- Harvard University said it will allow investment commitments in the fossil fuel industry to expire.
- Climate change activists have declared victory after pushing the university for years to divest from fossil fuels.
- Legacy investments related to the fossil fuel industry are “in runoff mode,” said Harvard President Lawrence Bacow.
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Harvard’s multi-billion-dollar endowment will end investment in the fossil fuel industry, the university said Thursday, following a lengthy push by environmental activists for the institution to financially divest from assets they say contribute to climate change.
Harvard President Lawrence Bacow in a statement said the Harvard Management Company does not plan to make fossil fuel investments in the future and he noted that Harvard said in February that HMC had no direct investments in companies that explore for or develop further reserves of fossil fuels. HMC oversees the university’s $42 billion endowment and related financial assets.
“Given the need to decarbonize the economy and our responsibility as fiduciaries to make long-term investment decisions that support our teaching and research mission, we do not believe such investments are prudent,” said Bacow.
Bacow said HMC has legacy investments as a limited partner in a number of private equity funds with holdings in the fossil fuel industry. “These legacy investments are in runoff mode and will end as these partnerships are liquidated,” he said, adding that HMC hasn’t made new commitments to the limited partnerships since 2019.
HMC’s indirect investments in the fossil fuel sector make up less than 2% of the endowment.
Fossil Fuel Divest Harvard, a group founded in 2012, has declared victory in its efforts to have Harvard pull its investments in the fossil fuel industry, The Harvard Crimson student newspaper reported.
“So long as Harvard follows through, this is divestment,” Connor Chung, an organizer with Divest Harvard organizer, told the newspaper. “This is what they told us for a decade they couldn’t do, and today, the students, faculty, and alumni have been vindicated.”
Bacow’s statement did not include a timeline for when the investments will expire nor did it include the word “divestment.” Supporters of fossil fuels divestment have filed legal complaints and have gained board seats on school governance boards, according to the Crimson.