On April 20, dozens of Kenyon students — and a few faculty, staff and alumni — rallied in front of the Kenyon Inn to tell the Board of Trustees that our campus supports divestment. This happened right after members of Kenyon Democrats and Divest Kenyon met with Chair of the Budget, Finance and Audit Committee and Vice-Chair of the Board of Trustees Joe Lipscomb ’87 to talk about the College’s investments. Students demanded that the College remove its holdings in the top-200 fossil fuel companies (ranked by the potential carbon emissions content of their reported reserves) and pledge not to invest in the two largest private prison corporations (GEO Group and Corrections Corporation of America). Kenyon will not release its exact investments, but trustees have confirmed that seven to eight percent of our endowment is invested in the energy industry, which encompasses the fossil fuel industry.
While Divest Kenyon’s petition received more than 800 signatures from students, faculty and alumni, some members of the community still have questions about the purpose of a divestment campaign. This piece serves to answer a few of these questions.
We frequently hear concerns that divesting won’t financially affect the companies that we are targeting; if we sell our shares in a fossil fuel company, other investors will buy them, and there will be no net effect on the corporation. However, the purpose of a divestment campaign is not to hurt companies financially, at least not in the short term.
The logic behind divestment campaigns is that they are one way institutions with a lot of social power can mobilize against corrupt industries. While wealthy corporations can buy political leverage to a certain extent, they are not immune to the power of a mass movement. The goal of this divestment campaign is to stigmatize fossil fuel and private prison corporations. This will ultimately affect their ability to make a profit, but that is not the immediate goal.
A related concern we often hear is that divestment is arbitrary. Why should we divest from fossil fuels and private prisons if we don’t divest from other immoral industries? Pretty much everything we invest in could be considered “unethical” in some sense. While this argument would make sense if divestment were merely about ethical investment, the function of this divestment campaign is actually to unite political organizers around the world and build a movement to challenge fossil fuel and private prison corporations. Its power comes from the fact that thousands of universities, faith groups, corporations and even countries have participated in similar campaigns, and many (including Pitzer College, the Rockefeller Brothers Fund and the city of Oslo) have won. Together, these groups are promoting awareness of the devastating effects of fossil fuels and private prisons and building political energy to challenge these corporations’ financial power. Divestment is not an end in itself but rather a tool. Therefore, we do not ask that Kenyon make all of its investments based on “ethics” but that it join these two specific campaigns. When the College decides to divest from these companies, the statement will inform public opinion, thus advancing the international movement against the fossil fuel and private prison industries.
Another frequent question is whether or not fossil fuel divestment would ultimately hurt our endowment, thus hurting students and limiting our financial aid options. This is a very valid concern. Luckily, this is not a choice that the College would have to make. Recent research by major financial organizations has suggested that divestment does not hurt financial portfolios. A 2013 report (“Responding to the Call for Fossil-fuel Free Portfolios”) by Morgan Stanley Capital International, a provider of financial indexes and analysis tools, stated: “Fossil fuel divestment has the potential to reduce overall portfolio risk because of Energy Sector volatility,” and found that divested portfolios closely tracked non-divested portfolios in simulations. Thus it is extremely unlikely that removing our holdings in the top-200 fossil fuel companies would affect our endowment.
We are not currently invested in GEO Group or CCA, so private prison divestment would not affect our endowment while still allowing us to stand with the prison divestment movement. Furthermore, divestment will likely make Kenyon more attractive to alumni donors and prospective students. Rolling Stone quotes Stephen Mulkey, the former president of Unity College in Maine: “After we divested, we started receiving donations online. We’ve seen an uptick in our inquiries from students. I think that will transform into an improvement in enrollment. That’s not why we did it, but it’s a fact.”
Finally, many people wonder if divestment will “work.” There, the proof is in the pudding. The divest movement against South African apartheid, active in the 1980s, played a large role in the system’s ultimate demise. Kenyon refused to divest from South Africa several decades ago. This time, let’s be on the right side of history.
Katherine King ’19 is a sociology major from Wilder, Ky. Contact her at firstname.lastname@example.org.