Currently browsing posts filed under "Divestment"
Useful overview from the New Yorker.
However, if the aim of divestment campaigns is to reduce companies’ profitability by directly reducing their share prices, then these campaigns are misguided. An example: suppose that the market price for a share in ExxonMobil is ten dollars, and that, as a result of a divestment campaign, a university decides to divest from ExxonMobil, and it sells the shares for nine dollars each. What happens then?
Well, what happens is that someone who doesn’t have ethical concerns will snap up the bargain. They’ll buy the shares for nine dollars apiece, and then sell them for ten dollars to one of the other thousands of investors who don’t share the university’s moral scruples. The market price stays the same; the company loses no money and notices no difference. As long as there are economic incentives to invest in a certain stock, there will be individuals and groups—most of whom are not under any pressure to act in a socially responsible way—willing to jump on the opportunity. These people will undo the good that socially conscious investors are trying to do.
Exactly right. Who don’t more people in favor of Williams divesting from X or Y or Z — I lose track of the current issues du outrage — understand basic economics?
Here is the summary (only?) document regarding the College’s recent announcement of its plan to address climate change. The Record has not covered itself in glory the last few years with regard to these sorts of announcements, often failing to quote (interview?) critics of Williams or to even ask any hard questions. So, let’s help the Record by suggesting some questions it should ask. (Reader suggestions are also welcome in the comments.) Block quotations below are from the document, followed by suggested questions.
The initial cost of divestment would be in liquidating the portfolio which, even done in an orderly fashion over the course of a year, would cost $75 million or more.
Will the College share the details of this calculation? Many members of the community find it to be absurdly high, given that the vast majority of investment vehicles that Williams participates in have no coal holdings and are happy to certify this fact.
Make anthropogenic climate change a campus-wide theme of inquiry in the 2016-17 academic year.
Will Williams include all sides to the debate as part of this programming or will the College only invite speakers and/or stage events which reinforce your claim that “global climate change is an urgent issue and that Williams has an obligation to address the issue in substantive ways.” For example, many people (including many Ephs) believe that there are many policy issues more important than climate change. Others argue that elite colleges like Williams should focus on their educational mission without being distracted by contentious issues of public policy.
[T]hese planned investments will total approximately $50 million over the next 5 years
Is Williams committing to transparency in providing details to the community with regard to these investments?
A political and ecological crisis of this scale demands the leadership that the Williams community can offer.
You claim that you and the trustees agree with this statement. If so, will you and the trustees agree to the demonstrate a minimum amount of personal leadership/responsibility by, for example, not engaging in private air travel? It is hard to take serious anyone who claims to be concerned with carbon emissions but who, at the same time, takes part in just about the most carbon producing individual activity possible.
On the those same lines, will you agree to start using the Williams President’s House? As you know, you are the first Williams President for more than 100 years to insist on living elsewhere. Given that housing is one of the biggest ways that individuals contribute to carbon emissions, it is fair to say that you, personally, contribute much more to carbon emissions than your predecessors. Why not show some personal leadership and only have one house?
It is hard to take serious the claim that climate change is a crisis until the people who say that it is a crisis start acting like it is a crisis.
In 2007, the college committed to a goal of reducing its greenhouse gas emissions to 10 percent below 1990 levels by 2020, and we are 75 percent of the way there.
Will you commit to better transparency with regard to the College’s greenhouse gas emissions? Many people doubt whether this claim is, in fact, true. Where is the data to back it up? Indeed, given that the College has many more larger buildings and employs many more people now than it did in 2007, how could it possibly be that greenhouse gas emissions have gone down so far?
[W]e will then seek to take the further step of achieving net carbon neutrality for the college through the incremental purchase of carbon offsets on the global market.
The College participated in purchasing carbon offsets back in 2007. Many observers believe that this was a failure, bordering on fraud. Have you checked whether the College spending at Owl Feather War Bonnet Wind Farm and the Wanner Family Dairy Farm Methane Project actually resulted in carbon reductions? Has anyone? If not, then why would we expect new purchases to be any more effective?
This should be enough material to get the latest set of Record reporters going. Please try to do more than simply reprint the College’s press release.
Not sure if this link will work, but below is the key message.
1) The best policy would be:
The Williams Investment Office is charged with managing the endowment in order generate the most returns with the least risk, consistent with legal requirements and ethical norms. No account is taken of contemporary policy debates concerning climate change, Palestine, child labor, racial justice, or any other issue.
2) Did Eisenson really say that the “trustees want to do something big?” That would be a strange thing to say unless he and the trustees had already decided on what they wanted to do. It is also strange that the ACSR’s report would be so balanced — not endorsing divestment nearly as strongly as it could have — if major action was in the works.
3) Predictions? I don’t know. Judging by the tone of the ACSR report, and the fact that places like Harvard have strongly resisted calls for divestment, I was expecting no policy change. But Eisenson is a smart and powerful Eph. I would expect him to not even take that meeting, much less mention “something big” if the plan was to maintain the status quo.
Should I spend two weeks critiquing it and the more detailed Williams Divestment Proposal?
All-campus e-mail from President Falk:
To the Williams Community,
Given the broad interest in the work that the Advisory Committee on Shareholder Responsibility has been doing to analyze the proposal that the college divest from 200 companies involved with fossil fuel extraction, I thought I’d let you know that the committee’s report on the matter is now complete and available online.
The report articulates those areas on which the committee reached consensus and those on which after careful deliberation there was not agreement.
The Board of Trustees began discussing the report at its meeting last weekend. The trustees’ deliberations, which will continue over the coming months, rest on the premises, which I share, that the climate is changing, that the causes of that change are almost assuredly human, and that Williams must develop a strong and broad-based response.
For now our thanks go to ACSR Chair Anand Swamy and the whole committee for their thoughtful work on this important issue—work that has modeled how people with differing viewpoints of how to achieve a shared goal can engage with each other in ways that are both vigorous and respectful.
First, kudos to the ACSR/Falk for making the report public. Williams needs more transparency. (But, since Williams has a history of making reports public and then disappearing them, I saved copies of the report and the appendix.)
Second, I am unimpressed with the report because it fails to provide the best arguments against divestment, even in the section labeled “The Case Against Divestment.” This is, frankly, pathetic. It is perfectly reasonable to conclude, as Stanford has done, that a college should divest. You or I may disagree, but that is OK. It is not reasonable to claim (believe?) that you are, for purposes of discussion, providing the best arguments against divestment when, in fact, you are not, either because of a desire to win the argument or a failure to even know what those best arguments are. (I am not sure which explanation reflects more badly on the ASCR.)
Third, there is much material in the report worthy of discussion. Who wants to see a 10 day EphBlog critique/discussion?
Fourth, as always, the underlying politics are interesting. I suspect that there are powerful forces at the College who do not want divestment and have pushed hard against it. Why else would the Investment Office go to the trouble of writing an op-ed in the Record? (By the way, this op-ed is filled with lies-by-omission. With luck, it will only take 5 days to unpack them.) Comments by insiders on the internal politics of divestment are welcome.
Currently browsing posts filed under "Divestment"