Fossil Fuels & the Smith Endowment
October 18, 2019
Dear Students, Staff and Faculty:
We are pleased to report that the Smith College Board of Trustees at its October meeting made a significant advance in reducing the role of fossil fuel investments in the college’s endowment. The board’s decision follows a recommendation of the Study Group on Climate Change (SGCC) to align more closely our investments with our values. The SGCC report was endorsed by the trustees in 2017.
Specifically, the board voted to approve the following two recommendations brought forward by the Advisory Committee on Investor Responsibility (ACIR), a subcommittee of the Investment Committee of the Board of Trustees:
- Effective immediately, the board will direct Investure, the college’s outsourced endowment management firm, to exclude from the Smith College endowment all future investments with fossil fuel–specific managers.
- The college will begin an immediate phaseout of all current investments with fossil fuel–specific managers in the Smith College endowment. This phaseout will be achieved through the sale, maturity or liquidation of investments held by fossil fuel–specific managers over a projected period of 15 years.
Note: A fossil fuel–specific manager is one whose main strategy is acquiring, developing, producing or exploring for oil/gas; coal mining; or providing oil and/or gas equipment, services and/or pipelines; or that is an investment fund whose primary purpose is to invest in such issues or engage in any such business itself.
These recommendations are the result of significant work on three fronts.
First, the college has been working closely with Investure, and other Investure clients, to create new sustainable investment opportunities within the shared investment pools. The ability we now have to select or omit investments with fossil fuel–specific managers is a direct result of that work.
Second, in October 2017, the board of trustees endorsed four strategic recommendations from the ACIR regarding climate change and the Smith endowment and committed to a two-year review of their implementation. As part of that review, which took place in the summer and fall of 2019, the student organization Divest Smith College presented the ACIR with a formal request that Smith further build on the original recommendations by implementing the new sustainable investment opportunities available through Investure. The ACIR studied and endorsed Divest Smith’s request, and the Investment Committee voted to advance the proposal to the Smith College Board of Trustees.
Third, we remain committed to the SGCC’s recommendation that Smith continually consider how it can contribute to climate-change solutions within the framework of its education mission. These two new actions align with and build on the momentum of our ongoing work, which includes partnering with four other colleges on a 46,000 megawatt-hour solar array in Farmington, Maine; exploring the potential of geothermal energy through a pilot well underway near the Field House; reducing carbon emissions (already down by 29 percent since 2004); and embedding environmental sustainability in more than 100 courses in our curriculum.
As we acknowledge this progress, we recognize that our work is not done. The “Climate Equity and Justice: Solutions in Action” conference earlier this month reminded us that the health of our planet is a complex, urgent problem that affects every aspect of our lives. Consequently, our responses must be equally far-reaching: extending through not only our investments but through every aspect of our operations and our community.
We thank all of you who have contributed to Smith’s ongoing work on climate equity.
Sincerely,
Kathleen McCartney
President
Deborah L. Duncan ’77
Chair, Board of Trustees