What Does the Future of Sustainability Look Like After Concordia Divests?
Divestment Is Only the First Step to a Sustainable Future
On the afternoon of Nov. 8, the phones of the more than 50,000 students, faculty, and staff at Concordia University chimed in unison. A special divestment edition of Concordia University NOW had hit inboxes announcing the university was fully divesting from fossil fuels and aiming for 100 per cent sustainable investments by 2025.
The previous day, Erik Chevrier—who had been pushing for divestment since 2013—had been set to give a presentation to the administration.
When the presentation was cancelled, he thought the university was stalling him, but he said its announcement came as a pleasant surprise—one a long time coming.
The move came amidst a spike in climate justice activism and growing acceptance of the need for action. The university itself had symbolically canceled classes for the Sept. 27 demonstration which saw about 500,000 people take the streets and a special appearance by teenage activist Greta Thunberg, but it remained under pressure to do more.
The Concordia University Foundation makes investments with money donated to the school, and the returns are used to fund research, scholarships, and bursaries. In 2017, only five per cent of what was a $100-million endowment fund was dedicated to sustainable causes, meaning investments that have intentional social impacts. Within two years, Concordia has moved their investments to have just under six per cent of the fund invested in coal, oil, and gas, representing $14 million.
Chevrier has been doing work in finance theory and how it can be applied to sustainability. In 2013, he decided to start exploring what was going on at Concordia and push for more sustainable investing. That year, the Concordia Student Union started looking at Concordia’s investments and hired him to write two reports.
“Surprisingly, if you look at the plan I put forth in 2014, all the steps have been adopted [by Concordia] at this point,” he said. “It’s quite positive.”
At first, the ideas pitched by student activists weren’t taken very seriously. But, after listening to Chevrier push the idea that it wouldn’t lose any money through socially responsible investing, the university saw credence in his arguments.
A $5-million fund dedicated to socially responsible investing was started by the Concordia University Foundation. The idea was that if the fund did well, it would be expanded.
But, after that, the developments in sustainable investing began to stall. Chevrier said students were blocked from participating in extensive negative screening—which determines what kinds of investments the university will avoid. However, they did gain ground in other areas. In 2016, the Joint Sustainable Investment Advisory Committee was formed, and in 2018 the university signed on to the United Nations’ Principles for Responsible Investment.
The foundation also completely reviewed its investment policy to be environmental, social, and governance oriented, said Concordia’s chief financial officer Denis Cossette. Chevrier said the university started looking into impact investing—investing in things that will bring make a positive impact on the world.
“The committee opened a $5-million SRI fund after I gave my first presentation, so that was quite surprising. I’ve never made that much of an impact in a small time,” said Chevrier. “But after that, things got quite slow. We thought they were doing it as a greenwashing endeavour.”
External coordinator of Sustainable Concordia Emily Carson-Apstein said it’s clear the administration was doing a lot of work behind the scenes since then. They said that it’s very possible it was a stalling tactic, but that the university had received JSIAC’s message, or else divestment wouldn’t have gotten done so quickly. After all, the finance world typically moves very slowly.
That being said, working with the administration wasn’t always easy.
“There’s been a lot of student presentations, research, and discussions that weren’t necessarily listened to. The arguments being made by students have been going on for years, and for a long time they weren’t responding to it in a clear way,” said Carson-Apstein. “Students in 2014 were saying, ‘Here’s an example of a path you could take,’ and [the administration] was like, ‘No, no, no, that’s impossible,’ but the steps they are taking are very similar to what was recommended.”
Carson-Apstein stressed that the administration never disagreed with the students, but they had different priorities. But they highlighted that students have been lucky that the administration has been so open to working with them compared to other universities, like McGill, which won’t open up the dialogue with students.
Even a year ago, Carson-Apstein said, the negotiations were in the realm of a 20-year plan, and now Concordia has announced a five-year plan.
Concordia President Graham Carr acknowledged that some might find the 2025 deadline to be too far away, but he said it’s actually a very ambitious goal.
“I think pretty consistently over the years, the activities of the foundation have demonstrated that there’s a desire to go in that direction,” he said, emphasizing that the university community supportive of that orientation will do their “level best to meet the objective [they] set.”
“Part of the work that had already been done allowed us to decide, knowing what we know, what’s a realistic timeline,” he added. “Had we had this discussion two or three years ago, we would have ended up in a different place, but there’s been an important movement.”
Cossette said that many students, faculty, and staff have spoken out on the issue and have been heard. The working groups are putting together recommendations that will lead to the development of the sustainability roadmap in 2020. Now that divestment has been decided on, the university said it will remodel the way it works with students but will continue the dialogue with them through the JSIAC.
Carson-Apstein said one of the demands of the divest campaign has been to have student voices and representation on the committees, which, moving forward, they will continue to push for.
But divestment is only the first step, and it’s the easy part, said Cossette. The challenge will be in figuring out where to reinvest to make sure investments comply with sustainability first, while protecting the returns needed to continue supporting the endowment activities.
“Ideally the fossil fuel industry won’t exist in 20 years. If it does, we are not going to survive,” said Carson-Apstein. “So,  is a good timeline.”
In the bigger picture, if we look at democracy and democratic practices, the conditions of things coming into our world aren’t part of democracy, they’re controlled by people who have money.
— Erik Chevrier
The Future of Fossil Fuel Investments
The reality of things is that fossil fuels are no longer a good investment, said Chevrier, as they’re already starting to get phased out to reduce our carbon emissions.
In the Nov. 8 press release announcing the move, Howard Davidson, chair of the Board of the Concordia University Foundation, stated, “We believe that being socially and environmentally responsible in our investments is the surest way to be Concordia University’s best possible fund management partner. Investing in sustainability is not just the right thing to do, it’s the smart thing to do.”
Chevrier and Carson-Apstein also stressed that, ultimately, the $14 million Concordia will be withdrawing from the fossil fuel industry won’t make much of a difference, but the positive press will influence other institutions to follow suit.
Alice Wei, the finance coordinator of Sustainable Concordia, has been working on a sustainable investment project which came about at their 2018 annual general meeting. Sustainable Concordia had a budget surplus of $80,000 and allocated just over half of that to this project.
Their goal is to use $35,000 in investments and use the remaining money for internships and research. The research is divided into client development, equity research, and bond selection.
The idea of the project is to create a constructive dialogue between the investment community and those fighting for sustainability, said Wei.
The long-term goal is to build an exemplary portfolio that they can both present to the university and that can be used to educate other organizations on how to use investment for sustainability. Wei said there aren’t really models for sustainable investments available, and now is the time to come up with one on their own.
As a John Molson School of Business student, she found the mentality was always to chase profit, but that there needs to be a bridge built between the world of finance and sustainability.
The sustainable investment project will be investing its first $5,000 in February 2020 and will move from there. Wei’s biggest takeaway from this project is that the sustainable investing field is very new and growing.
“There’s no concrete way to do things; there’s no established, to-the-book strategy, and it’s still something everyone is trying to develop, so I think it’s a good time for sustainable investments,” she said.
The project’s biggest goal isn’t so much to make much of a difference with its investments, but rather to develop a methodology for sustainable investing for educational purposes.
The project has been presented to the JSIAC and was well received, said Wei.
“When we first made that presentation [to the administration], they were definitely delighted that we are tapping into this field,” she said. “Of course, they see our $35,000, which is nothing—they have millions and millions of dollars in their portfolio.”The university didn’t seem to be convinced at the time that the model could be scaled to this level.
“We have power with our money and we can choose to align our money with our values, and it’s easier than you think,” said Wei.
Carr echoed this sentiment. “I would hope this is a step toward reframing the conversation around sustainability,” he said. “The kind of enterprises or companies or industries that we want to invest in in line with the UN declarations are companies or organizations that are committed to sustainable future. So that’s a different kind of logic and I think it’s the kind of thing we’re seeing more and more institutions are trying to get their minds around.”
The Concordia University Foundation is investing $1.2 million in the global investment firm Inerjys Ventures, with the deal having been made in April. The Concordia-Inerjys deal aims to strengthen the clean technology sector as Inergys’ portfolio is invested in projects like AESP Green Energy and Goliath Wind.
AESP Green Energy is a Quebec-based renewable energy company that specializes in the development of off-grid solar solutions. Inerjys has engineered a partnership with French oil and gas giant, Total. Goliath Wind, based in Estonia, enables its partners to manufacture wind turbines at half the cost of similar turbines.
Chevrier maintains skepticism of sustainable investments. He likes to think of sustainability as “bringing positive things into the world and not negative things.” Based on that, one could conclude there’s no 100 per cent sustainable investment because there’s often collateral damage.
For example, electric cars are a good way to use less oil, but the resource extraction that goes into making one comes at a cost. The energy put into constructing motors for the cars can be problematic. Mining the lithium that stores the energy in the battery leads to other major issues, which is reflected in the current conflicts in Bolivia, one of the world’s poorest nations, which holds the second-largest amount of lithium in the world.
“What I want to claim here is that there is no 100 per cent sustainable investing,” said Chevrier. He believes divestment is only a stepping stone to a larger conversation that’s necessary. He said finance is what dictates what does and doesn’t get produced in our culture.
“In the bigger picture, if we look at democracy and democratic practices, the conditions of things coming into our world aren’t part of democracy, they’re controlled by people who have money,” he said. “The bigger picture concerns me a lot.”
Chevrier said the next step will be to look at investment portfolios in general and only invest in things that bring positive things into the world socially and environmentally, but that is harder than it sounds. For example, movements like Boycott, Divestment, and Sanctions aren’t seen positively by the administration, and Concordia still uses Aramark for food distribution despite its controversial labour conditions and food safety issues, like having maggots in the food it provides to prisons.
“Where the money goes is what dictates what comes into the world,” said Chevrier. “We look at democracy and we say, ‘We voted for this person to uphold decisions,’ but we’re realizing the political institutions are being controlled by finance also. […] If we want to fight problems like climate change we need to have control over these mechanisms.”