Socially Responsible Investing at Sewanee

By Hadley Montgomery

Executive Staff

On Tuesday, April 5, in Gailor Auditorium, the Sewanee Student Investment Club, Divest Sewanee Club participated in a panel hosted by the Babson Center for Global Commerce, the Business House, the Center for Religion and Environment, the Economics Department, the Office of Environmental Stewardship and Sustainability, and the School of Theology. The debate allowed the two sides to discuss their perspectives on socially responsible investing. Socially responsible investing is an initiative started by many colleges that seeks both profit and “green” investing. The idea for a socially responsible investing debate began with the revival of the Divest Sewanee Club by many Sewanee students. As Sewanee students, we each want what is best for the present and future of Sewanee as an institution. Therefore, the two sides of the debate surface: the Divest Sewanee side and the Investment side. Prior to the debate, fifty-three students participated in a survey on socially responsible and impact investing.

The Sewanee Student Investment Club “is organized to foster understanding of the role of investment management. The organization provides opportunities for students to exhibit knowledge and skills to employers, while encouraging and facilitating the development of relationships among Sewanee students and investment management companies.” According to the leaders of Invest Sewanee, each year the SIC manages $500,000 of the endowment by choosing stocks in which the university will invest. The sectors within the Investment Club include energy, technology, financial, industrial, healthcare, and consumer. Each sector pitches an investment option with strong earning potentials for the club to pursue throughout the year. Reed Jackson (C’16) says “The Investment Club has a dedicated discussion to socially responsible investing and whether or not whichever companies stock we are buying, are they doing anything we do not agree with…do they have any quesitonable things.”

The Divest Sewanee Club, revived this year, is continuing efforts attempted by many students in 2011. The objective is to remove investments from companies involved with extracting fossil fuels in order to reduce the harmful effects of climate change. It encourages people to consider changing their current investments in fossil fuel companies and redirect their investments into companies less harmful to the environment. Mallory highlights “the biggest part of divestment is starting a conversation between students, faculty, and staff regarding our values as a university and how environmental stewardship fits in to that.”

The two sides provided an engaging debate on the topic of socially responsible investing. Debaters highlighted the differences between Sewanee and other collegiate institutions in the debate, including Stanford and Harvard. Stanford chose to divest from coal with their $21 billion endowment, while Harvard, with a $36 billion endowment, did not divest but “will continue to confront the problem of climate change in the way that a university as an academic institution most meaningfully can and should through research, education, and innovative sustainable practices and thoughtful engagement with others who can help the world find real solutions to such a complex and consequential challenge”.

Arthur Jones (T’18), Mallory Graves (C’16), and Darby McGlone (C’17)represented the Divest Sewanee position while Michael McCain (T’16), Mark Flournoy (C’16), and Grey York (C’16) defended the Invest Sewanee perpsective. The Divest Sewanee position commits to socially responsible investing with a focus on climate change. Graves spoke on the mission statement of the university, “that students be prepared to search for truth, seek justice, preserve liberty under law, and serve God and humanity.” The Divest Sewanee perspective, based on the mission of the university, sees Sewanee as an institution that can set a precedent for other institutions in regards to combatting climate change. Grave’s argument continued by highlighting the volatility of the fossil fuel market, saying, “Since 2005, the fossil fuel energy has been among the most risky sectors in the global economy.” The Divest Sewanee side believes the university should begin by phasing out coal from its investments and then divest from oil and other fossil fuels. It is the “fiduciary responsibility of the University to invest in cleaner and inherently safer stocks.”

Invest Sewanee claims, “Divestment from fossil fuels is not a suitable means for enacting change for climate for the University.” Referring to the mission statement of the university, the Invest Sewanee side believes, “This act of divestment limits the universities mission for education, research, and community.” The investment side agrees that Sewanee should consider how to affect change on a local scale rather than divest.

After the conclusion of the debate, forty-four people participated in a survey with questions similar to the previous survey. With this data, it is clear that the attendees of the debate were relatively uneducated on the subject matter of socially responsible investing;. however, by the conclusion of the debate, approximately 20% more attendees felt knowledgeable about socially responsible and impact investing. Although there will be no immediate action following the debate, it provides an open forum for people to talk about our future of investing here at Sewanee.

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