Finding the Courage to Invest in Our Futures

On Sept. 9, 2020, we woke up early. It was Sanchali’s birthday. Instead of the clear blue skies we’ve come to expect in Oakland, we found a dark, orange-tinged glow. The sun didn’t rise that day. It would be the first of 10 days of smoke-filled skies caused by the raging wildfires across the American West.

As two Princeton alums who started dating in college, our years after school were filled with adventure, ambition, and joy. We lived in New York, then chased our dreams to work in East Africa and India. We attended graduate school in Boston, and surprising none of our college friends, got married. But over the last several years, the urgent threat and injustice of climate catastrophe have become a driving motivation for us. We pivoted our careers into climate, continuing a journey that started on Princeton’s campus, where we first learned about climate change.

At Princeton, too, the community is taking notice. Last year, a group of undergrads, graduate students, and alumni came together to form Divest Princeton. In some regards, the University has been a leader on climate change. However, we fall short in one notable area: management of the $26.1 billion endowment.

We believe divestment from fossil fuels is not only in the University’s best interests — it is the only path that reduces exposure to long-term climate and financial risk. For Tiger alumni, urging our alma mater to divest may be one of the most impactful actions we can take to ensure a just and sustainable future for the next generation.

First, there is a strong financial argument to invest in a fossil-fuel-free portfolio. Global stock indexes without fossil-fuel holdings outperform identical indexes that include them. As reported by The Guardian in 2018, “investors who divested from fossil-fuel companies would have earned an average return of 13 percent a year since 2010, compared to the 11.8 percent-a-year return earned by conventional investors.” Princeton’s return on its endowment was estimated at 12 percent per year over the 25-year period ending June 30, 2019.

The University of California divested from fossil fuels last year, citing financial imperative: “The reason we sold some $150 million in fossil-fuel assets from our endowment was the reason we sell other assets: They posed a long-term risk to generating strong returns for UC’s diversified portfolios.” Investing in fossil fuels is fiscally irresponsible.

Second, divestment is an effective tactic. In the cases of South Africa’s apartheid government and the tobacco industry, divestment played a significant role in creating the popular opposition that contributed to their decline. Analysts at Goldman Sachs have already stated that the “divestment movement has been a key driver of the coal sector’s 60 percent de-rating over the past five years.” Shell considers divestment a “material risk” to its business.

Universities are uniquely positioned to take a stance on divestment. They are creators of knowledge, protectors of truth, and inventors of the future. Many universities have divested, including Stanford, the University of California, the University of Massachusetts, Middlebury, and Cambridge University. Princeton carries outsize weight both through its endowment — one of the five largest in the world — and through its brand and policy influence. If Princeton chooses to take a symbolic stance on the issue of fossil fuels, that stand will have outsize influence.

Opponents of divestment cite the argument that universities can more effectively influence fossil-fuel companies as a major shareholder. Our response is simple: Princeton has invested in fossil fuels for the past several decades. How effective has its influence been so far?

Third, and most importantly, there is a moral leadership argument for divestment. Investing the endowment in fossil fuels is a direct and serious violation of our alma mater’s values. Fossil-fuel companies deliberately spread misinformation that contradicts the scientific consensus and perpetuate products that cause death and destruction for people and habitats around the world. There is no doubt that climate change is a violation of the nation’s best interests, and the interests of all nations.

Opponents of divestment often cite the “slippery slope” argument: If the University divests from fossil fuels, it will have to divest from guns, alcohol, and every other potentially unsavory sector. While no investment strategy is perfect, some are more destructive than others. Princeton faces reputational risk if it does not take a stance on the most important issues of the generation it purports to educate. We believe this applies to divesting from fossil fuels as well as to divesting from private prisons.

As Princeton, we have a moral window in which to define the future we are courageous enough to invest in, not simply the risks we should divest from.

No one at Princeton taught us that leadership would be easy. The interests that drive the fossil-fuel industry are embedded in the University and will not disappear without a fight. For instance, between 2015 to 2020, Exxon Mobil donated $6.4 million to the Andlinger Center for Energy and Environment at Princeton; in July, the University renewed its collaboration for another five years.

President Eisgruber ’83 wrote in 2017, in response to a petition to divest from private prisons, that Princeton will divest if there is sustained campus interest, if there is consensus on the University’s response, and if the target corporations’ actions are a “direct and serious violation” of a “central University value.” It seems that to convince President Eisgruber that Princeton should divest from the companies causing the greatest threat to human civilization, we must demonstrate sustained, passionate commitment. We, Princeton’s 91,000 living alumni, comprise a major interest group for the University. Together we represent over $1.4 billion in cumulative donations, with nearly $70 million in 2019 alone; moreover, we embody the reputation and legacy of the University around the world.

If you have been on the fence about divestment, the overwhelming events of recent months make it clear: We have no time to waste. Fires, floods, pandemics, and drought are accelerating.

Voice your support for fossil-fuel divestment by signing and sharing this letter and committing to withhold donations until Princeton divests. Already, more than 1,500 students and alumni, 45 faculty and staff, and 40 campus groups have signed on. By Dec. 31, we seek to have 2,500 signatures to present to President Eisgruber before the Council of the Princeton University Community considers Divest Princeton’s official fossil-fuel divestment request in spring 2021.

The bottom line is this: Our actions speak louder than words. We cannot educate our students on the dangers of climate breakdown while we invest in the very fossil fuels that threaten their future. We impel our university to invest in a thriving planet for us and for future generations.