The UC Task Force on Sustainable Investing chose not to recommend that the University of California divest funds from fossil fuel companies, instead advocating a “framework for sustainable investment” that would consider environmental and social factors.
The recommendation, announced Wednesday, will be presented to the UC Board of Regents’ Committee on Investments on Friday. The regents will vote on the recommendation at their upcoming meeting, which takes place Sept. 17 to 18, and, if approved, would proceed in implementing the framework before the end of the current fiscal year.
The task force is an 11-member group of financial experts, UC faculty and student representatives. UC President Janet Napolitano and Regent Bruce Varner, who is also the chair of the board, instituted the group in June to address concern over the university both investing in fossil fuels and committing itself to sustainability.
“It was a victory in that it was not a ‘no’ on divestment, but the process was extremely discouraging,” said Victoria Fernandez, a UC Berkeley senior, member of the task force and coordinator for Fossil Free UC, a campaign urging the university to divest. “We hope that divestment can continue forward.”
Fernandez said the task force made a series of phone calls that did not include students and invited coal advocates to present their views, while the student representatives were not able to invite divestment advocates.
UC spokesperson Dianne Klein said students were always consulted and there were no sidebar meetings. The student representatives were the only ones to vote against the recommendation, she said.
“Today’s announcements show the very real commitment of the University of California to invest our human and financial assets in finding solutions to global climate change,” Napolitano said in a statement.
Divesting funds from fossil fuels would mean that the university would stop investing in companies with high fossil fuel reserves. Currently, $3 billion of the $91 billion managed by the university is invested in these companies, according to Klein.
Rather than divestment, the task force’s plan calls for including environmental and social concerns in investment decisions and creating a culture of awareness about these concerns in the Office of the Chief Investment Officer of the Regents.
The plan also calls for the allocation of $1 billion to “solutions-oriented” investments such as renewable power and fuels, among other things.
“We believe we now have an effective plan of action to both protect and bolster the long-term returns for the university and to make a significant contribution to climate change solutions,” said Jagdeep Singh Bachher, UC chief investment officer and head of the task force, in a statement. “We could have made a narrow divestment decision, but the university is not in the business of taking the easy route.”
But fossil fuel divestment is both economically and environmentally sound, according to Daniel Kammen, a campus professor of energy.
“It is very unlikely there will be foregone profits. Fossil rules carry a significant risk over time,” Kammen said. “Divesting is a prudent economic as well as environmental approach.”
Fossil Free UC plans to continue advocating divestment at the regents’ committee meeting Friday and at the board meeting Sept. 17 to 18.