(Updates with context on Steyer paras 10-12)
By Rory Carroll
SAN FRANCISCO May 7 Stanford University said on
Tuesday it will no longer use any of its $18.7 billion endowment
to invest in coal mining companies, a move aimed at combating
climate change that could influence college administrations
The university's board of trustees agreed with
recommendations from a panel of students, faculty, staff and
alumni that found investments in alternatives to coal would be
less harmful to the environment.
The burning of coal for electricity is a major contributor
to the output of heat-trapping greenhouse gas emissions
The Stanford announcement is the most significant to date
from a major, well-endowed college or university in the United
States amid a growing movement by students around the country to
pressure their institutions to divest from fossil fuels.
"The university's review has concluded that coal is one of
the most carbon-intensive methods of energy generation and that
other sources can be readily substituted for it," said Stanford
President John Hennessy.
It was announced on the same day the White House released a
report warning that climate change was already affecting the
United States in the form of more severe droughts in some areas
and more intense storms in others.
He added that Stanford, which is located on the edge of
Silicon Valley, is working to develop sustainable energy
The resolution means that Stanford will not directly invest
in approximately 100 publicly traded companies for which coal
extraction is the primary business, and will divest of any
current direct holdings in such companies, the university said.
Stanford also will recommend to its external investment
managers, who invest in wide ranges of securities on behalf of
the university, that they avoid investments in publicly traded
coal mining companies as well.
Billionaire hedge fund investor-turned-environmental
activist Tom Steyer, who has supported a number of colleges in
their campaign to purge coal investments, is an alumnus of Palo
Alto-based Stanford, a member of its board of trustees and
founder of two clean energy research institutes on campus.
Amid growing pressure from students and environmentalists, a
number of smaller institutions such as San Francisco State
University and Hampshire College in Massachusetts have agreed
recently to shed their coal holdings.
Students at other colleges including Brown University and
Middlebury College have also led divestment campaigns, with
Steyer's support, although both rejected the bids.
The announcement was cheered by a student-led organization
known as Fossil Free Stanford, which petitioned the university
last year to cut ties with the coal mining industry.
"We are proud that our university is responding to student
calls for action on climate by demonstrating leadership," the
group said in a statement. "Stanford's commitment to coal
divestment is a major victory for the climate movement and for
Jay Carmona, divestment campaign manager for 350.org, said
he hopes Stanford's decision will influence other universities.
"Now that one of the biggest endowments on earth has
acknowledged that it can't keep investing in climate change,
others can follow," he said.
Stanford does not disclose specific investments in its
portfolio nor their individual value, though it provides
information on endowment holdings and performance by broad asset
The total value of the endowment was $18.7 billion as of
Aug. 31, 2013, the close of the 2012-13 fiscal year.
(Reporting by Rory Carroll; additional reporting by Valerie
Volcovici in Washington)