warming, Harvard violates that principle and bets that it can profit from the success of those companies.” Such betting is set to continue – at least till 2050.