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Oxford under fire for increasing fossil fuel investments

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Oxford University has come under heavy criticism after its £6bn endowment increased its investment in fossil fuels just years after making a historic divestment commitment.

Although its investments are small, the fund's indirect exposure to fossil fuels increased from 0.32 percent to 0.52 percent between 2021 and 2022, according to published reports. Around £1 in every £200 in the fund is now invested in fossil fuels.

The university said in 2020 that it would abandon all direct investments in fossil fuels after sustained pressure from students and academics. But this does not apply to indirect exposure maintained through investments with third-party asset managers.

Zak Coleman, campaign director for Invest for Change, a UK Students Organized for Sustainability campaign, accused the university of using “loopholes” to continue investing in fossil fuels. The burning of fossil fuels is by far the largest contributor to climate change.

“It is extremely worrying to see the university exploit these loopholes in its already weak policy to continue investing around £31.2 million into the fossil fuel industry, which is working so hard to derail climate action.”

Environmental student activists from Oxford and Cambridge protest on London's Hammersmith Bridge during a regatta
Environmental student activists from Oxford and Cambridge protest on London's Hammersmith Bridge during a regatta © Jonathan Brady/PA

The Oxford Climate Justice Campaign, which led the push for divestment at the university, said: “This news is a shocking example of institutional greenwashing and a slap in the face to the students, staff, academics and alumni who worked tirelessly to divestment from fossil fuels. .”

The increased exposure to fossil fuels was a result of market movements as oil and gas stock prices rose in the wake of the energy crisis, as well as new investments with asset managers holding stakes in stocks with high carbon content.

Antonia Coad, head of sustainability and corporate affairs at Oxford University Endowment Management, which oversees the endowment fund, said the fund has “fully implemented” the university's divestment commitments.

He added that the fund's indirect exposure “will fluctuate for various reasons year on year,” including market movements as seen in 2021 and 2022.

The endowment fund, which oversees money for the university, its colleges and others, typically uses money managers to invest, meaning it makes few direct investments. OUem also manages a medium-term capital account for the university. Including the capital account, OUem said the university's exposure to fossil fuels was now 0.45 per cent.

Education endowments have come under intense pressure to move away from fossil fuels in recent years, with almost three-quarters of UK universities committing to full divestment.

This week, one of Europe's largest pension funds sold major oil and gas companies, including Shell and BP, over fears the companies were making little progress in transitioning to greener businesses.

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