Despite unanimous votes in the Undergraduate Senate and the Graduate Student Council, two referenda showing 83% student approval and a 600-signature petition, Stanford University still refuses to divest from fossil fuels. Stanford most recently demonstrated its intransigence in the face of the climate emergency last June, when the Board of Trustees and Faculty Senate voted against a resolution calling for divestment.
Yet Fossil Free Stanford remains heartened by the outpouring of student and alumni support for divestment. We believe that as the brutal reality of the climate crisis becomes even more clear, and as peer institutions like Harvard divest, Stanford’s position on divestment becomes even less justifiable.
None of the arguments on which opponents of divestment relied included a discussion of the impact of climate change on marginalized communities. Instead, opponents referred to two arguments, neither of which withstand scrutiny: 1) the necessity of maintaining oil and gas industry-funded research and 2) the small impact of divestment.
The first argument runs as follows: Oil and gas companies are responsible for funding significant amounts of environmental research at Stanford. If Stanford were to divest, it could signal to these companies that the university does not support them, leading these companies to withhold further funding. Stanford claims the loss of that funding would inhibit Stanford researchers’ further investigation into emissions reductions strategies.
This argument presumes that oil and gas companies are interested in research on emissions reductions. Greenwashed marketing strategies aside, the historical record demonstrates the opposite. Since the 1980s, fossil fuel companies have sought to discredit research on the scope of the climate crisis in any way they could. Between 2015 and 2018, the five largest publicly traded oil and gas companies reportedly spent $1 billion promoting their climate disinformation campaign through “branding and lobbying.” ExxonMobil, which contributes at least $250,000 per year to Stanford’s Natural Gas Initiative, contributed almost $16 million to advocacy organizations which spread climate misinformation. Shell, another member of the Natural Gas Initiative, donated nearly $500,000 to Dutch climate denialist Frits Böttcher. Both companies have known about the reality of climate change since the 1980s yet chose not to share their research with the rest of the world. This track record indicates that these companies’ claims to support unbiased, objective research are laughable.
Stanford’s partnerships with these companies have not prevented them from targeting Stanford researchers. ExxonMobil has repeatedly attempted to attack and discredit the reports of the Intergovernmental Panel on Climate Change, a UN body on which Multiple Stanford climate scientists have served, including Paul N. Edwards, a lead author of the IPCC’s 2021 6th Assessment Report, and Chris Field, a co-chair of Working Group II of the IPCC. Stanford’s decision to not only invest in but also receive research funding from companies that directly attack its own scholars is baffling.
This concerted misinformation campaign demonstrates that the research funding these companies provide is not intended solely to help with emissions reductions. Indeed, top oil and gas companies jointly spent only around one percent of their 2018 budgets on clean energy. To the extent that opponents of divestment are concerned about funding for further research on emissions reductions, relying on the fossil fuel industry to support this research is counterproductive.
Secondly, opponents of divestment argue that because Stanford invests so little — only 1.5% — of its endowment in the oil and gas industry, its divestment would not materially impact those companies. As such, divestment would only serve to sever research ties with the oil and gas industry, while doing nothing to change industry practices.
This argument ignores the important social effects of divestment. Stanford’s continued financial investment gives social license to operate to the fossil fuel industry by throwing the university’s intellectual weight behind the industry’s actions. Indeed, divestment rarely materially impacts companies’ profits. Instead, as University of Oxford philosopher William MacAskill argues, divestment’s primary utility is its ability to generate social stigma. Historical divestment campaigns, such as the one against South Africa, may not have financially decimated the companies involved, but they nonetheless played an important part in the broader social movement against the apartheid regime.
Stanford recognizes this logic. Its decision to divest from the genocidal Sudanese regime in 2005 and from the coal industry in 2013 prove that Stanford recognizes that certain industries are responsible for such abhorrent social and ecological consequences that it cannot ethically justify its continued investment in them. As the year and a half since the Board’s vote demonstrates, fossil fuel companies’ continued role in climate change makes them one such industry.
I will not use this space to restate the multitude of reports that lay out the fossil fuel industry’s ongoing role in the climate crisis. Nor do I need to remind the reader of the scientific consensus on the reality of anthropogenic climate change. But given new developments since the Board’s vote, it is now even more apparent that Stanford must divest.
The climate crisis has only continued to escalate. This summer’s wildfires killed at least 22 people and impacted air quality across the Bay Area. The threat of wildfires and heat-related illnesses near Stanford are expected to increase as the temperature rises. Alongside the physical threat to Stanford’s community, climate change magnifies existing socioeconomic disparities in the Stanford area and around the world. Low-income communities and communities of color lack access to quality healthcare or amenities like air conditioning, placing them at greater risk of climate-change related health threats.
Fossil fuel investments have become even more risky, as well. The recent energy price shock has underscored the vulnerability of energy supply chains and the potential for increased oil price volatility moving forward, as a recent Wall Street Journal piece argues. Because of this price volatility, as well as tightening regulations and reduced profits, credit rating agency S&P informed thirteen oil & gas companies in January 2021 that it might downgrade their credit score, a sign that fossil fuel investments are becoming riskier. Moreover, multiple studies of past divestments and socially responsible investment strategies indicate that divestment from fossil fuels would have no negative effect on the endowment’s return. Stanford’s fossil fuel investments, therefore, are not only ethically bankrupt — they are financially unsound.
Finally, peer institutions’ recent divestments demonstrate that Stanford is simply not the leader it claims to be. Harvard University’s September announcement of its decision to divest has been followed by a wave of divestment announcements from institutions like Dartmouth College, Boston University and the University of Minnesota. These decisions prove that other institutions have found ways to deal with the potential for a loss of research funding and reflect the new reality that fossil fuel investments have become harder to socially and ethically justify. If Stanford does not wish to fall behind other universities, now is the time for it to reconsider divestment.
Stanford, as an educational institution, cannot fulfill its responsibilities to its students and community while continuing to finance an industry that has made a business strategy of attacking academic research and is actively poisoning the planet on which Stanford’s students will have to live. Fossil Free Stanford will continue to organize until Stanford, like so many of its peers have done, puts its money where its mouth is and divests.