Friday, April 5, 2013

Swahili Proverb

In Kofi Annan's memoir, Interventions: A Life in War and Peace, I just finished he shares a Swahili proverb worth reflecting on.

     You cannot turn the wind, so turn the sail.
I think the proverb might apply to any number of things (as proverbs do) but I'm thinking specifically of MSU students who have been urging the MSU administration to move away from coal and fossil fuels as the source of powering the university. While their earlier pushing to get off coal likely helped lead to a year long study that created an Energy Transition Plan, they don't see the progress moving at the speed they believe needs  to prevent their future from being fraught with ecological and economic challenges that make our current ones pale. The roughly 30 year lag in the impact of adding more carbon will be felt more by them than by our generation who will mostly be turning to dust by then.

So they have turned their sails to align with the global campus movement to get higher education off the investment side of the fossil fuel industry. The students were interviewed yesterday on public radio, held a press conference and organized a forum last night in hopes to raise the issue of the "mother of all inconsistencies" as Pax World President and CEO Joe Keefe named it in his Connections essay I received in my email yesterday.

Keefe notes earlier in the essay on the question of divesting from fossil fuels that

the flimsy rebuttal we sometimes hear, that an endowment's fiduciary duty means that its only obligation is to maximize return, regardless of the consequences or externalities, is utter nonsense. There is now a substantial body of research underscoring that companies with better environmental performance also tend to enjoy better financial performance. It is ignoring these issues, rather than integrating them, which most likely constitutes a breach of fiduciary duty.

It's worth noting that MSU's endowment of about $1.4 billion is slightly smaller than Pax World's funds under management $1.6 billion. Also that over the past year (2012) MSU's return was 0.5% (from NACUBO study of endowments) while Pax World's was 5.96% (Social Funds website of SRI mutual funds).

As the registered loony tune who has been researching and pushing alternatives to investing in things we don't believe in, I have made almost no progress on my campus in 30 years. We did manage to lobby hard enough nationally to get TIAA-CREF to create a Social  Choice fund alternative some 20+ years ago, but still we have not cracked the credos of finance...the same ones that drive our faltering economic system.
 
UNEP Finance Initiative

There are brighter signals that it is shifting. The UNEP Finance Initiative's Principles for Responsible Investment now has $32 TRILLION under management by signatories of the principles. Higher education endowments are woefully absent from the list of signatories. Yet some schools and major foundations are beginning to see the value in what is sometimes referred to as "mission-based investing".

Higher education leaders must be constructing concrete bunkers to shelter themselves from this global movement. Hopefully these committed students, now active on more than 200 campuses can do what we have so far been unsuccessful in doing thus far. MSU is proud of being a leader in the divestment campaign from businesses in apartheid South Africa. We're hoping we can once again be bold by design. But like that earlier effort, it is driven from the grassroots and we pull the campus leaders along. So be it....