By MARIAH YOUNG
The University of Mary Washington Board of Visitors will not be considering withdrawing investment funds from fossil-fuel profited companies, despite being recommended to do so by DivestUMW, a student group at UMW that promotes the divestment of fossil fuels.
“We are trying to encourage our administration to withdraw some investments from the fossil fuel industry,” senior philosophy major Zakaria Kronemer, a co-founder of DivestUMW said. “We are trying to clean our endowment of dirty energy.”
According to the UMW BOV minutes from the Annual Planning Retreat this August, Jeff Rountree, CEO of the UMW Foundation, reported on the aspects of socially responsible investing.
The minutes stated, “Most investments made by the UMW Foundation are in diverse funds that money managers frequently move around. There are no investments in individual company stocks; thus it would be extremely difficult to isolate from the funds any investments in particular sectors of the economy.”
The student organization met with different members of administration and the BOV throughout last year, but little progress was made, according to Kronemer.
“Toward the end of the year, we realized that we were getting pushed from administrator to administrator, and just getting the same answer continuously, not getting any further,” Kronemer said.
According to University President Rick Hurley, this is not the case.
“Staff from the UMW Foundation met with them, I met with them alone and then again with the Rector of our BOV, plus the chair of the BOV’s Administration and Finance Committee to listen and understand their position,” Hurley wrote in an email. “Finally, a full presentation on the issue was made to the entire Board of Visitors, so I think we have completely and carefully considered the matter.”
Kronemer disagreed. He argued that the university administration does not want to continue dialogue on the matter.
“After the BOV retreat, we received a message from Hurley, essentially saying that they came to a decision not to consider divestment. We replied asking if the door to dialogue is closed, and he confirmed that they do not want to continue negotiation regarding it,” Kronemer said.
Hurley said that continuing conversation would repeat what was already said in meetings. He also said that it is “unlikely that the BoV will be interested in further consideration of this issue.”
Kronemer said students that are part of DivestUMW had about four meetings with Hurley.
“We now have to progress into action based methods of advocacy for divestment,” Kronemer said. “No school has divested purely through the means of negotiation.”
The BOV believes it is in the best interest of the university to continue with the current practice of maintaining school funds as part of a portfolio instead of individual stocks, according to Holly Cuellar, rector of the UMW BOV in an article with The Free Lance-Star.
“While we understand and appreciate the sentiment of the DivestUMW group, the UMW Board of Visitors and the Foundation Board remain focused on prudently maximizing investments to support our donors’ intent to bolster scholarships and programs that enhance the student learning experience,” Cuellar told The Free Lance-Star
According to Kronemer, around 300 other universities have campaigns promoting divestment, and some major schools, such as Stanford University, have made progress.
College and university endowments, overall, represent $1 trillion of $150 trillion total invest assets in the world, according to Cary Kroskinky, executive director of the Network for Sustainable Financial Markets.
At the UMW, the endowment, which is controlled in part by the UMW Foundation, is approximately $42 million. The UMW Foundation is a non-stock, nonprofit corporation chartered by the Commonwealth of Virginia. The goal of the foundation is to “accept, manage and administer private resources supporting the mission and priorities of the university, and to provide opportunities for students and a margin of institutional excellence unavailable with state funds,” according to the Foundation’s website.
Approximately eight percent of companies that are held in various multi-company investment vehicles within the endowment have fossil fuel operations as a part of their overall business.
One major reason for the lack of divestment is that the UMW Foundation does not invest in individual company stock, but instead invests in funds that include in them companies that support the fossil fuel industry in some way, according to Hurley. This approach to investing gives the foundation access to investment vehicles with a higher return rate.
“The BOV believes their responsibility is to support the best possible return on our investments because most of the endowment’s return goes toward scholarship awards for our students – about $1.4 million annually,” Hurley wrote. “The Board is committed to keeping the cost of a Mary Washington education as affordable as possible, and private support generated through endowed scholarships is essential.”
Other universities in Virginia, such as the University of Virginia, Virginia Tech, James Madison University, the College of William and Mary, George Mason University and Old Dominion University all have online petitions to end the fossil fuel investment process.
“To divest, we would have to replace 11 funds of funds that manage 88 percent of the total portfolio and our research has shown that funds established to address this issue do not have the rates of return we enjoy,” said Hurley. “Finally, we have a policy on socially responsible investment so one should not get the impression that all the Board is concerned about is the return on the investment.”
On Sept. 21, members of DivestUMW will be attending the People’s Climate March in New York City. The march is predicted to be one of the largest climate marches in history.