March 9, 2014

LETTER: Divestment Ethics

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To the Editor:

Re: “TRUSTEE VIEWPOINT: Divestment: A Need For Better Arguments,” Opinion, Mar. 4

Darrick Evensen raises important questions about the cases being made for divestment, but there are sound ethical and economic arguments that are being made in favor of divestment.  A principal reason for doing anything about the human impact on climate is to be ethical. Justice principles demand that we try to mitigate harms from climate change on people in other places and in future times, as well as to the ecological systems of Earth. These justice principles are why Cornell has decided to stop selling clothing from factories linked to labor abuse. These principles apply to achieving climate neutrality through direct action and through our investments. We have a particular obligation to reduce fossil fuel consumption because we are a wealthy country that has contributed far more than a proportionate share of greenhouse gasses. The ethical case for divestment is intimately related to arguments for achieving climate neutrality.

We should be consistent in our approach. If we reduce our harm to others through lessening our direct use of fossil carbon, we should also reduce our harm through refusing to invest in fossil carbon companies. This is what being ethically consistent means. Not “walking the walk” is hypocritical and reduces our moral leadership.

As more people and institutions lessen their use of fossil carbon, the value of fossil fuel stocks will decline. This raises an economic case for divestment. This is the “prudent investor” concern raised by those in charge of the New York and California pension funds, and by articles in the financial news about “stranded assets.” The president of the World Bank is also promoting divestment based on climate change destroying past World Bank investments. The discussion currently taking place in Norway about whether its sovereign wealth fund (Norway’s endowment) should divest from fossil carbon companies is based on being both a prudent investor, and ethically consistent about climate neutrality.  This is a striking development, as much of the wealth in this fund comes from extracting North Sea oil.

General concerns about possible loss of endowment income are reasonable. These concerns determined the details of the faculty divestment resolution. Careful calculations by Prof. David Shalloway, molecular biology and genetics, and others using data obtained from the Cornell Investment Office strongly indicate that there is really not much financial risk for Cornell if the University divests.

In our view, there are persuasive ethical, economic and moral leadership reasons to divest, even as we tackle the climate neutrality issue on a variety of fronts.

Prof.  Brian Chabot, ecology and evolutionary biology

Prof.  Elizabeth Sanders, government

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