Oxford University will ban its investment arm from spending money with the fossil fuel industry.
The university says the approach is based on its own academic research on climate-conscious business practices, the Oxford Martin Principles for Climate-Conscious Investment.
This is a framework for engagement between investors and companies across the world, helping them assess whether investments are compatible with a transition to a more stable climate and the goals of the Paris Agreement on climate change.
Announcing the divestment decision, the University’s council highlighted how the framework has already helped Oxford University Endowment Management (OUem) reduce its exposure to fossil fuels to ‘very low’ levels, below that of many other institutions.
Since 2007, the university’s investment in the energy sector has declined from an estimated 8.5% of the endowment to 2.6%.
This includes renewable energy and just 0.6% of the endowment is now in fossil fuel extractors. OUem says it has made ‘substantial’ investments in solutions to climate change and in sustainability.
Professor Louise Richardson, Vice-Chancellor of Oxford University, said: ‘Oxford is a global pioneer in many areas of environmental research and science, from climate economics to biodiversity, energy use, and climate change modelling. I am very grateful to all the staff and students who came together to develop this new and exciting agreement on investment which I warmly welcome.
‘Coupled with our research strengths, our new approach will enhance our position as a world leader in reducing carbon emissions and tackling climate change before it is too late.’
Professor Cameron Hepburn, director of the Smith School of Enterprise and Environment, said: ‘This is not mere divestment; this is a commitment to divestment plus engagement, according to the Oxford Martin Principles, to help accelerate progress towards net-zero emissions. It is right that Oxford’s leadership on the science, economics and finance of the transition to net zero emissions should be consistent with how we invest our endowment.’
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