University of Guelph divests fully from fossil fuel companies

The University of Guelph has accomplished a task that was five years in the making by completely divesting from fossil fuel companies.

In April, the university's Board of Governors officially cut ties with all assets that come from companies holding fossil fuel reserves and subsequently reduced the carbon emissions associated with buying into these companies. 

In a release sent out by the school last Thursday, Sharmilla Rasheed, the vice-president of finance and operations, spoke about the need to maintain a "strong, diversified portfolio" while also meeting sustainability goals. 

"We are committed to managing the university's investments in a way that both safeguards our financial future and upholds our institutional commitment to building a sustainable tomorrow," Rasheed said. 

In April 2020, U of G committed to divest from ownership of fossil fuels after hearing from students, university administration and the board's finance committee. According to the release, an analysis found that "this shift would not impact performance if done prudently and over several years."

In doing so, the school closes the chapter on a battle hard fought and ultimately won by student-led initiative Fossil Free Guelph. The group held rallies and sit-ins to protest what was, at the time, the university's $33-million investment in over 50 fossil fuel companies. 

CBC News contacted Fossil Free Guelph for comment but they did not respond in time. 

What is an investment portfolio?

Most, if not all universities have what's called an endowment portfolio investment fund made up of accounts used for student assistance, research, strategic initiatives, equipment, library acquisitions and some faculty positions. 

Endowments are funds or assets given to universities for financial support. In exchange, the organization essentially gets to make their mark on or be associated with the university. 

Back in 2019, CBC News reported that the University of Guelph decided not to divest from fossil fuels despite pressure from Fossil Free Guelph. By that time, the group had four years of protests, marches, research and reports on the issue. 

Some board members cited the complexity of the issue and thought partial divestment was preferable. At the time, the university said they would try to reduce the carbon footprint of their endowment fund portfolio instead. 

A year later, the board walked back its decision and voted instead to commit to complete divestment for the sake of sustainability. Their goal, which was met, was to be completely divested by early 2025.

The release noted that this achievement also comes with a reduction in weight average carbon intensity (WACI), which is used to measure the carbon emissions associated with an investment portfolio. In divesting the portfolio from companies like ExxonMobil, Suncor and Syncrude, it has successfully reduced emissions by 74 per cent since 2018. 

Greenhouse gases based on their portfolio have also fallen to below 1990 levels. The release said the school plans to reduce them further by 37 per cent by 2030 and 80 per cent by 2050.