Cambridge University to divest £3.5bn fund from fossil fuels as part of net-zero ambition
The University of Cambridge will divest its £3.5bn endowment fund from fossil fuels by 2030, as part of a wider plan to reduce the University's emissions to net-zero by 2038.
The £3.5bn Cambridge University Endowment Fund is one of the largest in Europe. The University has finally agreed to divest the fund from oil and gas companies following years of protests from students and campaigners.
The University will withdraw all investments with energy-focused public equity managers by the end of the year. Following that, a five-year programme will be introduced to ramp up significant investment into renewable energy. By 2030, all meaningful exposure to fossil fuels will have been divested.
The divestment forms a key part of the University’s ambition to reduce emissions across its entire portfolio to net-zero by 2038 – well ahead of the UK Government’s national legislation, set for 2050.
Professor Stephen J Toope, Vice-Chancellor, said: “The University is responding comprehensively to a pressing environmental and moral need for action with a historic announcement that demonstrates our determination to seek solutions to the climate crisis.
“We will approach with renewed confidence our collaborations with government, industry and research partners around the world as together we work for a zero-carbon future.”
In July 2019, the University of Cambridge became the first higher education institution in the world to set science-based targets in line with the Paris Agreement’s more ambitious 1.5C trajectory.
Under the new targets, the University has committed to reduce its Scope 1 (direct) and Scope 2 (energy-related) carbon footprint by 75% by 2030, against a 2003 baseline. It has also pledged to bring its Scope 2 carbon emissions down to zero by 2048.
That came shortly after the University’s management accepted a motion, to outline the advantages and disadvantages that divestment from oil and gas companies would bring.
Earlier this year, Oxford University announced that was divesting its remaining investments away from fossil fuel companies and how its fund management service can engage with organisations that showcase net-zero business plans.
Oxford University has asked its endowment office, Oxford University Endowment Management (OUem) to engage with fund managers to request evidence of net-zero carbon business plans across their portfolios. OUem will also divest the university’s investments, totalling more than £3bn, away from fossil fuels.
OUem has already shrunk the amount of money it invests in the energy sector from 8.5% in 2007 to 2.6% currently. This largely consists of renewables and just 0.6% of the endowment is now in fossil fuel organisations.
The University of Liverpool has committed to removing fossil fuel investments from its portfolio, while Goldsmiths, University of London, has pledged to divest its endowment fund entirely from companies which generate more than 10% of their revenue from fossil fuels. This decision was taken by the facility’s new warden Professor Frances Corner, who has also banned beef from campus food outlets and introduced a 10p levy on plastic water bottles.
Nonetheless, the UK’s higher education sector is still estimated to hold £1,804 in oil and gas stocks for every student in the system – of which there are estimated to be 2.25m.
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