Yale's Big Endowment Sells Less Than $10 Million in Fossil Fuels

  • At $25.6 billion, fund is second-largest in U.S education
  • Divest Harvard members held separate protest in Boston

Managers of Yale University’s $25.6 billion endowment sold less than $10 million in investments in fossil-fuel companies that were “inconsistent with our principles” of a sustainable environment, according to David Swensen, the fund’s chief.

One of the fund’s outside managers exited a small position in a publicly traded company that produced and sold coal, according to a letter posted Tuesday on the school’s website. A second manager sold interests on Yale’s behalf in two publicly traded oil sands producers, Swensen wrote. Neither the managers nor the companies were named.

The endowment had minor exposure to those industries as of June, Swensen said. The letter was an update to one that Swensen wrote in August 2014 to its external investment managers, asking them to assess the costs of climate change on their investments, following a university-wide effort to address sustainability.

Popular Issue

Fossil-fuel divestment has been a popular issue in recent years among college students, who have protested at campuses around the country. Divest Harvard held a sit-in at the offices of Harvard Management Co. in Boston Tuesday, demanding to speak with the university about a recent investment in a private equity fund set up to buy struggling oil and gas companies, the student-led group said in a statement. The Boston Police Department said it responded to a disturbance at the building.

Yet even with the movement spreading to more than 1,000 campuses, only a few dozen schools have placed some restrictions on their commitments to the energy sector. Cornell University, Massachusetts Institute of Technology and Harvard were among the largest endowments to reject demands to divest.

In the original letter, Yale had asked its managers to assess the greenhouse gas footprint of prospective investments, the direct costs of the consequences of climate change on expected returns, and the costs of policies aimed at reducing greenhouse gas emissions on expected returns.

Since that letter, new investments “have been in keeping with the spirit of the approach,” he wrote. “We believe the lack of new investment in greenhouse gas intensive energy companies confirms a common understanding between Yale and its external managers.”

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