![Dalhousie won’t divest fossil fuel holdings](https://www.benefitscanada.com/wp-content/uploads/sites/7/2012/09/new-media21.jpg)
Dalhousie University’s board of governors decided on Tuesday not to divest its holdings in publicly traded companies that are large carbon producers.
Student group Divest Dal, which is supported by the Dalhousie Faculty Association and the Dalhousie Student Union, had written a number of reports and given several presentations to the university’s investment committee about the financial benefits of divestment.
In order to reach a decision on divestment, the board had to consider its fiduciary duty to generate reasonable risk-adjusted returns from a diverse portfolio of investments, taking into account the wishes of its benefactors, says board of governors chair Lawrence Stordy.
Read: Responsible investment and fiduciary duty
“Divestment could undermine the execution of a diversity strategy and would potentially frustrate the goal of generating such reasonable returns,” he says.
The board believes it will have more influence with regard to climate change as an engaged investor than it would through a one-time decision to divest holdings in carbon companies.
“We also believe it is consistent with the mission of the university to work with all companies that support research that addresses the key issues of climate change—even if they hold significant carbon assets,” Stordy explains.
Divest Dal says board members made “the wrong choice.”
“You were given an an opportunity to choose what is right for Dalhousie University and for the generations that will inherit this planet when we leave,” says a letter addressed to board members. “We feel that your choice has smeared the face of Dalhousie University.”
Read: Strategy: Shifting gears
Still, the board accepted a recommendation from the investment committee that it investigate ways to allow new Dalhousie benefactors to channel their donations to environmentally sustainable fund options, and that it establish a mechanism for enabling this donor choice as soon as possible.
It also endorses the committee’s proposals to report annually on all holdings in publicly traded companies, and to continue to press external fund managers to incorporate the United Nations Principles for Responsible Investing in their practices.
To date, Dalhousie says no Canadian universities have divested its holdings in carbon or fossil fuel companies.
Read: Making green investments