Skip to Content, Navigation, or Footer.
Logo of The Middlebury Campus
Wednesday, Jun 7, 2023

Divestment Debate Continues

Over the course of two evenings, the College community saw its leaders “do the math” on divestment in two radically different ways.

On Sunday evening, Schumann Distinguished Scholar Bill McKibben and others spoke to over 150 college and local community members at Mead Chapel in the last stop on McKibben’s “Do the Math” nation-wide tour — their main objective: to illustrate the direct link between divestment and the prevention of climate change. During the event, McKibben and others called on the College to “lead the way” on divestment, encouraging the administration to evaluate its decision based on alternative metrics to those normally considered: the currencies of “movements, passion, experience and creativity.”

Two days later, at the College-sponsored panel on divestment that filled most of the 400 seats in the McCullough Social Space, the tone was decidedly different.

During the two-hour event, the heated discussion centered largely upon the price of divestment for the College — how would it affect the strength of the endowment for the future? How much would it cost to restructure the College’s current co-mingled investment structure? And what other possible options might be open to the College in seeking to curb climate change?

At Sunday’s event McKibben, leading environmental activist and co-founder of was joined onstage by strong proponents of divestment, Professor of Economics and Chair of the Environmental Science Department Jon Isham, and Professor Emeritus John Elder. The event also included pre-recorded video messages from Archbishop Desmond Tutu, Canadian indigenous activist Clayton Thomas-Muller, environmental advocate Van Jones and renowned author and activist Naomi Klein.

In her remarks, Klein challenged the college community to take action: “We need you to provide a strong, coherent message,” she said, “There is no doubt in my mind that others will follow.”

Tuesday’s panel, in contrast, was composed of speakers whose professional experience lay primarily in the fields of economics and investment.

On the panel, McKibben was joined by Ralphe Earle III, a renewables-focused venture investor; Alice Handy, founder and president of Investure, LLC — the firm that manages the College’s endowment; Mark Kritzman, adjunct professor of finance at MIT; and Patrick Norton, vice president for finance and treasurer. Student Government Association (SGA) President, Charlie Arnowitz ’13 was a last-minute addition to the panel’s roster, and provided the lone student voice on the panel.

The moderator for the panel was David Salem ’78, managing partner of the investment advisory firm Windhorse Capital Management, and former founding president of The Investment Fund for Foundations (TIFF).

Each of the six panelists was accorded approximately seven minutes to speak, responding to a series of questions provided by Salem.

Norton spoke first, explaining the College’s fiduciary duty to manage the endowment both for current and future students by observing the principal of “generational equity.”

Investure Founder Handy then spoke of her desire to continue to work “as a part of the Middlebury team,” citing her firm’s mission statement to “[remain] open to change, [embrace] continuous improvement and [serve] with integrity and transparency.”

Handy remarked that she would “absolutely” work with students to better understand the endowment, but explained that Investure would require a buy-in by “100 percent” of the firm’s 13 clients in order to embrace a divestment policy — a requirement necessitated by the firm’s co-mingled investment strategy.

Following Handy’s remarks, MIT professor Kritzman summarized the results of his recent study on the potential costs of divestment for the College.  He explained that at best, the decision to divest from fossil fuels and arms manufacturing companies would result in a loss for the College of $17 million over five years — at  worst, he explained, the study found that divestment would cost the College $420 million over 20 years.

During the question and answer segment McKibben flatly disputed this hypothesis, providing counterfactual data that suggests divestment would elicit a neutral, or slightly positive return.

The exchange between the two became heated at times, illustrating two of the central conflicting views in the room.

“I apologize for trying to interject some science and rationality into the conversation,” Kritzman quipped at one point, in response to a student question.

During his opportunity to speak, Arnowitz thanked the administration for including a student on the panel, before summarizing the preliminary results of a recent SGA survey.

According to the responses of over 1,000 students, Arnowitz explained, 63 percent believe the College should apply the principles of socially responsible investing to its endowment, 14 percent of students were opposed and 23 percent had no opinion.

“[While] for many students this issue takes a backseat,” he said, “the plurality of students support some kind of action on divestment.”

Later in the discussion, Earle, a lifelong environmental advocate and investor, spoke of his significant concerns about the effects of climate change in his opening statement, but suggested that he did not believe divestment was the correct strategy.

“I think climate change is the most critical issue we face as a society today,” Earle began. “However … I don’t think that divestiture from fossil fuel stocks will be effective in reducing climate change,” he continued.

In supporting his argument, he provided the examples of the “unsuccessful” divestment campaigns from both tobacco manufacturers in the ’80s and from companies supporting the genocide in Darfur during the last decade.

Earle suggested that in lieu of divestment, the College should retain its proxy voting privilege to affect the choices of major fossil fuel companies. He also called on students to live out their vision of a greener future by purchasing eco-friendly cars, and switching from coal to gas as an energy source.

McKibben rejected these suggestions. As at Sunday’s “Do The Math” event McKibben explained that such initiatives were not enough, recognizing that fossil fuel companies now hold reserves that if burned, will release five times the “safe” amount of carbon dioxide into the atmosphere, if not prevented by a dramatic change.

Responding to the criticism of audience members and other panelists, McKibben suggested that the goal of divestment was not to “bankrupt Exxon” but rather to use colleges, universities, religious organizations and others to “peel away” the sense of legitimacy of the largest fossil fuel companies — something politicians have “failed to do” over the past 30 years in Washington.

McKibben cited Norton’s reference to “inter-generational equity” from the early moments of the panel, explaining his view that it is “morally wrong” to invest in companies whose missions “ensure that students will not have a planet” to inherit. He asked that the College commit to invest no new money in fossil fuel companies during the spring, and to taper their investments in fossil fuel and arms manufacturing companies to zero over the next five years.

McKibben’s remarks were met by a standing ovation from many audience members.

Following the panel, President of the College Ronald D. Liebowitz provided his initial reaction to the event.

“I think there was a tension in the room and on the panel that reflected how difficult an issue [divestment] is — that [the issue] still [involves] a lot more emotion than delving into facts,” he said. “But that doesn’t take away from the evening. I thought it was a very good start. I think it’s a longer process than one panel.”

One of the many students in attendance, Socially Responsible Investment club member Laura Berry ’16 explained that she was “frustrated” that the audience did not have more time to pose questions to the panelists, but explained that she felt as though individuals “learned a lot from the panelists.”

“I think we gained a great deal of knowledge about the specific details of the endowment and how it relates to other colleges in the consortium,” she said. “I expect we can move from here pretty well.”

In closing the panel, Salem directed community members toward the College’s website to continue the divestment discussion, reiterating that future panels will be held in order to further analyze critical issues.