UPDATED: October 4, 2013, at 4:33 a.m.
University President Drew G. Faust reaffirmed Harvard’s resolution against divestment from the fossil fuel industry in a letter to the Harvard community on Thursday afternoon. The letter serves as Faust’s first formal rebuttal to months of petitions and protests from both students and alumni groups pushing for divestment of Harvard’s $32.7 billion endowment from fossil fuel companies.
A University spokesperson previously stated that Harvard “operates with a strong presumption against divestment.” On Thursday, Faust set out to explain this position in a letter of more than 1,200 words posted on the Harvard website.
“Climate change represents one of the world’s most consequential challenges. I very much respect the concern and commitment shown by the many members of our community who are working to confront this problem,” she wrote. “While I share their belief in the importance of addressing climate change, I do not believe, nor do my colleagues on the Corporation, that university divestment from the fossil fuel industry is warranted or wise.”
Faust’s letter drew a terse response from divestment advocacy group Divest Harvard, which on Thursday posted on its website a short statement that it said it will later expand.
“Leadership requires courage and vision–President Faust demonstrated neither. Today, she chose the fossil fuel industry over her students,” the statement said.
In her letter, Faust argued that divestment would politicize the University’s endowment, potentially weaken its investment returns, and distract from Harvard’s other environmentally-oriented efforts. She also remarked on a “troubling inconsistency” between demands for divestment and Harvard’s reliance on the products and services of fossil fuel companies.
“Given our pervasive dependence on these companies for the energy to heat and light our buildings, to fuel our transportation, and to run our computers and appliances, it is hard for me to reconcile that reliance with a refusal to countenance any relationship with these companies through our investments,” Faust wrote.
Moreover, she stated that because Harvard holds relatively few shares in any given company, divestment would have little impact on the industry but hinder Harvard’s ability to influence how those companies operate.
“Generally, as shareholders, I believe we should favor engagement over withdrawal,” she wrote. “In the case of fossil fuel companies, we should think about how we might use our voice not to ostracize such companies but to encourage them to be a positive force both in meeting society’s long-term energy needs while addressing pressing environmental imperatives.”
Faust listed a number of on-campus efforts to address climate change in her letter to the community, even labeling “teaching and research on environmental and climate issues” as a “priority” in the University’s potentially record-breaking capital campaign, which launched in September. She referenced the Harvard University Center for the Environment as well as the Office for Sustainability as efforts to promote ecologically friendly activity on and off campus.
The University has made moves in recent months to address concerns about responsible investment. In February, administrators announced the creation of a Vice President for Sustainable Investing position at the Harvard Management Company, which oversees the University’s endowment. In the same month, the Corporation Committee on Shareholder Responsibility met with student members from both Divest Harvard and the Responsible Investment at Harvard Coalition.
In an interview with The Crimson on Thursday morning, Faust said that the letter’s arguments should not be “surprising to anybody” and were “very much consistent” with what she and other University officials have said before.
"It seemed to me, and I discussed this with the Corporation at their meeting last week, that it was the moment in which we should make a statement about what we think about divestment,” she said. “We have been saying [we have a] presumption against [divestment], but it seemed that more clarity was a good idea."
The Harvard Corporation, also known as the President and Fellows of Harvard College, is the University’s highest governing body and includes Faust as one of its 13 members.
—Staff writer Nikita Kansra can be reached at Nikita.Kansra@thecrimson.com. Follow her on Twitter @NikitaKansra.
—Staff writer Samuel Y. Weinstock can be reached at Weinstock@thecrimson.com. Follow him on Twitter @syweinstock.