The Long Of It

Fossil Free MIT is, first and foremost, a climate change action group. Divestment is our tactic, but mitigating climate change is our goal. We wrestle with the theory of divestment every day, and have come to conclude that it is the only strategy at our disposal here at MIT that is commensurate with the scale and urgency of the climate crisis. But we can imagine that, like us, you might have some questions about divestment. Here are our thoughts on a few of the most common ones…


Why should we target the fossil fuel industry when they are simply meeting consumer demand?

To be clear, divestment is about the failures of an industry and its leaders, but not of its laborers. Coal, oil, and gas companies certainly can’t take all the blame for our inaction against climate change, but they must take their fair share.

In many cases, the fossil fuel industry has done far more than just meet consumer demand.

In the early 1990s, when the world began to take political action to address climate change, the fossil fuel industry began to fight against it. In 2012 alone, the fossil fuel industry spent $417 million lobbying and donating against climate-action legislation1,2

It has also been well documented that the fossil fuel industry and its beneficiaries have often worked consciously and deliberately to undermine our knowledge of climate change: by orchestrating targeted anti-science disinformation campaigns - often through secretive funding networks – that confused the public, sabotage our science, and slander our peers. By torturing truth at a scale surpassing even that of Big Tobacco, the fossil fuel industry is undermining MIT’s raison d’être. This abominable doubt mongering is an attack on Science, and on MIT. As MIT Professor Kerry Emanuel noted at a recent Fossil Free MIT event, “…there is no doubt that there is a strong disinformation campaign. It’s not a conspiracy theory, it has been documented. There are billions and billions of dollars going into making Americans believe that there is no problem…”.

A good example is US oil company, Exxon Mobil. In 2005, in its “Corporate Citizenship Report”, Exxon stated3 that “it [is] very difficult to determine objectively the extent to which recent climate changes might be the result of human actions.” Yet four years earlier, the UN’s Intergovernmental Panel on Climate Change – the authoritative body on the science of climate change, backed by 193 governments – had concluded that “most of the observed warming over the last 50 years is likely to have been due to the increase in greenhouse gas concentrations.” In 2006, The Royal Society wrote an open letter to Exxon condemning the company’s “inaccurate and misleading” statements and demanding that the company withdrew its support (which has been documented in the peer-review literature4 ) for dozens of groups that have “misrepresented the science of climate change by outright denial of the evidence”5. How does funding Exxon Mobil fit into President Reif’s vision of an MIT “operat[ing] with the highest integrity and ethics”6?

In addition to all of this, the fossil fuel industry’s business practice is fundamentally incompatible with the science of climate change mitigation. The internationally-accepted global-warming guardrail is 2 °C, and we have already raised the average temperature of the planet by about 0.8 °C, causing far more damage than most scientists expected. One third of Arctic summer sea ice is gone, the oceans are 30% more acidic, and rising sea levels have exacerbated the damage caused by tropical cyclones. All CO2 emissions are damaging, and for a 50% chance of staying below the 2 °C limit, only a third of existing fossil fuel reserves may be burned. Despite this, in 2012, the top 200 fossil fuel companies allocated up to $674 billion for finding and developing more unburnable fossil fuel reserves7,8,9,10.

UN climate chief, Christiana Figueres, put it this way11: “If corporations continue to invest in new fossil fuels, they are really in blatant breach of their fiduciary duty, as the science [of climate change] is abundantly clear,” she said. “Understanding the science, the fact is that we have to move to low-carbon no matter what, with or without policy.”

Isn't it hypocritical to divest when we are all so reliant on fossil fuels?

Consider this: Professor Timothy Gutowski’s research at MIT has shown that the average carbon footprint of an American homeless person is 8 tons CO2 per year12, almost double the world’s average. Our deep-seated reliance on fossil fuels is a failure of our society’s system, but not of personal virtue. It’s true that we are all reliant on fossil fuels - our current energy infrastructure makes it impossible not to be13. But this does not absolve us from doing what we can to begin to change the system, and it does not entitle us to keep endorsing the status quo.

Won't divestment prevent us from exercising influence as a shareholder?

Shareholder engagement has two fundamental flaws:

(i) There is simply far more coal, oil, and gas than we can safely burn. For a 50% chance of staying below 2 °C of global warming, two-thirds of existing fossil fuel reserves must remain in the ground. A resolution to stop extracting fossil fuels at a fossil fuel company’s Annual General Meeting would certainly never pass.  World-renowned Boston-based financier, Jeremy Grantham, put it this way: “As a former oil analyst, I can easily calculate oil companies’ enthusiasm to leave 80% of their value in the ground — absolutely nil.”14

(ii) It is perhaps more feasible to use shareholder engagement to address fossil fuel companies’ political lobbying and anti-science disinformation campaigns. But practically speaking, universities hold such a minuscule percentage of total shareholder votes that the chances of even a consortium of universities winning a shareholder resolution are equally miniscule15.

Won't divestment jeopardize our university's endowment or research funding?

(a) Our university’s endowment:

Divestment can in fact help secure our endowment against the looming “carbon bubble”: the value of fossil fuel assets is becoming increasingly uncertain – and in turn, diminished – as governments consider imposing climate regulations that force fossil fuel companies to keep their reserves underground. World Bank President Jim Yong Kim and United Nations climate chief Christiana Figueres have urged divestment from carbon-rich assets for this very reason9,16,17.

We recognize that each university’s endowment portfolio is different, and because this information is not public at MIT, projections based on generalized case studies have to be viewed with caution. Nevertheless, several financial experts have shown that fossil fuel divestment can lead to higher and less-risky financial returns. For example, S&P Capital IQ analyzed the S&P 500 index, and found that endowments would have been 5% more successful had they divested 10 years ago18,19.

(b) Our research funding:

We can’t predict what fossil fuel companies may do in response to divestment, but there are two points worth considering:

(i) Fossil fuel companies do not invest in MIT because MIT invests in them. It seems more than likely that fossil fuel companies fund research on climate and renewable energy in large part to improve their public image. After the ceremonial signing of a new funding agreement between the MIT Energy Initiative (MITEI) and Italian oil giant, Eni, the company’s CEO, Paolo Scaroni commented20, “When I started this whole thing, I did it, as we say in Italian, ‘to save my soul.’” An MIT news website explains20 that “[w]hen [Scaroni] signed the initial agreement of support for MITEI…he was largely motivated by the desire to be able to answer questions from environmentalists and others who would ask him, “Why don’t you do something for the future of the world?””

Good ‘PR’ was the foremost reason for this fossil fuel company’s investment in MIT. As stricter climate change legislation and stronger public support begin to emerge, increasingly stigmatizing carbon-intense fossil fuels, one can only imagine that the fossil fuel industry’s support of research to find scientific and technological alternatives would need to grow to protect their tarnishing reputations.

Fossil fuel companies also have a stake in the success of our research. Thanks to their expertise and infrastructure, they sit poised to reap many of the benefits of an energy revolution, and investment in MIT ensures that they keep their stake in the game, just in case. They invest in MIT because MIT’s research is an investment in their future, and ours.

Also remember that much of the fossil fuel industry’s research funding at MIT in fact goes into the development of core fossil fuel development and extraction technologies. As Paolo Scaroni, CEO of Italian oil company, Eni, puts it20, “Cooperation between MIT and Eni can give us phenomenal results.” After the signing of a funding agreement with MIT President Rafael Reif, Scaroni extolled20 the benefits for Eni of funding MIT’s research to improve average oil recovery rates from 33% to 36%: “Three percent more would be so much money, so much more production, that we could pay back [the research costs] for the next 100 years, not just five years. So the potential for improvement of our results through this cooperation with MIT is so huge that we certainly are very much convinced to go ahead.”

(ii) It would be a tragic surrender of our universities’ raison d’être – truth and knowledge – for us to not lead against climate change for fear of losing funding from the fossil fuel industry. No industry should be permitted to hold our institution financially hostage because of their political agenda. We believe that we can no longer stand idly by, as irreversible damage continues to be done to the planet, and to the credibility of science.

Most universities are already engaging in campus sustainability efforts – isn't that enough?

Unfortunately, no. Consider the following:

Campus sustainability

As an example, between 2006 and 2012, Harvard University achieved a greenhouse gas emission reduction, through ambitious sustainability initiatives, of 0.0075 million tons CO2-equivalent (Mt CO2-eq) per year, making its 2012 campus emissions 0.24 Mt CO2-eq21. MIT’s carbon footprint is very similar22,23


Most universities, MIT included, refuse to disclose what fractions of their endowments are invested in fossil fuel companies. But at the University of Michigan, students used the Freedom of Information Act to discover that approximately $1 billion of their $8 billion endowment is invested in fossil fuels24.

Using this number as a case study (which is conservative, because Harvard’s endowment is four times larger than the University of Michigan’s), a back-of-the-envelope calculation indicates that this $1 billion effectively finances the extraction of around 10 Mt CO2-eq of oil per year. That is, the MIT endowment supports about 40 times more CO2-extraction than all of the MIT campus emitted in 201225.

Campus sustainability initiatives are very important, and we fervently support them. But as the numbers above show, they are simply not enough. The International Energy Agency states26 that because of infrastructural inertia, we have three years (until 2017) to cease development of new fossil fuel infrastructure if we are to stay below the global-warming guardrail of 2 °C. Sustainability efforts alone are incommensurate with the scale of the climate change problem.

Isn't it shortsighted to ask for divestment when we don't yet have the renewable energy technologies to replace fossil fuels?

Peer-review studies are increasingly concluding27 that “humanity already possesses the fundamental scientific, technical, and industrial know-how to solve the carbon and climate problem for the next half-century.” What we lack is societal and political will.

As another highly recognized peer-review report explains28, “It is important not to become beguiled by the possibility of revolutionary technology. Humanity can solve the carbon and climate problem in the first half of this century simply by scaling up what we already know how to do.” Politics and economics – and not technology – are now the bottlenecks to mitigating climate change.

The challenges ahead of us are great, and technological breakthroughs will be vital, for example, in energy storage. But an energy revolution is within our technological grasp. What is missing is leadership to effect this change. Divestment is not a panacea, but it can be a catalyst for awakening the world from climate inaction1.

In an op-ed entitled “Climate crisis: who will act?”, Kofi Annan, former United Nations Secretary-General, stated29: “If governments are unwilling to lead when leadership is required, people must. We need a global grass-roots movement that tackles climate change and its fallout…Green thinking cannot be the sole responsibility of a few environmentally minded activists, while the rest of us go on living as if there were no tomorrow.”

Won't divestment have negligible financial impacts on fossil fuel companies?

The act of divestment itself will have very little financial impact on the fossil fuel industry. Indeed, this is not the goal of fossil fuel divestment. As described above, the bottleneck to meaningful action on climate change is societal and political will. The power of divestment lies in its indirect impacts30.

As a report from the Oxford University recently showed31, “The outcome of the stigmatisation process, which the fossil fuel divestment campaign has now triggered, poses the most far- reaching threat to fossil fuel companies and the vast energy value chain.”

Divestment sends a strong moral signal, which can serve to shift public discourse, and through it, inspire civil action. Divestment is powerful because MIT wields a megaphone to public opinion and am immense capacity to inspire change. What we do here can influence others. What we do here does influence others. Divestment has a proven theory of change that in almost every instance has resulted in restrictive legislation: from the Sudan Accountability and Divestment Act; to The Comprehensive Anti-Apartheid Act; to the price of a pack of cigarettes going from $1.75 in 1980 to $4.25 today. It has worked. And it can work again32.





  1. Berners-Lee, M., Clark, D. The Burning Question. (2013). [link] [] []
  2. Oreskes, N., Conway, E. M. Defeating the merchants of doubt. Nature 465, 686–687 (2010). [link] []
  3. Adam, D. Royal Society tells Exxon: stop funding climate change denial. The Guardian (2006). [link] []
  4. Brulle, R. J. Institutionalizing delay: foundation funding and the creation of U.S. climate change counter-movement organizations. Clim. Change 122, 681–694 (2013). [link] []
  5. Adam, D. Royal Society tells Exxon: stop funding climate change denial. The Guardian (2006). [link] []
  6. Reif, L. R. Ethics education at the Institute. The Tech (2013). [link] []
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  11. Harvey, F. ‘Carbon bubble’ poses serious threat to UK economy, MPs warn. The Guardian (2014). [link] []
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  14. Grantham, J. Be persuasive. Be brave. Be arrested (if necessary). Nature 491, 303 (2012). [link] []
  15. Spross, J. Harvard’s Four Reasons For Not Divesting From Fossil Fuels, And Why They’re All Wrong. (2013). [link] []
  16. King, E. World Bank chief backs fossil fuel divestment drive. Responding to Clim. Chang. [] (2014). [link] []
  17. Dorsey, E., R. N. M. Philanthropy Rises to the Fossil Divest-Invest Challenge. Huffington Post (2014). [link] []
  18. Begos, K., Loviglio, J. College fossil-fuel divestment movement builds. Yahoo News (2013). [link] []
  19. New Report Outlines Institutional Pathways to Fossil Fuel Divestment (Tellus Institute). [link] []
  20. Chandler, D. L. MIT and Eni renew energy partnership. MIT News (2013). [link] [] [] [] []
  21. Sustainability at Harvard: Impact Report [link] []
  22. Groode, T. A. A Methodology for Assessing MIT’s Energy Use and Greenhouse Gas Emissions. MIT Masters Thesis (2004). [link] []
  23. Energy on Campus. The MIT Energy Research Council. [link] []
  24. Takahashi, C. Michigan daily formally endorses divest and invest campaign ( (2013). [link] []
  25. Fossil Free MIT: “How much carbon is our university’s endowment funding?” [link] []
  26. World Energy Outlook 2012 (International Energy Agency) (2012). [link] []
  27. Rogelj, J., McCollum, D. L., Reisinger, A., Meinshausen, M. & Riahi, K. Probabilistic cost estimates for climate change mitigation. Nature 493, 79–83 (2013). [link] []
  28. Pacala, S. & Socolow, R. Stabilization wedges: solving the climate problem for the next 50 years with current technologies. Science 305, 968–72 (2004). [link] []
  29. Annan, K. Climate Crisis: Who Will Act? New York Times (2013). [link] []
  30. Ansar, A., Caldecott, B., and Tilbury, J. Stranded assets and the fossil fuel divestment campaign: what does divestment mean for the valuation of fossil fuel assets? (Oxford University Smith School of Enterprise and the Environment) (2013). [link] []
  31. Ansar, A., Caldecott, B., and Tilbury, J. Stranded assets and the fossil fuel divestment campaign: what does divestment mean for the valuation of fossil fuel assets? (Oxford University Smith School of Enterprise and the Environment) (2013). [link] []
  32. [link] []
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