Cambridge to divest from fossil fuels with ‘net zero’ plan

The University of Cambridge aims to divest from all direct and indirect investments in fossil fuels by 2030 as part of the University’s plan to cut its greenhouse gas emissions to zero by 2038, more than a decade before the date set by the UK Government.

The £3.5 billion Cambridge University Endowment Fund – one of the biggest of its kind in Europe – intends to ramp up investments in renewable energy as it divests from fossil fuels.

This latest plan puts Cambridge at the head of the race to become the first university endowment of its kind where greenhouse gas emissions from the activities of all investments balance out at zero.

Announcing the move in his annual address to the University on Thursday, Professor Stephen J Toope, Vice-Chancellor, said: “The University is responding comprehensively to a pressing environmental and moral need for action with an 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.”

The step-by-step changes – which the University hopes will inspire other institutions – will see the CUEF:

• Withdraw investments with conventional energy-focused public equity managers by December 2020
• Build up significant investments in renewable energy by 2025
• Divest from all meaningful exposure in fossil fuels by 2030
• Aim to achieve net zero greenhouse gas emissions across its entire investment portfolio by 2038, in line with the broader targets of the University.

Chief Investment Officer Tilly Franklin said: “Climate change, ecological destruction, and biodiversity loss present an urgent existential threat, with severe risks to humankind and all other life on Earth. The Investment Office has responded to those threats by pursuing a strategy that aims to support and encourage the global transition to a carbon-neutral economy.”

The University Council has endorsed this strategy to position Cambridge as a leader in research into practical and scientific climate solutions, an investor pressing for sustainable long-term portfolio management and an adviser to industry and government on climate policy.

The University also announces that all research funding and other donations will from now on be scrutinised to ensure that the donor can demonstrate compatibility with the University’s objectives on cutting greenhouse gas emissions before any funding is accepted.

The University is committed to using its resources to support the global response to climate change and the wider United Nations’ Sustainable Development Goals.

Council also warmly welcomed a report on the advantages and disadvantages of divestment by Cambridge academic Dr Ellen Quigley, researcher Emily Bugden and Anthony Odgers, the University’s Chief Financial Officer. The report noted broad agreement in the University on the urgent need to reduce carbon emissions and explored divestment across moral, social, political, reputational, and financial dimensions.

Students and staff have contributed to the divestment decision by keeping the issue on the agenda over several years.

Ben Margolis, Undergraduate President of the Cambridge Students’ Union, said: “This is a landmark decision for which students, staff and the Students’ Union have been campaigning for years. The divestment report presents overwhelming evidence that the fossil-fuel industry’s practices are not compatible with the University’s position as a world-leading site of scientific research, or its stated mission to contribute to society. The report points out the importance of divestment for frontline communities who are damaged by past and continued extraction by these companies. We hope that other institutions join us in divesting and take firm action in the face of the climate emergency.”

This package of measures backs up the University’s climate change initiative Cambridge Zero, which aims to use its world-leading teaching, research and vast network of global collaborations to influence urgently needed systemic change.

Cambridge Zero Director Emily Shuckburgh OBE said: “These announcements put Cambridge at the forefront of the Race to Zero, the global alliance committed to rapidly reaching net zero emissions, and hopefully it will inspire many others to join in the ambitious climate action in the lead up to the UK hosting COP26 in 2021. More broadly, Cambridge Zero aims to catalyse a revolution that creates a positive future with a sustainable, resilient, fair and equitable zero-carbon world.”

The Investment Office will work with Cambridge Zero and the Cambridge Institute for Sustainability Leadership to offer external fund managers access to high-quality research and advice on sustainable finance, starting with its partners who collectively have more than $250 billion (£190 billion) under management.

On its own estate, Cambridge was the first university to adopt a 1.5 degrees Celsius science based target for emissions reduction, with an ambition to cut energy-related emissions to zero by 2038. As part of that, Cambridge is looking into replacing gas with the large-scale use of alternative heat technologies and increasingly sourcing its power from renewable sources.