CENTRAL MANAGEMENT GROUP
20 January 2015
Fossil Fuels Review Group Update
Description of paper
1. This paper provides an update to CMG on progress made by the Fossil Fuels Review Group established following the meeting of 8 October 2014.
2. CMG is invited to NOTE the paper.
Background and context
3. At its meeting on 8 October,CMG noted the results of the responsible investment consultation, approved a draft responsible investment policy, and noted resulting feedback which expressed a wish from sections of the student body and others to review the University’s investment in certain sectors, including fossil fuels and armaments.
4. The EUSA President and Vice-President Services attended CMG and presented concerns around investment in fossil fuels and armaments and the case for disinvestment. It was agreed given the complexity of the issues involved to establish a short-life working group under the convenership of the Senior Vice-Principal. The group was remitted to initially consider the case for disinvestment in fossil fuels against the criteria as set out in the draft Policy. If this approach proved appropriate thereafter a similar approach could be adopted to explore disinvestment in armaments.
5. At its first meeting on 5 November the Groupdiscussed its remit: to produce a range of options, ideally based on a consensus view, which could be considered by CMG, including the impacts of those options.Members reviewed the UN PRI consultation summary and response, the draft of the revised Socially Responsible Investment policy, and the covering paper submitted to CMG on 8 October which set out the background to the issue.
6. Output from the process would be reviewed in great detail by stakeholders and a strong evidence base would be critical to success.The Group considered an initial paper engendering a broad understanding of the ways that evidence would be assembled. The paper comprised 7 broad evidence types: climate science and emissions; decisions made by other asset owners including universities; dependence on fossil fuels and derived products; the University’s values; impact on investment strategy, capital and returns; impact on other areas of University activity; future trends and likely changes.
7. At its second meeting on 27 November the Group considered a fuller digest of the evidence, accepting as a foundation for its work scientific evidence that the climate was changing according to predictions, that this was caused by humans, that it would have a negative impact, and that UoE should make a contribution to both adaptation and mitigation.Recognising the need for a consistent outcome, members also considered: a list of teaching programmes; data from the Careers Service on engagement with the oil and gas sector as potential recruiters; output from Edinburgh Research Explorer using ‘fossil fuels’ and ‘carbon’ as search terms; data from ERI identifying a smaller list of specific sponsorship and studentships.
8. The Group agreed on a broad approach to investigation of the evidence base, followed by analysis and summation, allowing for an understanding of the range and validity of possible viewpoints. Regarding the University investment portfolio, the main areas for consideration would be:
•The impact on the overall investment strategy of the endowment fund
•The ability to implement any proposed changes
•Costs associated with proposed changes.
9. The EUSA request did not specify a sense of the relative weighting of particular activities within the fossil fuel sector.An expanded version of the evidence paper including definitional considerationsand the relative contributions to global warming of different activities will be used in informal consultation with student groups. Engagement with the School of Geosciences through institute meetings was ongoing. It was clarified that the formal request for action from students was activated via the CMG discussion on 8th October.
10. In the absence ofa codified statement of the values of the University, the Group reviewed extracts from strategic documents including the Strategic Plan, SRS 2010 Strategy, Climate Action Plan and draft Responsible Investment Policy. Membersalso considered summaries of other Universities’ decisions, which revealed the spectrum of views, recognising however that the Group would come to its own recommendations based on the evidence.
11. Consideration of resource implications would form an integral part of the process as it develops and a full report would be made to CMG on 14 April.
12. Analysis of potential risks to University reputation and funding will be provided as part of the final report.
Equality & Diversity
13. Due consideration has been given to equality and diversity as a key element of the SRS agenda, in line with the University’s Equality and Diversity Plan.
14. The Group willmeet again on 12 January, 11 February, and 9 March 2015. At the next meeting members will consider the relative contribution of fossil fuelstypes, assessment of the extent of dependence, feasible alternatives,mitigation strategies and possible options to explore further. Subject to adequate progress, the Group aims to present a final report to CMG on 14 April.
16. Paper prepared and to be presented by xxxx
3 December 2014
Freedom of Information
17. The paper should remain closed until formal conclusion of the review process.
Prof Charlie Jeffery / Senior Vice Principal (Convenor)
Dave Gorman / Director of Social Responsibility & Sustainability
Tasha Boardman / EUSA Vice President Services
Mark Connolly / Director and Head of Fixed Income at Scottish Widows
Investment Partnership (Member of Investment Committee)
Prof Andrew Curtis / Professor of Mathematical Geoscience
Dr Andy Kerr / Executive Director, Edinburgh Centre on Carbon Innovation
Prof Lesley McAra / Chair of Penology, School of Law
Phil McNaull / Director of Finance
Tracey Slaven / Deputy Secretary, Strategic Planning