Opinion guest column

Now is the time for MIT to divest from fossil fuels

MIT should not be resisting the divestment movement. It should be leading it

On Sept. 17, the University of California (UC) system announced that it would divest not only its $13.4 billion endowment from fossil fuel companies but also its $70 billion pension fund by the end of the month. The UC system is just the most recent and highest-profile of many colleges and universities across the country that have divested from fossil fuel companies. The UC system’s commitment to complete divestment of its huge investment portfolio demonstrates that divestment is both feasible and financially sound. 

When the UC system’s chief investment officer and the chairman of its Board of Regents’ Investments Committee announced the decision, they did not cite the moral demands of the global climate emergency, but rather acknowledged that investments in fossil fuel companies are financially dangerous. “We have been looking years, decades and centuries ahead as we place our bets that clean energy will fuel the world’s future,” they wrote. The U.N.-backed Principles for Responsible Investment organization (to which the UC system is a signatory) argues that policy responses to the climate crisis are likely to dramatically undermine the value of major energy companies that derive the vast majority of their profits from fossil fuel extraction, making investments in these companies risky. 

We are asking MIT to divest from fossil fuels because we want to see the Institute excel as a leader in driving the decarbonization of the economy. MIT cannot do that while continuing to place financial bets on fossil fuel extraction. Furthermore, by staying invested in fossil fuels, MIT stands to lose regardless of how the political struggle over decarbonization plays out. Rapid decarbonization will hurt these investments, and if decarbonization doesn’t happen quickly, MIT will have bigger problems to worry about than the return on its endowment — for example, the fact that its campus will be chronically flooded by rising sea levels in a matter of decades and that the futures of more and more of its students and alumni will be foreclosed by climate-driven scarcity, poverty, and instability. 

Of course, this is not just a matter of MIT’s self-interest. The climate emergency is a crisis of empathy. It forces us to ask ourselves: Do we care about rural communities whose water is being poisoned by fracking? Do we care about people dying of lung cancer caused by air pollution? Do we care about people facing one cataclysmic storm after another in the Carribean and southeastern U.S.? Do we care about people in California whose homes have burned in unprecedented wildfires? Do we care about people in Guatemala facing starvation due to intensifying droughts and crop blights? Do we care about people in Nigeria being killed and tortured for opposing oil extraction by multinational corporations? MIT should be asking itself all these questions and more — and answering “yes” to every single one. 

If MIT does care, it is clear what we as an institution need to do.

By divesting from fossil fuels, MIT can send a strong message that extracting and burning fossil fuels is not just normal commerce — it is deeply immoral and unjust, and it is killing people all over the world. Divestment would be not only the right thing to do, but also a highly effective strategy for action on the climate crisis. 

Historically, divestment movements have been a powerful tool for social change, most notably in helping to stigmatize and weaken the Apartheid regime in South Africa. Today, the movement to divest from fossil fuels is gathering momentum, with universities, NGOs, religious organizations, cities, and even countries committing to divest $11 trillion in total. Fossil fuel companies are beginning to feel the impact on their public image and their finances. As an institution globally renowned for shaping the economy of the future, MIT should strive to become a leader of the fossil fuel divestment movement. 

MIT is experiencing a moment of crisis, as the Institute’s acceptance of funds from Jeffrey Epstein has laid bare deep, systemic problems with the way the university finances its activities. Divestment from fossil fuels is a necessary component of any adequate plan for MIT to align its finances with its values. If MIT is serious about financing itself in ways that do less harm to its own community and to the world, it should withdraw its investments from fossil fuel companies and reinvest those funds in clean and renewable alternatives. 

For MIT, divestment would not be an especially difficult or onerous process. MIT has its own investment management company (MITIMCo) and therefore would not have to overcome resistance from a third-party investment management company, as some schools have, in order to divest. Organizations like the Intentional Endowments Network exist specifically to help guide and support universities through the process of aligning their investment strategies with their institutional values. It would be well worth the time and effort for MIT to take a concrete step toward improving its financial ethics and update its investment strategy for a sustainable future. The UC system and many other schools have managed the transition. Surely MIT is no less capable. 

Two weeks ago, the Global Climate Strike brought four million people into the streets around the world to condemn institutional complacency and complicity with respect to the climate emergency. The world has had enough of inaction. The science has been understood for decades. The companies that play the biggest role in driving the climate crisis are known. Divestment provides a clear means to oppose and condemn their destructive practices. MIT should be planning for a decarbonized future, and its investments must reflect that. As an institution proudly committed to science, MIT should do what the data demands: stop supporting climate catastrophe, and invest in a fossil free future. 

Owen Leddy is a first year PhD student in Biological Engineering at MIT and a member of the MIT Divest campaign.