As Students on a Warming Planet, We Demand to Know: Which Side Are You On?

Last Monday, six members of Swarthmore's Board of Managers again failed to take leadership on the climate crisis and divest from fossil fuels. With a majority of the student body and nearly half of the faculty calling for divestment, we proposed that Swarthmore commit to achieving a fossil-free endowment by 2020, the same year that global emissions must peak if we are to avoid catastrophic climate change. Despite this mandate from the Swarthmore community, these six Board members turned their back on our generation - and chose to side with a rogue industry.

Last fall, the UN Intergovernmental Panel on Climate Change released its starkest report yet, warning of "serious, pervasive, and irreversible" climate change if the world burns more than than roughly 465 gigatons of carbon. The fossil fuel industry plans to burn over five times that much, putting the planet and our future on path for a calamitous six degrees Celsius of warming. Their business plan is incompatible with a just and sustainable world. From New Orleans to the Philippines, those least responsible for the the crisis are being hit hardest. With our future hanging in the balance, how can our College choose to invest in and legitimize this industry?

One of the most powerful opponents of divestment at Swarthmore is Investments Committee Chair Chris Niemczewski. Mr. Niemczewski is the founder and President of Marshfield Associates, Swarthmore's third-highest paid investment advisory firm, and he retains between 25% and 50% of the company's stock. Mr. Niemczewski has a clear interest in ensuring that Marshfield can continue managing a portion of Swarthmore's endowment - but Marshfield Associates does not offer fossil fuel free investment strategies. This conflict of interest may cloud the reliability of the Board's decision-making.

If the Board accepts our proposal to divest the endowment by 2020, Mr. Niemczewski must either adapt Marshfield's strategy to accommodate fossil free investment opportunities, or he must end Swarthmore's investments with Marshfield. To justify the College's refusal to divest, Mr. Niemczewski issued a deceptive report claiming that fossil fuel divestment would require shifting our entire endowment from actively-managed funds to index funds. The assumptions of this report are false and Mr. Niemczewski knows better. While some some managers, including Marshfield, do not currently offer fossil free investment opportunities, a growing number of commingled fund managers do: the use of sustainable, responsible, and impact investment strategies grew by over 75% between 2012 and 2014.

As a financier, Mr. Niemczewski must know that a growing number of investment leaders are recognizing the risks posed by the climate crisis and unburnable fossil fuels. HSBC investment bank estimates that if governments follow through on international agreements to keep warming below 2 degrees Celsius, the fossil fuel industry will lose $20 trillion in assets and their companies could be devalued by up to 60%. The increasing recognition of the risks posed by this 'carbon bubble' have led to rapid shifts in the financial community, including the announcement by Cambridge Associates, which advises 71% of US college endowments worth over $1 billion, including Swarthmore's, that it will help institutional investors identify actively-managed, fossil-free funds.

Yet, in Monday's negotiation, we were astonished and deeply disturbed when members of Mr. Niemczewski's Investment committee again rejected the growing consensus that the carbon bubble presents serious risks to investors. While Mr. Niemczewski's committee refuses to protect our endowment from the carbon bubble, an unprecedented chorus of financial leaders, ranging from Bank of England Governor Mark Carney to billionaire investor Tom Steyer, are sounding the alarm on the risks of unburnable carbon. Former SEC Commissioner under Ronald Reagan, Bevis Longstreth, argues that the top 200 fossil fuel stocks are "severely overpriced in the market" and thus colleges and universities have "a compelling reason on financial grounds alone to divest these holdings before the inevitable correction occurs" and the carbon bubble pops. UK Energy Secretary Ed Davey warns that fossil fuels could become the "sub-prime assets of the future." UN Climate Chief, and Swarthmore alumna, Christina Figures calls continued investments in fossil fuels a "breach of fiduciary duty." It is not a question of whether we will transition to a low-carbon society in which fossil fuel companies cannot burn through their reserves, Figueres notes, but a question of whether we transition "because nature will force us, or because policy will guide us." But these warnings fall on deaf ears: Mr. Niemczewski's Investment Committee maintains that all is well, that fossil fuels are not overpriced, and that stranding 80% of reserves in the ground poses no risk to our endowment.

While fossil fuel divestment enters the financial mainstream, Mr. Niemczewski and his committee continue to obstruct progress at Swarthmore and violate our College's Quaker values: social responsibility, leadership for the common good, and truthful dialogue. The Board of Managers has failed us repeatedly. They took too long to divest from South African apartheid, and once again they are on the wrong side of history. As students, we cannot stand idly as Mr. Niemczewski and his committee prevent Swarthmore from aligning our investments with our values and taking leadership on climate change. By investing our $1.8 billion endowment in fossil fuels, Swarthmore is saying this industry's business model is compatible with our values of social justice and sustainability. This is the wrong message being sent at the worst time. The next five years are pivotal ones for ensuring the survival of our generation; the window for action is closing rapidly.

The odds are against us. The fossil fuel industry is one of the most powerful and profitable industries in modern history. Every institution has a responsibility to maximally leverage their resources to promote action to best ensure a livable planet. In particular, institutions of higher education must ensure that their students have a future in which to flourish. It is unconscionable for our college's and universities to invest in the very companies that are recklessly endangering our future. On February 13th and 14th thousands of students around the world will rise up for Global Divestment Day and ask our colleges and universities: which side are you on?