Unity College marks 4 years at forefront of divestment
First U.S. college to nix fossil fuels from portfolio helped push $5.2 trillion toward ‘intentional investing’
On the anniversary of its historic decision to become the first U.S. college to divest from fossil fuels, Unity College is redoubling its efforts to create a net zero campus and spread sustainability broadly throughout society.
The Unity College Board of Trustees made history when it voted unanimously to divest its portfolio from investments in the Top 200 fossil fuel companies during fall semester 2012.
As the first institution of higher learning in the United States to take that step, Unity College became the standard bearer for a national movement that now has exceeded $5.2 trillion in assets diverted from fossil fuel production, according to a new report by Arabella Advisors. (See the bottom of this release for a full list of divested U.S. colleges.)
The Arabella report said the sum controlled by individuals and institutions committing to divest from fossil fuels has doubled over the past 15 months, with the movement spreading beyond mission-driven institutions. Foundations, faith-based organizations and universities continue to play a large role, with more than half of new commitments in the past 15 months, the report said.
“Our leadership and our board made this courageous decision after looking at the data on climate change and conducting due diligence on fiduciary responsibility,” said Unity College President Dr. Melik Peter Khoury.
“It’s not a statement. It’s not symbolism. It’s walking the talk when it comes to creating a sustainable path for society,” Khoury said. “We have a vision for a sustainable society that transcends our teaching methods and even our campus, and extends to ethical, systematic, comprehensive, scientifically-informed operational policies. The Unity College way is helping our students to learn from the process as we do the right thing.”
Media coverage of Unity College’s divestment decision included The Boston Globe, Rolling Stone Magazine, Time Magazine, Maine Things Considered, The New York Times, The Boston Globe, The Chronicle of Higher Education, Forbes, and dozens more.
Divestment did not happen overnight. In early 2008, a committee of the Board of Trustees asked Spinnaker Trust of Portland, Maine, Unity’s endowment manager, to reduce the school’s exposure to large energy companies and to move toward clean energy.
As Unity began that process, its exposure to Big Energy was approximately 10 percent of total endowment. The timeline allowed Unity’s investment manager to prudently shift investments, including fixed income bonds, over a five-year horizon. Since its divestment, Unity College has met targeted investment returns.
Khoury said it takes no more effort to manage a portfolio for minimum exposure to fossil fuels than it does to manage for maximum market return.
“We have continued to grow our financial portfolio in a way that allows us to continue to invest in student-facing improvements to ensure we will be here to educate the next generation of environmental professionals,” Khoury said. “Divestment, in and of itself, is agnostic when it comes to returns. Under current market conditions, our overall portfolio will generally not perform more poorly than the market average, while holding true to our vital promise and ethical duty to divest.
“Some critics challenge that Unity’s exposure was minimal because our endowment was small. To them, I point out that the stakes were actually much higher for Unity, as we could not afford to take a hit,” Khoury said. “Sometimes, the right thing to do requires risk.
“The other challenge I get is from financial officers who say they can’t simply pull out all their assets and move them. To them I say: make the commitment. Set a long-term goal. And work to get there,” he said. “Entangling a portfolio takes a long time. Disentangling can happen over time as well.
“Some schools are quibbling about a potential one-half a percent performance loss. To them I say, isn’t that amount of financial risk acceptable when the future of our planet is in the balance?” Khoury said.
In addition to being known internationally for being the first U.S. college to divest from fossil fuels, Unity College was the first college with a residence hall built to Passive House standards, known as TerraHaus; and the first with a president’s home, known as Unity House, to be certified LEED Platinum by the U.S. Green Building Council.
Unity College also earned high rankings this year from the well-regarded U.S. News & World Report, Sierra Magazine, and the Association for the Advancement of Sustainability in Higher Education, which ranked Unity College No. 1 in the nation for sustainability in its finance and investment practices.
Here is a comprehensive list of all U.S. colleges and universities that have divested since Unity College in 2012, in chronological order by approximate date divested. Endowment value source is Fossil Fuel Free USA unless otherwise listed:
• Unity College, ME ($15 million) FULL
• Hampshire College, MA ($40 million) FULL
• Sterling College, VT ($1.1 million) FULL
• College of the Atlantic, ME ($36 million) FULL
• Green Mountain College, VT ($1 million) FULL
• San Francisco State University Foundation, CA ($51 million) COAL, TAR SANDS
• Naropa University, CO ($6 million) FULL
• Foothill-De Anza Community College Foundation, CA ($33 million) FULL
• Peralta Community College District, CA, FULL
• Prescott College, AZ ($5 million) PARTIAL
• Pitzer College, CA ($124 million) FULL
• Stanford University, CA ($21 billion) COAL
• Union Theological Seminary, NY ($108.4 million) FULL
• University of Dayton, OH ($670 million) FULL
• Humboldt State University, CA ($28 million) PARTIAL
• Chico State University, CA ($53 million) FULL
• Goddard College, VT ($1 million) FULL
• California Institute of the Arts, CA ($115 million) FULL
• University Of Maine System, ME ($248 million) COAL
• The New School, NY ($220 million) FULL
• Pacific School of Religion, CA ($45 million)
• Brevard College, NC ($19 million) FULL
• Syracuse University, NY ($1.8 billion) FULL
• University of Washington, WA COAL
• University of Hawaii, HI ($66 million) FULL
• Georgetown University, DC COAL
• The Rhode Island School of Design, RI FULL
• University of California System, CA, ($200 million) COAL, TAR SANDS
• ESF College Foundation, NY ($29 million) FULL
• Yale University, CT ($10 million) PARTIAL
• University of Massachusetts, MA ($770 millon) FULL