College Endowments, Divestment, ESG Investing, and Corporate Sustainability

I recently published the following piece for Second Nature's @edu column on GreenBiz.com.  Read the full article here.

Will campus activism reach the C-suite?

Something's brewing on college campuses that soon may affect corporate sustainability professionals in all industries.

During the past year, a groundswell of action demanding that college and university endowments sell their holdings in fossil fuel companies has brought environment, social and governance (ESG) issues to the fore. Driven in large part by 350.org, the fossil fuel divestment movement has sprung up on more than 300 hundred campuses and is spreading to cities, faith organizations and beyond.

The latest news: Sterling College -- a small, private liberal arts college in Vermont -- has completed its divestment from the fossil fuel industry. While Sterling is small, with only about 100 students and an endowment of approximately $1 million, it provides more evidence that divestment is possible and relatively straightforward.

Do your homework

Common initial comcerns about divestment include that it is costly, complicated and requires investors to sacrifice returns. To divest, Sterling College chose a fossil-free option that Trillium Asset Management has offered clients for over a decade. “Those who say divestment is not possible haven’t done their homework,” said Matt Patsky, CEO of Trillium.

Trillium’s fossil free option replaces screened companies with similar investment characteristics (e.g. similar beta and return on equity). The result is a fossil-free option that doesn’t sacrifice returns. Recent reports from Impax Asset Management (PDF), MSCI (PDF) and Aperio Group (PDF) support the claim that removing fossil fuel investments from portfolios has a negligible impact.

Sterling is one of just six colleges to commit to divestment to date, along with Hampshire, Unity, Green Mountain, San Francisco State and College of the Atlantic. But many others are considering it.

Divestment highlights the moral hazard of our fossil fuel based economy for institutions that understand the devastating implications of climate change, yet support fossil fuel production as shareholders. This is a particularly difficult challenge for college and university endowments, designed to benefit institutions and students over the long term, in perpetuity. How is it justifiable to risk the fundamental resilience of our society from climate change impacts in the name of potentially higher financial returns? (Particularly when the data suggest those higher returns are negligible, if they exist at all.)

A moral paradox

Divestment proponents recognize that fossil fuel companies are unlikely to stop mining and drilling because some investors sold their shares -- others will buy them. But the movement highlights this moral paradox. And even if no other schools divest, it has sparked conversations on campuses across the country about a range of other ESG investment strategies.

And this could have dramatic implications across all industries -- not just fossil fuel companies. Every company currently has some responsibility, in one way or another, for greenhouse gas emissions and a wide range of other sustainability challenges such as water use, toxic chemicals, and labor and human rights issues. But those that are proactively implementing strategies that help move society towards sustainability can avoid risks and seize opportunities for innovation, attracting top talent and enhancing shareholder value...

Read the rest at GreenBiz.com's @edu blog.

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Culture Shift: Why culture trumps technology in moving markets

This great video of Rebecca Henderson's talk at VERGE is worth the 10 minutes.  She lays out four elements of a needed cultural shift:

1. Adopt an entrepreneurial mindset
2. Develop compassion for the core (e.g. the mainstream, the status-quo, those who don't see the need for change)
3. Become rational about emotions
4. Develop a systems mindset

Henderson explains each of these concisely in her talk below, and stresses, that like the "fifth discipline" the need for a systems mindset is the most important. 

Moving groups, organizations, and societies as a whole towards sustainability requires great collaboration and profound shifts in worldviews, values, and mental models (e.g. habits of thought, assumptions and blind spots).  I believe we have everything we need in terms of resources, tools, technology to create a sustainable society (though continuing to work and improve on those fronts is important, beneficial, and can potentially make the shift easier) -- and that we still have lots to do in bringing about the culture shift. 

That calls on us all to be open and provide leadership at all levels. Those acts of leadership often involve simply being strong enough to let go of assumptions and preconceived notions; to rethink success, and reevaluate what our fundamental needs are, and how we can most effectively go about meeting them. 

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Second Nature Climate Leadership Awards 2013

Second Nature has just announced the winners of this year's Climate Leadership Awards -- "an award program that recognizes signatory institutions of the ACUPCC for their innovation and excellence in climate leadership." 

Click on the following links to learn more about what's happening on these campuses, and watch videos from each. 

Winners of the 2013 Second Nature Climate Leadership Awards

Associate's Colleges

Bellevue College

University of Hawai'i Kaua'i Community College

Baccalaureate Colleges

Middlebury College

Oberlin College

Master's Granting Institutions

Chatham University

Goddard College

Doctorate Granting Institutions

Missouri Institute of Science and Technology

Portland State University

SUNY College of Environmental Science and Forestry


Special Focus Institution 

Pratt Institute


Finalists in the 2013 Second Nature Climate Leadership Awards

Associate's Colleges Glendale Community College Saint Louis Community College at Florissant Valley Baccalaureate Colleges Carleton College Hobart & William Smith Colleges Master's Granting Institutions American Public University System Western State Colorado University Doctorate Granting Institutions Georgia Institute of Technology Indiana State University Special Focus Institutions Massachusetts Maritime Academy University of Massachusetts Medical School

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'Grand Strategy' for sustainability

Below is an interview with Mark "Puck" Mykleby from the recent VERGE conference in Boston. It provides a great overview of his work on a "grand strategy" for the US, which shows the interconnectedness of defense, economic prosperity, and ecology -- and how a proactive, systemic approach to sustainability is the best path forward for the country and the world.

He lays out three major areas of opportunity: (1) housing (walkable, smart growth) (2) agriculture (regenerative agriculture); (3) productivity revolution (reduce resource intensity) . For all of these, sustainability is a central concept.

He also notes that higher education is a receptive partner.  Through the ACUPCC and our other education for sustainability work, we've seen colleges and universities demonstrating more and more leadership to engage with other sectors, take advantage of applied research opportunities, role model solutions on campus.

The work around applying "full-specturum sustainability" to regional clusters is particularly compelling. David Orr has been leading this type of work through the Oberlin Project -- a great cross-sector effort with involvement from government, business, schools and colleges, and faith and civic groups. It covers the full spectrum of sustainability, integrating issues around food, art, economy, education, transportation, technology, building, community, etc.

Having a marine talk about strategy for sustainability in this way is a great way to move past the partisan hang-ups and recognize that sustainability is about preserving and promoting a healthy thriving economies and communities.




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Create Stillness

by Emilie Oyen. Originally published on The Flame Tree. 

I'm looking at a painting on the wall that my friend made. It's so beautiful. When I wake up and throughout the day, it makes me happy. It reaches out to me and reassures me too. I love it. My friend is an artist and she's influenced by Japan and Buddhism and other things. The painting is seven or so sweeping, black brushstrokes. It took her probably ten minutes and her entire life, and also her ancestor's lives and all the Buddhists in the world to create it. How can you create a whole narrative, an entire novel, with seven strokes? How did she do that? There is yearning, there is love, there is tension and conflict. There is a tremendous rush and a turbulent fall. There is death and resurrection. There is escape. All in seven strokes.

To create art----do you remember that feeling? Do you remember that time of discipline, self-absorption, patience and wondering for a few months or maybe for years and years and then: one perfect brush stroke. And it is beautiful. It was not so long ago before children, work dinners, cell phones, music television dishes buses began to erode that time of creating.

It requires so much fortitude to create stillness in our lives today. It requires so much trust and patience to dwell in that stillness. To create space, stillness, enter it----and then to listen. That is the act of creation. That is also, I believe, the act of prayer. 

God is the poetry in your blood. Step aside, and listen.

Do The Math: The Movie

The movie stemming from 350.org's "Do the Math" tour last year has been released -- and it's a great watch.  Check it out for Earth Day and get involved:


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Shining a Light on Sustainability

Another great video providing an overview of the basics of sustainability science, and answers to the big "what is sustainability" question?


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