Can U of G become an international leader in sustainability?
Student activists from Fossil Free Guelph (FFG) led a march across campus on Thursday, April 6 to submit a special action policy (SAP) asking the University of Guelph’s board of governors to divest in fossil fuel companies.
FFG believes there are discrepancies between the University’s green image and initiatives and the investments that are being made. The activist group is now taking direct action to ensure student voices are being heard.
FFG members marched through campus, past the library, and into Branion Plaza chanting in the rain: “One: we are the students. Two: we want divestment. Three: we will not stop until we see divestment.”
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Once they arrived at the University Centre, the group accumulated a crowd of 40 or 50, continued chanting defiantly, and marched towards the secretary’s office on the fourth floor.
“We could’ve very quietly submitted this, but we chose to make this a very public event with the explicit purpose of involving students and making them aware that this process is going on,” Emily Martin, a student leader in FFG, said in an interview with The Ontarion.
For the SAP to reach the board of governors, members of FFG had to accumulate at least 20 signatures from three of the four stakeholder groups. The stakeholders include students, faculty, staff, and alumni.
FFG collected over 400 signatures in total and invested over 100 combined hours of research work into the University’s investments, according to Martin.“That labour is unpaid student labour. The University could be having their investment team doing this research,” said Martin.
Late in 2016, students at the Université Laval called upon their school’s administration to align its green image as a sustainable leader with its investments. This February, Laval answered this call and became the first Canadian university to commit to full divestments from fossil fuels.
Prior to Laval answering the students’ push for divestment, schools such as University of Toronto, University of British Columbia, Simon Fraser, and the University of Guelph opted for an Environmental, Social, and Governance (ESG) responsibility stance on investments.
The University of Toronto is one of the institutions that is currently choosing not to pursue divestment.
“The challenge with fossil fuels divestment is that it only addresses—at most—one-quarter of Canada’s greenhouse gas emissions,” Marc Gertler, president of the University of Toronto, said following the rejection of divestment from the advisory committee.“If we’re serious about addressing climate change, we need a strategy that alters behaviour and encourages more progressive practices across the entire economy and society.”
Currently, the University of Guelph’s board of governors has not discussed divestment from fossil fuels directly, but has looked into “responsible investing” as outlined by an ad hoc working group on responsible investing (WGRI) in April of 2015.
“We haven’t taken a position for or against investing in fossil fuels,” said Don O’Leary, U of G’s vice-president of finance, in an interview with The Ontarion. “Responsible investing emphasizes the importance of ESG—that is the mantra to how we are going to make decisions [on] sustainability,”
The ESG initiative weighs all investments under the microscope of environmental, social, and governance responsibility. These schools would then decide if certain investments are environmentally and socially responsible, while balancing with the responsibility to stakeholders to create profit.
“There has to be a balance here between the University’s vision and values, and stakeholder vision and values,” said O’Leary. “Part of those values have to also include some fiduciary responsibility because those endowments are creating scholarships and those sort of things. We have to be able to generate funds to be able to do that.”
The University of Guelph currently holds shares in companies such as Nestlé (25,000 shares), EXXon (4,000 shares), and companies known for fracking on the Canadian oil sands (100,000 shares).
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The SAP submitted by FFG required that students prove that certain companies that the University of Guelph currently holds shares within meet the criterion for the definition of “social injury,” as outlined in the University’s policy.
“Social Injury: the injurious impact which the activities of a company are found to have on consumers, employees, or other persons, particularly including activities which violate, or frustrate the enforcement of, rules of domestic or international law intended to protect individuals against deprivation of health, safety, or basic freedoms.”
When asked for a more precise definition of social injury, O’Leary said, “Harm to the environment is one thing, for sure. We know companies that know they do things they shouldn’t be doing and we know companies that do everything that they are supposed to do. But, even at that, it’s harmful.”
The student activists questioned the University’s commitment to ESG responsibility due to their investments in companies such as EXXon, which actively funds climate change denial. FFG also outlined Canadian Energy companies encroachment on Indigenous sovereignty.
“A lot of those companies end up building their infrastructure in places of marginalized Indigenous communities [that] directly participate in environmental racism—places like in Chemical Valley in Sarnia,” Ben Stuart, a student leader, said in an interview with The Ontarion.
The University of Guelph currently holds approximately 26,000 shares in Suncor, 14,000 shares in Imperial Oil, and 1,000 shares in Dow Chemicals. All three of these companies operate within the Chemical Valley.
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Part of the difficulty in divesting for the University is the way in which the investments are handled. The board of governors’ finance committee hires 11 managers who then take investments and invest them into pool funds.
The University’s financial managers then group and intertwine the University’s investments with their other clients creating a larger pools of investments that are distributed in different sectors.
“We don’t try to direct [the financial managers] in terms of their investment strategies,” said O’Leary. “We do expect from our managers, as a result of this [responsible investing] process, that they will be managers that will respect the ESG.”
O’Leary also noted, “If you’re in the Canadian market, it’s hard not to be invested in the energy sector.”In September 2016, the WGRI provided a status on the implementation of recommendations. Currently, the “assessment of current endowment fund managers” is in progress, as well as an “impact investment fund” that “dedicates a portion of endowment assets to investments associated with the well-being of communities and/or the environment,” according to the WGRI.
“We’ve given the University a softball—a really easy way for them to say, ‘Hey, we’re going to be [sustainable] leaders by just making this one simple decision,” and all they have to say is yes,” said Adrien D’Alessandro, an FFG student leader. “If they say yes, they will get international spotlight and they will actually look meaningfully green on the international stage.”
When asked in how many years the University can expect to be fully divested from fossil fuels, O’Leary said, “That’s a good question because, as the world marches along, things have to change. I can’t answer it, but things do have to change.”
The board of governors have six months to respond to the SAP submitted by FFG. Until then, the University will continue working towards its ESG considerations.
Photo by Matteo Cimellaro.