How Can UW-Madison Lose Money By Divesting?

However, many of those opposed to divestment say that UW-Madison will lose money by divesting. One reason for this is that divesting entails restricting the freedom of the managers who run the university’s endowment fund. In total, colleges and universities own $12 billion worth of fossil fuel company stocks. Presumably, the the reason that most universities currently invest in fossil fuels is that fossil fuels are a good investment. If renewables were actually a better investment than fossil fuels, as divestment advocates claim, financial experts would likely already be investing in renewables. Furthermore, UW-Madison may have a harder time hiring financial managers after divestment. In 2016, Dartmouth University was considering divesting

In 2014, over 1,400 UW-Madison students signed a petition to get UW-Madison to divest its investments in fossil fuel companies. Among their rationale for signing was that the actions and policies of large public universities are closely followed by the media and the public. A Badger Herald article from that year quotes a student who writes, “I think the splash we would make would raise the level of knowledge and discussion that is so desperately needed”. Thus, at the very least, divestment by big public universities such as UW-Madison would get more people talking about climate change. Another student wrote that, “There are many among us at the UW who feel that it is wrong to seek profit by investing in such monumentally irresponsible endeavors”. If UW-Madison’s divestment from fossil fuels created a big enough wave in the media, fossil fuel companies might start to worry even if the divestment had little economic

The path to divestment will not be easy. In 2014, a panel of UW-Madison faculty members convened and was split on whether or not to divest. If divestment were to be brought back to the table, it would take a huge initiative from students and staff to push it through. The time, money, and mental focus that would go towards achieving divestment is an opportunity cost. Craig Benson, Director of Sustainability Research and Education at UW-Madison, has a clear vision for how those resources could be used more effectively. Benson was one of the panel members for the 2015 Climate Quest competition at Madison. The competition challenged community members to address a problem caused by climate change. The winner in 2015 was a project to provide sustainable food production to regions of developing nations with high food insecurity. Benson said of the project, “rather than advocate through protests or divestment, we chose to draw on our greatest strengths – the energy, creativity, and talents of our faculty, staff, and students.” Although Benson is specifically referring to the Climate Quest competition, his words echo the belief among anti-divestors that focusing on innovation and research is the most resource-effective way to combat climate