Ben Gurion University withdraws oil and coal investments

Ben-Gurion University of the Negev is the first academic institution in Israel to commit to divert its investments from oil and coal due to their impact on the climate crisis. The university is also committed to managing its investments using investment tools in line with ESG (environment, society and governance) principles, while increasing investment in renewable energy.

The university’s executive committee made this decision after carefully reviewing its investment portfolio, totaling NIS 3 billion, over a period of one and a half years, in response to increasing demand from scientists who insist that academic institutions should act in a manner covering recent findings on the climate crisis.

The university is now mapping out all its investments to determine how much it will cost to divert investments. First, investments will be diverted from companies focused on oil and coal production. Gas investments will also be considered at a later stage.

“At this point, we have instructed the investment committee to come up with a detailed plan outlining how and within what timeframe, using substantial milestones, we can change our investment mix,” said Yarom Ariav, Chairman of BGU’s Executive Committee and former Director General of the Ministry of Finance.

“In about three years we will see a substantial change in our investment portfolio. We will stop investing in fossil fuels and start managing the investments according to the ESG policy. Our first step will be to refrain from investing in oil and coal companies, and we will also gradually move to redirect gas investments.As an economist, concerned with the future of this planet, I think this is the right path.Research shows that profits have not been affected by companies that have ESG policies assumed “It is an economic and moral statement. Climate change affects us every day, without us realizing it. We need to take action as part of good economic policy,” Ariav said.

Other universities still haven’t made the decision

So far, other Israeli universities, which receive donations from the fossil fuel industry and polluting companies, are refusing to comply with demands from students and senior researchers to reexamine their investment policies in this area. At the same time, in the past two years, universities around the world have begun to commit to adapting their investment mix to increasing climate risks. For example, Harvard University (the richest university in the world) has announced that it will no longer invest in fossil fuels, as ‘climate change is the greatest threat facing humanity today’. Oxford, Brown, Cornell and other universities have followed suit.

In Israel, Ben-Gurion University established the School for Sustainability and Climate Change in March 2021. Researchers from the school will focus on desertification, energy and sustainability, examining climate change in a desert context, while collaborating with researchers around the world.

As a next step, BGU chairman Daniel Chamovitz says that the BGU investment decision fits perfectly with BGU’s principles. “It is not enough to establish a school for sustainability and climate change,” he says. “When you make a decision, you have to stand behind it at every level. Ben-Gurion said we must act with determination and courage, and this is what we are doing. Coping with climate change is a challenge that affects all of us. We must paving the way for change You can’t just say, “It’s impossible!” As our own researchers investigate how climate change affects public health and how systems on the planet are changing due to human activity, then we need to take action accordingly.”

BGU’s change in investment policy will result in the diversion of millions of shekels, initiated by the BGU president and faculty members of the “Green Campus” climate team. “Investment committees are very conservative by nature,” says Prof. Chamovitz, “In the beginning people were skeptical. But we showed them what is happening in the world. We showed them that there is no contradiction between profit and changing investment policy. You have to say to yourself: for any amount we lose, money is not everything. Money is a means, not an end. Yoram Ariav spoke with the members of the investment committee, and we brought in investment experts and carefully examined the situation We know that the era of fossil fuels will not end tomorrow, but we must stick to our principles.”

Not meeting climate targets

Scientists from the UN’s Intergovernmental Panel on Climate Change (IPCC) warned in a report released last week that, contrary to statements from politicians around the world, humanity is failing to deal with greenhouse gas emissions. For the planet to warm by just 1.5 degrees — a temperature considered safe for humanity, greenhouse gas emissions must be halved by the end of the decade and zero by the end of the century. However, based on current commitments, gas emissions are expected to rise by 14% by the end of the decade and temperatures to rise by 3.2 degrees to an extremely dangerous threshold by the end of the century.

Members of BGU’s Green Campus initiative praised the executive committee’s decision. dr. Avner Gross, head of the climate team and member of the School for Sustainability and Climate Change, says that “even if we completely stop using fossil fuels in the coming decades, the global temperature will still rise by three degrees. catastrophic warming that humans have never experienced since they first started living on Earth. To avoid catastrophic warming, by the end of the decade, 88% of our energy consumption on this planet must come from non-fossil sources: the use of coal must be reduced by 95%, oil by 60% and gas by 45% by 2050. Therefore, diverting investment from fossil fuels and investing money in climate solutions are extremely important steps towards solving the climate crisis. “

dr. Nir Barak of the Ministry of Politics and Government, who studies environmental politics in cities, says that politicians have so far failed to deliver on their commitments, which is why universities and organizations that manage investments are playing an important role in this effort. “For too many years we have seen how helpless countries are in promoting effective climate change mitigation and adaptation policies,” he says. “During my research, I discover that cities around the world are taking the initiative and creating alternative paths of action. More cities are diverting investments from fuels: New York, Paris, London, Berlin, Copenhagen, Rio de Janeiro, Cape Town, and others. and universities cannot replace countries, but these kinds of organizations can indicate the type of change that is needed.”

The “Clean Money” forum called on BGU to add clear targets to their gas diversion investments. Gas is made up of methane, a greenhouse gas 84 times more potent than carbon dioxide and responsible for more than a third of global warming. The Forum congratulated BGU on their decision to divert investment from fossil fuels and lead this agenda in Israel. However, they were disappointed that the university chose to separate gas from other fossil fuels: “We call on the university to rise to the challenge and join the 178 leading universities in the world and divert investment from all carbon, oil, etc.”

Published by Globes, Israel business news – en.globes.co.il – on April 11, 2022.

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