Coincidence or collusion? Melbourne, Monash avoid calls for fossil fuel divestment
29th MARCH 2014
A day after an embarrassing leak revealed that Monash University's Chief Financial Officer wanted to pretend it hadn't been asked about its investments in carbon-intensive stocks, University of Melbourne Vice Chancellor Glyn Davis has released a statement resisting calls to divest from fossil fuels.
Mr Davis's statement drew attention to the university's sustainability credentials but argued its hands were tied by commitments to past donors and that getting rid of fossil fuel stocks was financially risky.
However, the leaked email from Monash University's CFO David Pitt suggested that the entire 'Group of 8' have discussed presenting a united front against calls for them to divest, a link strengthened by the timing.
"It could be a coincidence, but it certainly looks like collusion," said Fossil Free Melbourne University lead campaigner Vicky Fysh. "It's disappointing that Melbourne University can't bring itself to lead on this issue. The university can't live up to its own press when it comes to climate change."
Melbourne University professor and IPCC author David Karoly was quick to point out inconsistencies in Davis's statement.
"The University of Melbourne and all universities should divest from fossil fuels because fossil fuel assets are over-valued and pose a threat to these universities' investments. Universities present themselves as leaders in sustainability through research, innovation and campus sustainability initiatives, yet continuing to invest in fossil fuels sends the wrong message. They are more than happy to talk the talk but they also need to walk the walk."
"On the one hand Melbourne University has invested real time, effort and money in its sustainability commitments," said FFMU member Noah Beecher Kelk. "Yet they seem to forget that when it comes to where their money sits. It's short sighted and risky."
The Fossil Free Melbourne University campaign, active on campus for the last eight months, argues that investments in fossil fuels are both financially riskier than markets are accounting for, and unethical given fossil fuels are a major contributor to dangerous climate change.
"Mr Davis writes as though shedding fossil fuel investments is risky," said Miss Fysh. "It's a common misunderstanding, but the research shows the risk is all on the other side."
Recent modelling done by Investment Management Firm Aperio Group suggests that screening out fossil fuel extraction and downstream industries from Australian investment portfolios can have negligible impact on returns. At the same time, think thank the Carbon Tracker Initiative are warning of stranded fossil fuel assets and a carbon bubble, should investors like the University of Melbourne continue to invest unabated in fossil fuel reserves that are unlikely to be burnt in a carbon-averse world.
“It is time for Melbourne University to show students, staff and the wider community that they are really committed to climate change abatement by divesting from fossil fuels” concluded FFMU Communications Director Josie Ryder.
To see the Aperio Group modelling, see this report.