One way to battle against the destruction of civilization by greenhouse gases is to
encourage people and institutions to divest from fossil-fuel companies, basing this
encouragement on a moral argument supported by a financial argument.

The Moral Argument

The moral argument says, in Bill McKibben’s words, “if it’s wrong to wreck the climate,
it’s wrong to profit from that wreckage.” It is time to be “going after the fossil fuel
companies,” because theirs is a “rogue industry.” “Mr. McKibben’s goal,” said New
York Times writer Justin Gillis, “is to make owning the stocks of these companies
disreputable, in the way that owning tobacco stocks has become disreputable.”
Another precedent appealed to by McKibben was the movement to divest from
apartheid South Africa, which was crucial in bringing that system down. By turning
fossil-fuel industries “into pariahs,” McKibben argues, their “chokehold on politics”
can be weakened. [31]

Indeed, Bishop Desmond Tutu wrote: “Just as we argued in the 1980s that those who
conducted business with apartheid South Africa were aiding and abetting an immoral
system, we can say that nobody should profit from the rising temperatures, seas and
human suffering caused by the burning of fossil fuels.”[32]

McKibben’s divestment campaign began with colleges and universities, where faculties
and students seek to convince their administrations and trustees that they should
divest. Although several schools quickly saw that this would be the right thing to do,
many did not. At Harvard, 72 percent of the students said that the school should divest,
but its president, Drew Faust, said that divestment would be neither warranted nor
wise: The task of the administration and trustees is to protect and increase its
endowment, which should not be used for social purposes. Her argument was publicly
challenged by then-Mayor Mike McGinn of Seattle, which had already divested. He
agreed that she needed to make sure that Harvard’s endowment would be there for
future generations, just as he as mayor had to protect the city’s pension system. But,
he added, “We also share a greater and overlapping responsibility - one to our planet
and to future generations,” so they needed to figure out how to do both. He also argued
that Harvard has a special responsibility: Having “the largest academic endowment in
the world, one that rivals the size of the economies of many countries, Harvard is
uniquely positioned to lead on this issue.”

Responding to Faust’s statement that divestment would mean “using the endowment
as an instrument of political and social change,” he reminded her that Harvard had
done this before, when in 1990 it divested from the tobacco industry. This decision was
motivated, then-President Derek Bok had explained, because Harvard did not want to
be “associated as a shareholder with companies engaged in significant sales of
products that create a substantial and unjustified risk of harm to other human beings.”

Although the program to divest has now expanded to all public-interest institutions,
especially seminaries and churches – including the World Council of Churches, which
represents a half billion people [34] – it was wise for divestment movement to begin
with colleges and universities, because just as the anti-Vietnam-war movement was
primarily fueled by students, who did not want to die or have their friends die in an
immoral war, young people do not want their futures destroyed by climate disruption.
One student said: “By the time we’re ready to have kids, buy a home – it’s already a
radically different world if we don’t put the brakes on as quickly as possible.” Other
students, disappointed that their school’s board of trustees had rejected their call to
divest, said: “When it comes down to it, the members of the board are not the ones who
are inheriting the climate problem. We are.”[35]

However, the appeal to students is not merely to their self-interest. McKibben tells them,
“this is not only the crisis of your lives – it is also the crisis of our species’ existence.”

The Financial Argument

The financial argument for divestment is that fossil-fuel stocks are becoming
increasingly risky, so if individuals and institutions do not delete them from their
portfolios, they are liable to lose a lot of money. This argument was stimulated by
Carbon Tracker, which pointed out that, because we now know that most of the carbon
in the ground must stay there, to prevent runaway global warming, those having
portfolios with many fossil fuel stocks are destined to end up with a lot of stranded
assets, meaning that they will be worthless. [37]

Al Gore, who is now the chairman of an investment firm, has referred to the estimated
$7 trillion in carbon assets on the books of multinational energy companies, saying:
“The valuation of those companies and their assets is now based on the assumption
that all of those carbon assets are going to be sold and burned. And they are not.”
Although people might believe that Gore’s opinion is biased because he is opposed to
fossil fuels, this warning has already been made in a study (“Oil and Carbon Revisited:
Value At Risk From ‘Unburnable’ Reserves”) prepared by HSBC Global Research. [38]
This case has also been made by Craig Mackenzie’s Scottish Widows Investment
Partnership, a division of Lloyds Banking Group, which has about $230 billion of assets
under management. McKenzie has said that “many have a misinformed view that
carbon assets will not be stranded until there is a global treaty establishing a uniform
price on carbon.” McKenzie’s institution has, in fact, already sold all of its carbon
stocks. [39] Another misinformed view, says Tom Steyer – who founded a hedge fund
and is now a billionaire – is that people can wait to get out just before the bubble bursts.
That, says Steyer, is “one of the stupidest things I’ve ever heard.”[40]

The Combined Argument

Whereas some people focus on one or the other of the two arguments, some people
combine them. Professors at Cornell University wrote:

    Although some financial sacrifice in pursuit of our institutional responsibility
    would be justified, we have . . . determined that [divestment] will not only have a
    negligible impact on growth of the university’s endowment, [it] may significantly
    reduce overall risk in the university’s investment portfolio.

Likewise, Daniel Kammen, who teaches energy studies at the University of California,
has said:

    UC Berkeley and most institutions are financially invested in destroying our
    future. Instead of funding the problem, we should be investing in solutions that at
    once aid the transition to a low-carbon economy and grow our university’s bottom
    line. There is no lack of financially and environmentally sustainable reinvestment
    opportunities. [41]

Finally, this twofold argument has been made on the occasion of the biggest
divestment decision to be made so far by one of the major funds, the Rockefeller
Brothers Fund: Just before the UN climate meeting in September 2014 at which the
announcement was made, Steven Rockefeller, who is a philosophy professor as well
as a trustee of the Fund, said, “We see this as having both a moral and economic
dimension.” [42]


An increasing number of writers have been saying that we need a new abolitionist
movement: Just as it was necessary at one time for slavery to be abolished, it is now
necessary to abolish the fossil-fuel economy.
Lacey, “Do the Math: Mr. McKibben Goes to Washington,” Climate Progress, 19 November 2012; Justin
Gillis, “To Stop Climate Change, Students Aim at College Portfolios,” New York Times, 4 December 2012.

32        Desmond Tutu, “We Fought Apartheid. Now Climate Change Is Our Global Enemy,” Observer,
20 September 2014.

33        Mike McGinn, “Let’s Prevent This Crisis: A Letter to Harvard’s President Faust,” Office of the
Mayor, City of Seattle, 17 October 2013.

34        Antonio Blumberg, “Union Theological Seminary in NYC Unanimously Votes to Divest from Fossil
Fuels,” Huffington Post, 10 June 2014; Paul Brandeis Rauschenbusch, “Fossil Fuel Divestment Strategy
Passes at United Church of Christ Convention (UCC),” Huffington Post, 2 July 2013; Emily Atkin, “Group
Representing Half a Billion Christians Says It Will No Longer Support Fossil Fuels,” Climate Progress, 11
July 2014.

35        McKibben, “The Case”; Gillis, “To Stop Climate Change.”

36        McKibben, “The Case.”

37        “Unburnable Carbon 2013: Wasted Capital and Stranded Assets,” Carbon Tracker, 2013.  

38        Aaron Task, “Al Gore: ‘Carbon Bubble’ Is Going to Burst – Avoid Oil Stocks,” Daily Ticker, 18
October 2013; “Climate Action Could Halve Energy Firms’ Worth –  Bank,”, 4 February

39        Tom Randall, “Oil’s Future Draws Blood and Gore in Investment Portfolios,” Bloomberg, 18
November 2013.

40        McKibben, “The Case for Fossil-Fuel Divestment.”

41        Ilaria Bertini, “US Academics: Fossil Fuel Divestment Reduces Long-Term Financial Risks,” Blue
and Green Tomorrow, 5 December 2013.

42        John Schwartz, “Rockefellers, Heirs to an Oil Fortune, Will Divest Charity of Fossil Fuels,”
York Times
, 21 September 2014.