The Rockefeller Brothers Fund announced their decision to join the divestment movement last week, pledging to sell assets tied to fossil fuel companies from their portfolios and to continue investing in cleaner energy alternatives.
The Rockefeller Brothers Fund is a $860 million philanthropic organization that provides grants to promote democratic practices, peace building and sustainable development. It was established by the sons of John Rockefeller Jr. in 1940, according to the organization’s website. His father, John Rockefeller Sr., was a co-founder of Standard Oil and is often cited as the richest person in history when adjusted for inflation.
“One of the things we’ve focused on has been climate change and an effort to reduce greenhouse gas emissions,” Steven Rockefeller ’58, a son of Nelson Rockefeller and a trustee of the Fund, said in an interview with The Daily Princetonian.
Rockefeller said he strongly approved of the board’s decision to divest, which stemmed from discussions on how the Fund could bring their endowment investments closer to the organization’s goals and incentives.
The move adds to piling pressure for funds and especially college endowments to divest their investments from fossil fuel holdings. Movements for divestiture have been active at many college campuses, including Divest Harvard and the Fossil Free UC campaign. In May, Stanford University dropped coal-mining stocks from its endowment. So far, Princeton has declined to disclose its investments or to join the divestment movement.
Senior Program Officer for the Environment at the Wallace Global Fund Richard Mott said that the divestment announcement is really historic, noting both the source of the Rockefeller fortune and the foundation’s size and influence.
“When you have the heirs of J.D. Rockefeller say that this is the time to move away from fossil fuels, it’s a strong signal,” he said.
The announcement was made a day before the United Nations Climate Summit in New York City and included both a message from actor Mark Ruffalo and a videotaped message from retired bishop Desmond Tutu, according to The New York Times.
The Fund also decided to commit at least 10 percent of its endowment to investments in clean energy, Rockefeller said, and has already eliminated investments involved in coal and tar sands from its portfolio.
Rockefeller said he is very opposed to the Keystone XL oil pipeline running through Canada and the United States, a government project awaiting approval for its final phase. The pipeline spurred student protests at the White House earlier this year.
In addition to the social and environmental benefits of divesting, Rockefeller said he believes companies that divest now will enjoy economic benefits in the long run, as the current consumption of fossil fuels is clearly unsustainable.
“These oil companies will face some very, very serious financial problems,“ Rockefeller said.
The birth of the divestment movement is commonly accredited to college campuses, where students first staged protests against fossil fuel investments. Mott said he thinks it will become more and more difficult for universities to reject divestment due to possible financial losses.
“I think it was never correct and it only becomes less flexible,” Mott said of the economic feasibility argument against divestment. “The risks are predominantly from staying in fossil fuels.”
Mott noted that since the first universities began eliminating coal investments from their portfolios, coal stock went down by 60 percent. If colleges had acted earlier, he said, they would have benefited financially.
Mott added that academic institutions have taken social stances through endowment investments before, such as divesting from tobacco companies. He said that it is a university’s greater mission to support the social good and to help create a viable job market for its students, not to bet on unsustainable resources.
“I think we’re facing a critical moral issue, and my hope is that Princeton, colleges and universities across the country will join and support the divest initiative,” Rockefeller said.
The University does not disclose the details of its investment portfolio to maintain a competitive edge, University spokesperson Martin Mbugua said.Andrew Golden, president of thePrinceton University Investment Company, which manages the University's endowment,declined to comment for this article.
The Council of the Princeton University Community resources committee, which considers issues related to the University's endowment portfolio, does not discuss the Rockefeller Brothers Fund's investment policies, Director of Public Affairs and staff committee representativeKaren Jezierny said in an email.
Although Mott said some people claim that individual companies divesting does not have much of an impact on stock prices, he said it’s already made a very big difference.
“Industries are being called upon to defend their business model,” Mott said, adding that 168 institutions have already joined the movement. This translates into an aggregate of more than $50 billion removed from fossil fuel investments, Mott said.
“I’m encouraged by the positive response and media interest that the Rockefeller Brothers Fund announcement last week has generated,” Rockefeller said. “It’s given me some new hope that perhaps the shift in the public mind may now really be taking place.”
The University’s Rockefeller College was named after John Rockefeller III, who was a longtime trustee of the University and who contributed $7 million to further construction in 1984, according to The New York Times. Six years later, Laurance Rockefeller donated $21 million to the University to create the Center for Human Values.
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