Pushed by students, universities lead on fossil fuel divestment. Who will push foundations?

This story is part of the Future of Good editorial fellowship covering the social impact world’s rapidly changing funding models, supported by Community Foundations of Canada and United Way Centraide Canada.

On April 4, 2019 Julia DaSilva and a group of about 20 other students gathered on the steps of Victoria College at the University of Toronto, preparing to storm a board of regents meeting taking place inside. They wielded colourful signs — “Keep oil in the soil,” “Divestment timeline now,” — and a five-foot banner that loudly proclaimed: “It’s not an investment if it wrecks the planet.”

After the rally, students marched into the lobby of the imposing building. The boardroom door was unlocked so they chanted their way inside, presenting board members with a petition, calling on the college to commit to a clear timeline for divestment of the school’s endowment from fossil fuels. 

The direct action was one part of a three-day ‘DivestFest’ — itself, part of a near-decade-long campaign to push the University of Toronto and its federated colleges to divest all capital from fossil fuels. And on this day students were hopeful. They’d managed to secure nods of support for divestment from many faculty members, from Victoria College’s student council, and even privately, from some members of the college’s board of regents, DaSilva says. 

But despite their momentum, the board refused. They would not commit to a timeline for divestment. 

It was a “turning point,” in the student’s campaign, DaSilva says. “It showed us how much of an administrative wall we were really facing.” And it burst the status-quo notion that students and administrators at the college were “one big family.” 

After that, students continued to turn up the pressure. They coordinated a large contingent to participate in the global climate strike. Some students created “spoof merch” — buttons and posters, mocking the school’s “Boundless” marketing campaign, suggesting that rather than contributing to ‘boundless possibilities,’ the school was in fact contributing to ‘boundless destruction’. And they continued to raise awareness amongst their peers about divestment, through webinars, teach-ins and nature walks. 

But during this period, student organizers weren’t very optimistic about their chances for success. They hadn’t heard anything to suggest the school was pushing forward. 

That’s why in late October 2021, student organizers were “shocked” when the school’s president, Meric Gertler, announced that University of Toronto would divest its $4 billion endowment from fossil fuels.  

In the immediate aftermath, DaSilva has been hesitant to draw a clear line of causation between any one rally, protest, or campaign, and the decision taken by the school’s leadership to divest.

But experts, like Naomi Maina, a PhD candidate at the University of Saskatchewan’s school of environment and sustainability, says that the role of student and faculty-led organizing in driving university divestment is undeniable. The proof, she says, is in the pudding. Amongst the 11 Canadian universities who have committed to full or partial divestment from fossil fuels over the past decade, all but one have had active student or faculty-led divestment campaigns. 

The same is true in the United States, says Jennie Stephens, a professor at Northeastern University. “In the past couple of months, we’ve seen a flurry of universities, including Harvard University and Boston University, finally divest.” This comes after “years and years” of “relentless pressure” on the part of student and faculty organizers, she says. 

But in the broader Canadian philanthropic sector — where 10,000-odd public and private foundations contribute to a wide variety of social causes — the situation is markedly different. So far, just a handful have publicly committed to fossil fuel divestment. And those who have divested have been motivated by internal forces, says Devika Shah, executive director of Environment Funders Canada. 

“For most of the early movers, the motivation was their own values,” she says. “They didn’t have any sort of major external pressure.” 

But as the battle to curb climate change continues, getting additional foundations to take action on fossil fuel divestment may take external pressure, according to experts who spoke to Future of Good for this story. And while there is no clear analogue to students in the philanthropic universe, several actors, namely — board members, donors, grantees, and staff — could play crucial roles.

‘The aim was to erode their reputation as a green university,’ student activist says

Fossil fuel divestment campaigning began in earnest on college campuses in the early 2010s, led by students at Swarthmore College in Pennsylvania. On spring and fall break, Swarthmore students traveled to West Virginia where they learned about mountaintop coal mining — a type of mining common to the Appalachian region where mountaintops are blasted off to expose coal seams. “Visiting West Virginia made it clear that composting at Swarthmore College wasn’t going to stop the coal industry,” one former organizer writes. Subsequently, students poured their energy into calling on their institution to divest their endowment from fossil fuels. 

Energy from this campaign quickly spread across the country and the border, supported by non-profit environmental organizations like 350.org, the Divestment Student Network and the Canadian Youth Climate Coalition. By 2019, there were 38 active fossil fuel divestment campaigns at colleges and universities across nine provinces in Canada. And among them, 31 were led by students. 

For students on both sides of the border, the motivation for the campaigns were similar. While students were keen on having their institution’s investments better aligned with their values, their advocacy was also aimed at making “it less socially acceptable to operate fossil fuel companies,” writes Maina, in an article on the subject. This, students believed, would lead to a drop in government subsidies and less favourable media coverage for fossil fuel companies, making it tougher for them to continue to drill, frack and blast. 

But students pursuing this activism didn’t often start off with a bang. Most campaigns began softly — by students presenting research, a petition or an open letter to their institution’s board of directors. And at some schools, this was all it took to prompt a divestment vote. 

At many institutions, though, these tactics did not lead to divestment. And so, frequently, students escalated their activism. They hosted sit-ins in the president’s office, blockades at board of director’s meetings and colourful media stunts. 

This has been the case at the University of Victoria, where after years of advocating to administrators through petitions and meetings, students escalated the tenor of their activism in 2019 and 2020. In one instance, they blockaded an administrative building, after having been denied the opportunity to deliver a letter about divestment to the president of the school. In another, they painted the cement outside of the university president’s office, with a large blue and black mural, calling on the university’s new president to divest. And in a third, student organizers erected a divestment billboard on the well-travelled Patricia Bay Highway, alerting passersby that the University of Victoria Foundation had $70 million invested in fossil fuels. 

In pursuing direct action, student organizers have focused on a variety of different ‘pressure points’ — sensitivities that create openings to push for divestment. At UVic, students have focused heavily on making the ‘moral case’ and ‘economic case’ for divestment to both board members and the president of the school. And when those didn’t work, student organizers targeted the institution’s brand, says Emily Lowan, a student activist involved in the campaign.

“The idea was that all of these students, travelling to campus for the first time, their parents, and donors — they should be aware of all of the greenwashing that UVic does,” she says, of the billboard stunt. “The aim was to erode their reputation as a green university — and to suggest that divestment is a non-negotiable to being able to proclaim that status.” 

And it’s not just UVic students who have targeted this pressure point. So too did UofT students in creating their ‘boundless’ spoof buttons.

“Public shaming wouldn’t usually be the first step a campaign takes. But it can be a powerful tool when you’re making a moral argument for an institution that wants to be seen as moral,” says Kristen Perry, a former organizer with Divest McGill and a member of Resource Movement (where, full disclosure, she and I volunteered together). 

Donor dollars are yet another pressure point targeted by students in their divestment organizing. 

At McGill University, for instance, student organizers were able to convince a donor to withhold a $2 million donation from the institution, as a result of the school’s unwillingness to commit to fossil fuel divestment, according to Perry. 

To draw further attention to the donor’s decision, student activists recorded a speech given by the donor’s portfolio manager describing why her client had decided to cancel the donation, and then played this recording on loud speakers outside of McGill’s board of governors meeting. “That was one thing that they really didn’t like,” she says. 

Targeting donors was particularly sensitive, Perry says, because McGill University, and institutions of higher education like it across the country, rely on donors to meet their budgets and grow their endowments. 

And while this organizing hasn’t always been popular with Canadian institutions, it does seem to be working. In the last six months, several schools have committed to full or partial divestment,  bringing the total committed divested assets of these institutions to nearly $10 billion, according to data compiled by Stand.Earth — a mammoth sum in the Canadian philanthropic landscape.  

Why haven’t public and private foundations faced the heat on fossil fuel divestment? 

But despite their similar philanthropic profile, non-University public and private foundations in Canada have not faced similar scrutiny from their stakeholders regarding fossil fuel divestment. 

And the impact of the absence may correlate with the relative few public and private foundations who have decided to divest from fossil fuels. While many foundations have now adopted some form of environmental, social and governance screens (ESG), Future of Good was able to identify just seven public and private foundations that have publicly committed to fossil fuel divestment: the Catherine Donnelly Foundation, Trottier Family Foundation, MakeWay Foundation, Comart Foundation, Inspirit Foundation, World Wildlife Fund Canada Foundation and North Family Foundation. 

Amongst them, it’s a nearly even split between public and private foundations. And most are mid-size, holding assets of about $40 million. 

According to several experts, the biggest reason why public and private foundations haven’t felt more pressure on divestment is the noticeable absence of students (or a stakeholder group like them) in the philanthropic landscape. 

“[Foundations are] not in the same position as the universities where they have this huge external stakeholder group — students — who are putting pressure on them and who in many ways they are accountable to. For most, the strongest accountability is internally, to their boards,” says Devika Shah. 

For educational institutions, students represent both their key customer segment and their raison d’etre, making their demands high priority within the institution. 

“When a university gets something wrong, there are stronger tangible repercussions — they lose out on enrollment and they also have a lot of really angry people at their door,” says Shah. “When most public or private foundations get something wrong, they’re less likely to face significant tangible external repercussions in the same way.” 

But despite the absence of students, experts say that there are several stakeholder groups that could exert pressure on foundations to push for divestment. 

The crucial role of board members in spurring divestment

In 2015, Claire Trottier, a board member of the Trottier Family Foundation, put their family’s investment advisors on notice. The family wanted to divest their (then) $60 million endowment from fossil fuels and wanted their advisors’ help in making it happen. 

For Trottier, the conversations with the financial advisors were intimidating. She and her sister Sylvie had been invited by their parents to join the board just a year earlier. And this was Claire’s first time meeting their financial advisors — meetings she describes, with a laugh, as “a parade of mostly men in suits.”

When the daughters joined the board a year earlier, they made reviewing the foundation’s investments an early priority. “When we looked at the list of companies that the investment managers are invested in [we saw] all these big oil and gas companies. And it was like, ‘Wait, no. This is not aligned with what we’re doing [as a foundation],’” she says. (Full disclosure: Claire and Sylvie are also members of Resource Movement, where we’ve volunteered together). 

At the time, the foundation had begun devoting an ever-larger share of donations to charities working on solutions to the climate crisis. And for the daughters, holding fossil fuel investments lacked coherence with their foundation’s mission and lacked alignment with their personal values. 

So they initiated a conversation with the board — their mother, father and uncle. And to their delight, all three were open-minded to the idea, they’d just never really considered it before, Claire Trottier says. 

Within a couple years, divestment was complete. “To their credit,” Trottier says, “all of [our financial advisors] came back with some version of a solution — because we’re the client and we’re asking for it.” 

And demographic shifts may soon create more opportunities for board-shifts of this kind. 

Within the next decade, Baby Boomers will initiate the largest intergenerational wealth transfer in Canadian history, passing more than $1 trillion in personal wealth to their descendants as they age, according to Manulife. For some foundations — in particular, private family foundations — this generational change could come along new additions for their boards. 

And as with private foundations, board members of public foundations also have an important role to play in divestment, says Jonathan McPhedran Waitzer, a member of the North American steering committee for EDGE Funder’s Alliance and of a member of Resource Movement.  Though they’re not likely to stage a sit-in in their own office, trustees could “break rank” in other significant ways, they say, including through proposing a vote on fossil fuel divestment or writing an op-ed in support of divestment in a relevant publication or forum. 

And in encouraging such behaviour, it’s crucial that actors pressuring foundation board members “responsibilize” them, says Perry. 

“With McGill, board members and university leaders were able to ‘de-responsibilize’ themselves personally, because they could just say, ‘Oh, the finances of this institution are the most important thing so that we can continue our mission.’”

To combat this, student activists had conversations with individual board members focused on their personal legacy as a member of the board. “If you can personally ‘responsibilize’ people for the decisions they’re making, I think it makes a big difference in the outcome.” 

Donation strikes, ‘friendly’ grantee activism, and the role of younger foundation staff

Experts also see the potential for divestment activism amongst three other stakeholder groups: donors, grantees and foundation staff. 

For public foundations, donors could play a key role in pushing for divestment, says Perry. “Donors can be seen as investors in the foundation, so they could take inspiration from ‘shareholder activism’ to create change.” 

And as is the case in shareholder activism, Perry says that voicing opposition to existing policies publically is important in seeking to make change. 

“I think if someone were to publicly declare, ‘I’m not donating to this foundation for these reasons,’ even if it was a smaller group of people or funds, the foundation would immediately be anxious that it was going to catch on with other donors.” 

While ‘donor strikes’ are uncommon, they’ve caused a stir in the past. In 2009, donors withheld over $1 million in donations from members of the U.S. congress who refused to support a bill aimed at reducing the influence of lobbyists in politics, according to Mother Jones. And in 2015, donors, including Ben and Jerry (of ice cream fame) withheld over $30 million in donations to American Democratic politicians who were opposing diplomatic negotiations with Iran, according to non-profit MoveOn.org. To date, however, it appears that donors have never targeted divestment activism through donation strikes. 

In addition to the possible role for donors in divestment advocacy, Perry and McPhedran-Waitzer also believe grantees could be a powerful force. 

“It could be more of a friendly campaign start, like a collective letter signed by a group of the foundation’s recipients,” says Perry. “The letter could underline important values that the fund’s investments contradict, and then offer resources and collaboration to advance this work of aligning funds with values.” 

Though it is common for grantees to sign policy statements, outlining their position on educational, healthcare or criminal justice reform, it’s rare that grantees explicitly target their own funder’s actions. And this is for good reason, says McPhedran-Waitzer, given the “vulnerability of individual grantees to their respective funders” in maintaining their budget. 

Another prospective source of advocacy could come from foundation staff, says Farhad Ebrahimi, the president and founder of the U.S. based Chorus foundation, which has never held any fossil fuel investments. 

“​​Foundations’ program staff are the ones who are actually meeting community members and building relationships and things like that. And so they’re likely to be the first to come back to be like, we should be doing things differently.” 

McPhedran-Waitzer agrees. “It would be really powerful to have a bunch of senior staff at a few foundations talking about how they think that divestment is the right thing to do,” they say, proposing a conference session as a suitable forum for such a declaration. 

“I think it would probably come from a community of practice of more junior and mid level staff who are building momentum” towards such a declaration, they say.

What about philanthropic networks or foundation-focused activism? 

Outside these actors there may be two other more obvious groups who could pressure foundations toward fossil fuel divestment: philanthropic support organizations, like Philanthropic Foundations Canada or Environment Funders Canada, and activist groups (either newly-created groups focused on philanthropic divestment or existing climate activist groups that take up the fight against foundations). But, experts say, divestment advocates shouldn’t hold their breath waiting for either of these groups to save the day. 

“It’s not the role of funder networks like EFC, PFC and CFC to engage in direct action against our own members,” Shah says. “Our role is very much a support and leadership and teaching and convening type of role.” 

The recently-launched Canadian Philanthropy Commitment on Climate Change is a good example of this kind of work. Launched by EFC, PFC, CFC and The Circle, the pact is an “invitation” to Canadian foundations to commit to seven pillars of activity that signal commitment to act on climate change. 

The commitment is designed “to be ambitious,” says coordinator Marie-Marguerite Sabongui, “but also not alienate vendors that are just starting on climate.” In this way, it uses a ‘big tent’ strategy — gently pushing it’s members and signatories, but not forcing. So far, 26 Canadian foundations have signed the pledge, committing to “consider climate change in relation to the source and management of [their] operational and any endowed funds,” along with several other policies. 

So then, what about activists? 

Activism around fossil fuel divestment in philanthropy could come from two sorts of activist groups, McPhedran-Waitzer says. First, it could come from existing climate justice groups, like Climate Justice Edmonton, 350.org, or Climate Justice Toronto, deciding to focus their energy on philanthropic ‘targets’. Or could also come from activist groups active within philanthropy, such as Resource Movement, deciding to focus their energies on fossil fuel divestment. 

But both types are limited by their resources and using their existing capacity elsewhere. 

In some sectors, foundations provide resources to activist groups and non-profits to boost their capacity, supporting them to engage in direct action campaigns aligned with the foundation’s mandate. But it’s unlikely that foundations will fund activism against themselves, says Ebrahimi. 

“Foundations whose investment portfolios don’t look so good themselves are probably unlikely to fund some sort of campaigning effort to go after their peers in philanthropy,” he says, “because, you know — they’d look like hypocrites.” 

Ebrahimi chalks this up to a “deeply problematic” culture of “mutual protection” that pervades the philanthropic sector. Within this frame, he says, even foundations who have divested from fossil fuels are also reluctant to fund a direct action “toolbox” or contribute to an “overall culture” that could be “used against [them] in another context,” or on another issue area.

The need for ‘inside’ and ‘outside game’ organizing to push for divestment

This absence of a force that offers direct critique or forceful direct action poses a big problem in creating the conditions for more fossil fuel divestment or other progressive changes in the philanthropic sector, says McPhedran-Waitzer. 

“My perspective is that the biggest weakness in the Canadian philanthropic organizing period is our lack of outside power,” they say. Without activist groups creating external pressure for foundations, ‘inside game’ groups, such as Environment Funders Canada or pro-divestment foundation staff, have a tougher time making the case for progressive changes.  

“You need those more radical voices and those more radical movements. And you need people who are on the inside who can bring those ideas in a way that meets people where they’re at,” says Claire Trottier.  

Over time, she says, this can help “make the formerly radical no longer at all radical.”  

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