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Dale Wannen headshot

Big Endowments Are Divesting: Are You?

By Dale Wannen

The divestment train has left the station. It’s hard to pass a headline that doesn’t include the words 'divestment' and 'foundation' in the same sentence these days. And rightfully so: As technology and innovation in renewables start to take hold, the good old boys at the coal mining and fossil fuel companies are starting to lose investors. Recent campaigns include:

  • Stanford University, an $18.7 billion portfolio, got out of all coal mining investments.

  • The city of Oakland unanimously approved a measure divesting city funds from all investments in any company whose business is extraction, production, refining, burning or distribution of any fossil fuels.

  • Rockefeller Brothers Fund, heir to the oil tycoon John D. Rockefeller, announced the divestment of fossil fuels in the fund.

The list goes on and on. Somewhat piggybacked nearly 40 years later on the anti-apartheid campaigns of the early '80s, this divestment campaign started a few years back at universities and colleges and has now spread to over 300 college campuses across the country through organizations such as Responsible Endowments Coalition. But it seems as if this divestment movement is taking hold not only with the universities, but also with a number of different institutions, including small and large family foundations and local municipalities. This eventually will trickle down to individual households who have various IRAs, 401(k)s and brokerage accounts. Several steps to help create a personal fossil-fuel free portfolio include:

  • If you own individual stocks, readdress whether or not they are involved in the dirty energy extraction business.

  • Ask your human resources director at work if there are options within the 401(k) or 403(b) plan that take into consideration environmental, social and governance screens.

  • If you work with an investment advisor, simply call them and request to see the holdings and if he or she could discuss how to integrate sustainable and responsible (SRI) principles into your portfolio. If they say something like “Why in the world would you want to do that?," then it may be time to switch advisors.

For big institutions that have a fiduciary responsibility to make money, their divestment from coal and oil is not just coming out of the goodness of their hearts. It is also coming from the fact that this industry may be just unable to compete (like any other industry out there) and because of their duty as board members have to look elsewhere to maximize their profits.

"This announcement sends a powerful message to the fossil fuel industry: if you're going to try and take away our planet, we're going to try and take away your money. We're no longer just playing defense against dirty projects like the Keystone XL pipeline, we're going on offense, too," stated 350.org.

Image credit: Flickr/hampsjpphotos

Dale Wannen is CEO of Sustainvest Asset Management LLC, an investment advisory firm focused on sustainable and responsible investing based in Petaluma CA. He can be reached at dale@sustainvestmanagement.com.

Dale Wannen headshot

Dale is the founder and advisor of Sustainvest Asset Management LLC. He has over 20 years experience in wealth management and financial services with a distinct commitment to sustainable investing for 15 of those years. Prior to Sustainvest, Dale was a portfolio manager specializing in ESG investment strategies and shareholder advocacy. After growing up in southern New Jersey, Dale decided to head west in 2002 and now makes the bay area his home.  He has an MBA in Sustainable Management from Presidio Graduate School in San Francisco and a B.A. in Economics from Rowan University and currently is a volunteer with Mentor Me Petaluma and the founder of Green Drinks Petaluma. He also currently sits as a Board of Director of nonprofit Stewards of the Coast and Redwoods and is a investment committee member of the Sonoma County Community Foundation.

Read more stories by Dale Wannen