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The University of Oxford has come under heavy criticism after its £6 billion endowment increased its investments in fossil fuels, just a few years after making a landmark commitment to divest.
Although investments are small, the fund’s indirect exposure to fossil fuels increased from 0.32 percent to 0.52 percent between 2021 and 2022, according to published reports. Around £1 of every £200 of the fund is now invested in fossil fuels.
The university said in 2020 it would dump all direct investment in fossil fuels, after sustained pressure from students and academics. But this does not apply to indirect exposure through investments with external asset managers.
Zak Coleman, campaign director of Invest for Change, a campaign run by Students Organizing for Sustainability UK, accused the university of using “loopholes” to continue investing in fossil fuels. Burning fossil fuels is by far the largest contributor to climate change.
“It is extremely worrying to see the University exploiting these loopholes in its already weak policy to continue investing around £31.2 million in the fossil fuel industry that is working so hard to derail climate action.”
The Oxford Climate Justice Campaign, which led the push for divestment at the university, said: “This news is a shocking example of institutional greenwashing and a slap in the face to the students, staff, academics and alumni who have worked tirelessly for fossil fuel divestment. .”
The increased exposure to fossil fuels was the result of market movements as oil and gas share prices rose due to the energy crisis, and new investments by asset managers with positions in carbon-intensive shares.
Antonia Coad, head of sustainability and corporate affairs at Oxford University Endowment Management, which oversees the endowment fund, said the fund has “fully implemented” the university’s divestment commitments.
She added that the fund’s indirect exposure “will fluctuate from year to year for a variety of reasons,” including market movements like we see in 2021 and 2022.
The endowment, which oversees money for the university, its colleges and others, typically uses fund managers to invest, meaning it makes few direct investments. OUem also manages a medium-term capital account for the university. Including the capital account, OUem said the university’s exposure to fossil fuels now stands at 0.45 percent.
Education funds have come under intense pressure to move away from fossil fuels in recent years, with almost three-quarters of UK universities committing to a complete divestment.
This week, one of Europe’s largest pension funds sold its oil and gas giants, including Shell and BP, over concerns the companies were making little progress in transitioning to greener businesses.