Not only did the Board of Governors fail to acknowledge the moral imperative to divest from fossil fuels and forget about the university’s strategic plan, it seems they can’t even bother to look for investments where the money might perform better.
Whatever is driving the board’s resistance to divestment, it’s certainly not rational. Maybe they’re just not paying attention to the ecological challenges faced by younger generations. Maybe they don’t care about the legacy they will leave behind for our children. Didn’t the university say it was committed to “sustainable social, cultural, and economic development” in its strategic plan back in 2012?
Perhaps it never occurred to board members that paying attention to the UN is important in a globalized economy. Just recently, for example, the UN reported that “almost half the world’s population will be living in areas of high water stress by 2030,” meaning problems with access to safe water. This has a lot to do with climate change. As the world heats up, in large part due to burning fossil fuels, the need for water purification, distribution, and infrastructure is intensifying.
Didn’t the strategic plan also mention “community” and “region?” Maybe they haven’t been paying attention to how cities are adapting to mass urbanization. By 2050, 66 per cent of the world’s population will live in cities. Cities require A LOT of plumbing, water treatment facilities, and other water infrastructure for this to be feasible. Here on the island, the Capital Regional District needs a new water treatment facility right now.
Or perhaps they’ve forgotten the basics of stock market investing. Economists teach that shortages create demand. Entrepreneurs teach that you make money by solving problems for people. There is clearly a rising demand for clean water, and it will be a problem for billions of city-dwellers alone. Keep in mind, investing ought to have nothing to do with left-wing or right-wing politics: some combination of private and public enterprise will have to meet that demand.
Water investments illustrate how it is completely possible to outperform fossil fuels. For example, units in the Blackrock iShares Global Water ETF — a relatively low-risk investment fund with a small management expense ratio — is widely available through online investing. It is just one of many securities without the moral peril of the fossil fuel industry. If the board had invested in this particular example just five years ago, UVic would have almost doubled its money by now. Fossil fuels simply can’t compete with those kinds of returns.
The moral argument for divestment is pretty hard to dismiss and the board needs to meet the objectives in the university’s strategic plan. But one must also wonder if they are doing their economic due diligence. It seems they would have divested out of fossil fuels already if they were.