By Cleo Shapiro
Editor’s note: In a collaboration with Beacon’s Environmental Justice Club, The Beacon Beat is releasing a series of articles concerning accessible climate action and information for teenagers to encourage students to participate in improving their future and current surroundings one step at a time. It may take some time, but every individual action you choose to take towards being more environmentally friendly allows you to care for your surroundings and future.
In the 1980s, a powerful wave of protests swept across college campuses in the United States, calling for divestment from companies doing business in apartheid-era South Africa. The divestment campaign proved to be a turning point in the South African struggle for human rights and played a crucial role in ending the discriminatory system of racial segregation.
Today, a similar movement is gaining momentum around the world, this time targeting the fossil fuel industry. Environmental advocates are applying pressure on institutions to divest from fossil fuels and invest in a sustainable future. While this movement has gained widespread support, it is not without controversy.
But what is divestment, and why has it become such a powerful tool in the fight against climate change? Does it even work, or is it a performative way for universities to avoid criticism from climate activists?
“Protest divestment is a form of dissent in which stockholders intentionally sell their assets from a corporation. Protesters attempt to force corporations from conducting business with certain companies to enact social change.” states the investopedia definition. At universities and colleges, this typically occurs in the form of grassroots student-led campaigns, by fighting to have universities end financial relationships with these companies.
Although the push for divestment has shown to be impactful in spreading awareness and financially constrains fossil fuel corporations, like any political debate, there are people that do not agree with this initiative. The arguments against the traditional divestment plan are not of those who are climate change deniers or in support of the wellbeing of oil companies, but simply those who believe this is not the best plan of action.
Because many colleges are divesting, critics bring up the idea that those following suit are doing it for financial gain. They are pulling out of the companies before the value of the shares go down, but are claiming it is because they care about the environment. With the rise of Gen-Z’s immense concern surrounding the climate crisis and with social media being the primary platform for the projection of these worries, companies repeatedly extend token initiatives to boost their reputation and approval, and therefore revenue.
Another widely presented viewpoint in the debate against liquidating fossil fuel investment is that by pulling out of the company, a university loses its “seat at the table.” Remaining shareholders gives universities the chance to make use of the school’s voice as a powerful, significant investor to influence the behavior of the corporations to follow a more environmentally conscious way of operations.
In 2013, before the university made the landmark decision to draw out of big oil and coal companies, Harvard’s president Drew Faust released a statement in which she presented the idea that although the institution cares about climate change and had begun to establish sustainability initiatives in response to the protests, they do not believe that it is the correct way of combatting the climate crisis. Faust writes, “Divestment pits concerned citizens and institutions against companies that have enormous capacity and responsibility to promote progress toward a more sustainable future.”
The Harvard administration also argued that a small percentage of the market value of fossil fuel firms is owned by universities, and if Harvard were to sell their shares, there would likely be other eager buyers, both domestically and internationally. No matter who controls the assets, emissions of greenhouse gases are going to persist as long as there remains a market for petroleum and coal.
However, as seen in the divestment movements of the 80s, those who believe divestiture is an impactful method of defiance against big oil companies argue that their goal is not to make a massive financial impact on fossil fuel companies. Instead, their goal is to spread awareness so people begin to view the fossil fuel industry as morally unacceptable– which subsequently leads to bigger impacts. Even the debate on whether or not boycotting certain investments is morally right or makes a difference creates a widespread acknowledgment of a cause because it gets people talking about it. Harvard is a highly- esteemed institution and the tarnishing of a corporation’s reputation by them makes an undoubted impact. As professor and activist Dr. Gay Seidman, who played a key role in the anti-apartheid divestment movement states, “Most divestment activists are not interested in harming their own institutions, but rather seek to stigmatize longstanding business practices or push powerful actors to regulate those activities. Divestment is a tactical weapon, one that aims to call attention to larger issues, redrawing moral lines around acceptable behavior.”
The UN has lent its “moral authority” to the divestment campaign, while the post Apartheid Truth and Reconciliation Commission leader Desmond Tutu has said that “people of conscience need to break their ties with corporations financing the injustice of climate change”, further proving the parallels in these two movements. Although the effect of divestiture on share prices could be minimal, the damage to these companies’ reputations through the broadcasting of their unethical industry can create more financial chokepoints for them. This aligns with Dr. Seidman’s argument that the divestment movements of the anti-Apartheid movement were not necessarily to detrimentally impact the Afrikaner regime, but more so to spark conversation and spread awareness: a means of proliferation that over time was enough pressure to crack the Apartheid system.
Ultimately, regardless of the stance taken, it is clear that divestiture has generated important discussions and debates about the role of the fossil fuel industry in the global economy, and the need for action to address the destruction of our planet. At the heart of the climate change divestment movement is a recognition that the stakes of climate change are nothing less than the survival and well-being of our planet and its inhabitants. With temperatures soaring, sea levels rising, and extreme weather catastrophes becoming more frequent, the urgency of action has never been greater. Whether through divestment or other means, the fight against climate change is one of the defining challenges of our time, and the decisions we make today will shape the future for generations to come.