Australian universities have been quick to promote their commitment to sustainability, but slow to divest their fossil fuel investments and take a strong stance on climate change.
This places them behind faith organisations, not for profits, local councils, banks, superannuation funds and a host of others moving capital away from fossil fuels.
Why is this?
Strong links to the mining sector have put universities in a difficult position.
They are conflicted between climate concerns and the income they derive from vested interests with big mining companies.
While many Australian universities engage in the climate change debate, their commitment to divestment has, at best, been minimal.
Divestment involves the withdrawal of capital by public and private investors in response to unethical business interests or practices.
By divesting in this way, universities would be taking a moral and political stance.
To understand why Australian universities are reluctant to divest fossil fuels, it is useful to examine the impact big mining has on university life, policy decisions, research integrity and academic freedom.
Australian universities, from all tiers, often have deep-seated links to fossil fuel mining. These range from training agreements, to research centres funded by donations from multi-national mining companies.
This is a significant dimension of the increasing privatisation of Australian universities, which may be stopping climate change action.
While there are “fossil free” campaigns at at 15 major Australian universities, no university has committed to completely divesting their interests in fossil fuels, and just two have committed to a partial divestment.
In 2014, the Australian National University (ANU) announced a partial divestment amid much controversy. This year, Sydney University, in response to pressure from its students and staff, announced that it would reduce 20% of its fossil fuel portfolio over a three-year period.
Strong reactions to ANU’s divestment from then Prime Minister Tony Abbott, and Finance Minister Joe Hockey, highlight the power of the mining sector in Australian public life.
The launch of Bill McKibben’s 350.org fossil fuel divestment campaign in 2012 has been instrumental in the global roll out of fossil fuel divestment.
The movement is said to be the most effective divestment movement ever, exceeding the tobacco campaign in public support.
Arguments around the economic, environmental and reputational risks associated with fossil fuels align investments of coal, gas and oil with the “sin stocks” of tobacco, alcohol, vice and weapons.
There is a moral element to profiting from the destruction of the planet, but there is also an increasingly strong economic argument against fossil fuels.
Climate projections, and international agreements not to exceed a two degree centigrade temperature rise, have led to concerns about “unburnable carbon” and the potential for coal, gas and oil assets to be “stranded”.
This means fossil fuel assets may lose economic value prior to their depletion, layering a financial imperative to divest on top of a moral one.
Universities’ engagement in the divestment debate
Go Fossil Free, a branch of 350.org, has been active in raising awareness on campus and challenging universities to divest.
Globally, more than 30 educational institutions, including Oxford and Stanford, have publicly announced their divestment in fossil fuels.
Some Australian universities have released statements regarding their investments, but at this stage without commitment to divest.
For example, the University of Melbourne’s draft charter states that the university will:
strategically focus investment priorities on sectors and organisations that lead in the delivery of a low carbon and ethically sound future, while ensuring the University’s long-term financial position.
Queensland University of Technology, in a letter to Fossil Free QUT, campaigners explained that:
QUT is undertaking a review of its investment strategy, which will include consideration of the mix of fossil fuel and carbon intensive assets within the universities management funds.
Whether these responses represent the beginnings of a process of divestment is unclear.
The extent to which big mining has penetrated university life and impacted on administrative decisions as well as research integrity and academic freedom, points to the growing effects of an increasingly privatised higher education sector.
Carol Richards will be discussing the issues raised in this article at the Challenging the Privatised University conference on November 23-24, 2015.