McGill University Divests. It is one of the top universities, and in 2024, it will divest all direct holdings in fossil fuel companies.
In December 2023, McGill University in Montreal, Canada, announced that it would divest from all direct holdings in fossil-fuel companies listed in the Carbon Underground 200, implementing in 2024 and completing by 2025.
McGill University is one of the top universities not only in Canada but around the world. It is a world-renowned institution of higher learning with research activities and over 40,000 students. The university has a reputation for its chemistry, medicine, and biology programs.
Their sustainability commitments have been ongoing for decades. Some notable actions include committing to zero waste by 2035 and achieving carbon neutrality by 2024 by reducing emissions. McGill University has also been recognized as a global sustainability leader, placing 13th out of 1397 institutions worldwide in the 2024 QS World University Sustainability Rankings.
Divesting from fossil fuel companies has been a long time coming as it has been claimed by the university that divesting from fossil fuel would pose a financial risk to the institution. In fact, McGill University had already decided against fossil fuel divestment three times in 2013, 2016, and 2019. Meanwhile, other Montreal universities, such as Concordia University and Université du Québec à Montréal, were already committed to fully divesting from fossil fuels.
The McGill University divestment announcement says it will divest from direct holdings in Carbon Underground 200 fossil fuel companies is great news in their efforts to reduce their environmental impact. It may also come as a sign of relief from organizations like Divest McGill, who have been fighting for this cause since 2012.
Carbon Underground 200 is the top 100 coal and the top 100 oil and gas publicly-traded reserve holders globally, ranked by the potential carbon emissions content of their reported reserves. McGill University’s divestment will involve the liquidation of the remaining direct CU200 holdings within the McGill Investment Pool (MIP). As of December 2022, these holdings constituted just 0.5% of total MIP assets.
From 2019 to 2022, McGill University has focused its divestment efforts on firms that may not extract fossil fuels directly but use them in highly emissions-intensive industries such as coal and gas-fired electricity generators. These efforts have helped them to remove about 73,000 tonnes of annual carbon emissions from the MIP. Moreover, their sustainable investment strategy has already slashed McGill’s Investment Pool’s listed equity portfolio carbon footprint by 49% since 2019.
In addition to the McGill University divestment announcement, it also announced new commitments towards sustainable investments, which include:
- Sustaining a carbon footprint of at least 33% below the emissions generated by companies in McGill’s listed equity and fixed income benchmarks.
- Continuing to offer a fossil-fuel-free fund to McGill donors
- Improving the McGill’s United Nations Principles for Responsible Investment score
- Integrating an Environmental, Social & Governance scoring system into their fund manager monitoring processes.
- Enhancing their engagement initiatives by broadening the scope of topics to encompass social and governance considerations while continuing to address climate change.
- Allocating 10% of the MIP to Sustainable Investment Strategies aligned with the United Nations Sustainability Development Goals by 2029.
While there is still a lot of work to be done for McGill University to achieve its sustainability goals and reduce its impact on the planet, divesting from direct holdings in Carbon Underground 200 fossil fuel companies is one step towards achieving its goals.
As a world-renowned university, the McGill University divestment announcement can lead as an example for other universities who have hesitated over the years to divest from fossil fuel industries and can be encouraged that change is possible. With actions taken by big institutions like universities, we will see positive change.
