The University of Toronto has become the latest institution to commit to the divestment movement, saying Wednesday that it will sell off all fossil fuel investments in its $4 billion endowment fund by the end of 2030 to help fight climate change.
The commitment includes divesting from all direct investments in fossil fuels companies within the next year, divesting from indirect exposure to fossil fuels through things like pooled investments by 2030, and reaching a net-zero portfolio by 2050.
The announcement by University of Toronto president Meric Gertler comes after he rejected a call in 2016 for the university to divest, saying at the time that the university would focus on pushing for better carbon disclosure and encouraging companies to reduce emissions.
Gertler said in a letter to the university community that it’s time to do more.
“The growing severity of the climate crisis now demands bold actions that have both substantive and symbolic impact.”
The university’s decision to go beyond investor activism toward an outright sell-off of fossil fuel assets comes amid a wave of divestment commitments globally.
On Tuesday, Dutch pension giant ABP said it would sell off all of its fossil fuel assets, worth some 15 billion euros, because it didn’t see enough opportunity to push those companies towards sustainable practices fast enough. The pension fund said it would instead work to influence companies that use fossil fuels such as utilities, the auto industry and aviation.
Caisse de depot et placement du Quebec, Canada’s second-largest pension fund manager, made a similar commitment last month.
Harvard University also committed in September to divesting fossil fuels from its US$42 billion portfolio, while a smattering of Canadian universities including UBC, University of Guelph, and Concordia University have already made commitments.
Overall, there are about 1,485 institutions representing US$39.2 trillion in assets under management that have committed to some form of fossil fuel divestment, according to a report out Tuesday by a coalition of advocacy groups.
Critics of the movement say energy producers need capital to transition towards more sustainable practices, that divestment will do little to impact global demand for fossil fuels, and that it will push production towards countries and producers with lower environmental standards.
The University of Toronto’s decision to sell off fossil fuel companies affects about 1.6 per cent of its endowment, as the university has already been working to reduce its exposure to the sector.
© 2021 The Canadian Press