In April 2021, the Academic Senate of the University of Utah approved a report evaluating whether endowment fund investments in fossil fuels balance the institution’s economic, ethical, community and environmental stewardship. That report was then shared with the University of Utah’s Board of Trustees.
The full discussion by the board can be watched at the bottom of this page.
A shared commitment
- The university’s Board of Trustees is grateful for the thoughtful and comprehensive work of stakeholders across campus, including ASUU, the Staff Council and the 16-member Academic Senate Ad Hoc Committee for Divestment and Reinvestment Investigation who provided the impetus and the research for this initiative over the past year.
- As the body responsible for the stewardship of the university’s endowment funds (currently at just over $1 billion), the Board of Trustees agrees with, and endorses, the report’s final conclusion that:
- “The university should modify its existing investment pool guidelines and implementation strategy to establish principles and approaches that further its established charitable purposes regarding climate change and sustainability, as well as its fiscal goals, in future endowment investment decisions.”
- The Board of Trustees notes this approach is consistent with the priorities of Utah’s elected leaders as outlined in their 2018 Concurrent Resolution on Environmental and Economic Stewardship that states:
- “We should prioritize our understanding and use of sound science to address causes of changing climate and support innovation and environmental stewardship in order to realize positive solutions”
- And encourages state entities “to reduce emissions through incentives and support of the growth of technologies and services that will enlarge our economy in a way that is both energy efficient and cost effective.”
- More on the state’s approach is available via the Kem Gardner Policy Institute’s 2020 study: The Utah Roadmap Positive solutions on climate and air quality.
A new approach
- This new approach to investment acknowledges the ethical and operational complexities of moving toward the university’s goal of carbon neutrality by 2050 in an economy and civilization that has been heavily reliant on fossil fuels. The natural and manmade systems affected by our changing climate are complex and interconnected, and the University of Utah must be part of the solution.
- The board recognizes that the future of energy is changing rapidly. While the benefits of this change will be felt globally, we share the concern that many rural counties in Utah could face a negative economic impact. The university must remain committed to working with leaders in these communities to minimize unintended or negative economic consequences. As the state’s flagship university, our commitment is to help all 29 counties in Utah thrive. Working together, we believe the benefits will be for all of Utah and all sectors.
- The board recognizes the important role traditional energy continues to play in Utah’s economy, and in particular, the economic livelihood of rural parts of our state. We appreciate the hard work of so many individuals in these industries and their role in helping to grow our state. Their thoughtful generosity has enabled the university to grow and excel.
- We recognize that energy transformation is a process and one we are all taking together. By working together with many of our industry partners in these sectors, we will be able to accelerate the energy transformation and achieve a cleaner and more sustainable world.
- Through prudent and balanced leadership and an emphasis on innovative research, the university is positioned to help propel economic opportunity throughout the state.
- We are committed to working with local and state leaders, as well as industry partners, as we transition and work toward carbon neutrality.
The board’s vision
- Our planet’s changing climate and air quality represent an existential threat to communities and ecosystems worldwide. It is a global crisis requiring a global effort to mitigate the effects of a warming world.
- Achieving sustained clean energy must be balanced, solution-oriented and evidence-based. It will require continued leadership, scholarship, research, and analytical thinking, something for which the university, as the state’s flagship university and the region’s largest research university, is uniquely positioned.
- The university’s investment strategy should achieve healthy financial gains over the long term by investment in funds and companies that share the university’s values.
Building on the U’s leadership in clean energy
- The university has already made significant progress toward implementing sustainable best practices. These include the following:
- More than half of the U’s electricity is now sourced from geothermal, solar and hydroelectric sources.
- Achievement of GOLD designation from the Sustainability, Tracing, Assessment & Rating System (STARS) in January 2021.
- Reduction of campus greenhouse gas emissions by more than one-third since 2007.
- Continued investment in interdisciplinary sustainability research, led by the Global Change & Sustainability Center (GCSC).
- An increasingly integrated and comprehensive approach to sustainability across campus under the guidance of new Chief Sustainability Officer Kerry Case.
- Continued curricular efforts to foster sustainability literacy in every student.
- President Taylor Randall’s re-signing of the Presidents’ Climate Commitment and active membership in the University Climate Change Coalition.
The U’s continuing commitment to rural Utah
- The Utah Coal Country Strike Team: In this locally led effort, the University of Utah partners with a team of community leaders to raise incomes and diversify the economy in Carbon and Emery counties.
- The Strike Team, which was a finalist in the 2019 national competition sponsored by Schmidt Futures, pursues a four-fold strategy, including workforce training, housing revitalization, tourism infrastructure, and economic development policy research.
- The Strike Team, with the support of the Utah Legislature, Schmidt Futures and the University of Utah, invests in the economy and helps residents achieve a more economically stable future.
- Investments and innovative policy steps include the following:
- Scholarships: 137 student scholarships to train and retrain Utah’s coal country workforce.
- Teacher training: Grants to Carbon and Emery School Districts to help fund high-quality computer and information technology teacher training.
- Placemaking: Grants to Price City and Castle Dale City to assist with downtown beautification and Main Street revitalization.
- Tourism infrastructure: Grants to Carbon and Emery counties and Price City and Castle Dale City to assist with tourism infrastructure.
- Co-working space/entrepreneurism: Funding to renovate co-working spaces in Carbon and Emery counties that support remote work and local entrepreneurism.
- Marketing: Assistance with small business global marketing and business outreach.
- Housing: Assistance with land and materials for a sweat-equity housing construction program.
- Tech industry: Signing of a charter with Silicon Slopes that creates a Silicon Slopes East Chapter.
- The effort serves as a national model for how a public university can organize a multi-disciplinary, data-driven, and mission-focused “Strike Team” to help coal-dependent communities.
- University of Utah Health:
- The Tribal, Rural and Underserved (TRU) communities program helps leverage medical education to address primary care physician shortages in Utah’s most underserved communities.
- The Rural & Underserved Utah Training Experience (RUUTE)program works to improve medical education and training, health care access and long-term socio-economic benefit for rural and underserved communities of Utah and the intermountain west by expanding interest, awareness, and placement of students and physicians.
- The Graduate Medical Education Resident Engagement & Training for Underserved & Rural Needs (RETURN) provides graduate medical education trainees clinical and cultural exposure to Utah’s rural and underserved health needs.
- Clinical access to rural communities via 74 telehealth programs across six states (Utah, Idaho, Colorado, Nevada, Wyoming, Montana), including six acute services/specialties: Telestroke, TeleNeurology, TeleBurn, TeleICU, TeleCrisis, TeleNICU.
- University of Utah Energy & Geoscience Institute and U.S. Department of Energy FORGE project: $140 million investment from the U.S. Department of Energy over five years to build an experimental geothermal laboratory near Milford, Utah.
- University of Utah College of Mines and Earth Sciences: $1.5 million project from the U.S. Department of Energy to study the potential of transforming coal-associated mineral resources in Utah and western Colorado’s Uinta Basin region into high-value metal, mineral and non-fuel carbon-based products.
- Following the planned retirement this year of the university’s Chief Investment Officer Jonathan Shear, we have asked the university’s administration to recruit a new chief investment officer with responsibility for managing a values-based endowment pool.
- Of note, we are grateful for Jonathan’s stewardship of university funds during his career. Under his leadership, the university’s endowment has grown to more than $1 billion and has consistently provided stable and increasing cash flow to support the university’s mission.
- The first task of the new chief investment officer will be to craft a plan to clearly align the university’s investment strategy with the institution’s values and mission, including responsible stewardship and financial returns. The plan will include regular reports to the campus community on the performance of the investments and alignment with the university’s values. The new investment plan will balance the social impacts of investment and fiduciary duty. Companies in the university’s investment portfolio will be regularly evaluated and reviewed based on their actions and progress to ensure continued alignment with the university’s values.
- A subcommittee of the board will continue to review the Academic Senate report’s eight realignment recommendations.
- The board plans to continue an open conversation on strategic reinvestment and looks forward to sharing that plan with the campus community for feedback and comment in the coming year (2022).