April 1, 2015
FACULTY SENATE MINUTES
April 1, 2015
Present: Steve Barkan, Ian Bricknell, Dick Brucher, Stephen Coghlan, George Criner, Mauricio da Cunha, Paula Drewniany, Gordon Hamilton, Jason Harkins, Marie Hayes, Zhihe Jin, Scott Johnson, Leonard Kass, Irving Kornfield, Jordan LaBouff, Robert Lilieholm, David Marcinkowski, Robert Milardo, Grant Miles, Patti Miles, Jennifer Moore, Martha Novy-Broderick, Harlan Onsrud, Michael Peterson, Andrew Reeve, Brian Robinson, Jonathan Rubin, Thomas Sandford, Michael Scott, Howard Segal, Kathryn Slott, Allan Smith, David Townsend, Shihfen Tu, David Yarborough, Bob Rice, Jeff Hecker, Carol Kim, Ryan Low, Peter C. Altmann (CEAC), Meghan Sills (Grad Stud Gov.),
Absent: John Allen, Bob Bayer, Jason Bolton, Sudarshan Chawathe, Charlsye Diaz, Scott Dunning, Thane Fremouw, Robert Gundersen, Dorothy Klimis-Zacas, Mary Ellin Logue, Sidney Mitchell, Deborah Rogers, Mary Shea, Owen Smith, Gail Werrbach, Clayton Wheeler, President Susan Hunter, Robert Strong, Charles Rote, Deans Council Rep, Bonita Grindle (PEAC), Lindsay Nutter (Stud. Gov.)
The meeting was called to order at 3:18 pm
I. Welcome, Announcements and Comments:
II. Approval of Minutes
February minutes will be voted on in May.
III. Committee Reports
BOT Rep – Robert Rice –
The BOT met on March 15 & 16. The Chancellor is still discussing One University with seven campuses mission. The NEASC accreditation, covering all system campuses, came up. NEASC has given a number of conditions that the system is working in teams to address. Ellen Chaffee, APRIP chair, made a couple comments questioning the mission of APRIP. She wondered why APRIP groups are trying to coordinate programs but the Presidents’ Council will determine what programs will be at what campuses. The unified budget was discussed and the business model; there have been some delays in the process. The System has hired a firm to develop a model across all campuses where all services will be consolidated. If they recommend the plan there will be specific positions that coordinate all financial issues at the system level. There was discussion regarding the stolen computer, 900 names with 600 having detailed identifying information. The budget; $3 million increase from the state, which still leaves an $8 million needing to come from reserves. Revenue is down by about $9 million with a 4% decrease in personnel.
Academic Affairs – Marie Hayes
Associate Provost Monique LaRocque spoke with the committee regarding changes in online courses. Winter Term was discussed regarding projected offerings, etc. The committee also discussed the System goals to meet needs and get students graduated in four years. Andrei Strukov, of the Faculty Development Center, was present to discuss his work. Faculty Development does many things to assist faculty with technology. There was a report from the sub-committee regarding the current Sexual Harassment policy on campus. They will meet with Dr. Robert Dana and Karen Kemble and their committee, at a future meeting. IT was discussed; Mike Scott stated that there is an initiative from the Provost’s office to discuss Faculty Development consolidation on the 29th of April.
Provost Hecker said they’re trying to bring together faculty support and development that is spread out all over campus. They want to bring everyone from the different entities to discuss how to bring all services together. Create a hub so it’s easier for faculty to find services they need.
Constitution & Bylaws – Martha Novy-Broderick
Considering a review of Emeriti faculty.
Research & Scholarship – Scott Johnson & Mauricio de Cunha
There is a motion under New Business. Mauricio mentioned that the committee is compiling data from the faculty survey. They sent out 1,000 surveys and received 180 responses.
Finance & Institutional Planning – Tom Sandford
No report.
University Environment – Mike Scott
No Report.
Library Advisory – Robert Rice & Howard Segal
Joyce Rumery, Dean of Libraries, and fellow Librarians met last week regarding a resolution with procurement. The committee will meet soon. Things are moving but there is no resolution at this time. Rudy Gabrielson will be at the April 15, 2015 Faculty Senate meeting. He’s been asked to discuss non-commodity issues associated with research and education.
Service & Outreach – David Yarborough & Jason Bolton
No report.
Committee on Committees – Executive Committee
No report.
Program Creation & Reorganization Review – Brian Robinson
The committee agreed that the BS in Cyber Security should move on to intent to plan stage.
General Education – Harlan Onsrud
At the next UMaine System Gen Ed committee meeting the credit administrators from other campuses have been invited to discuss how they will certify block transfers between campuses. Relative to Block Transfers between UMaine System and Community Colleges, it will probably not be settled by the end of the year so instead the team is working on a Statement of Principles. In response to a question, Harlan stated that there is some urgency between both systems to get this done.
Ryan Low said that there were clear indications from the Governor on his goals on this subject.
Asked if there an estimate on what that could cost the campus, Ryan Low said he doesn’t know that.
Ad Hoc IT – Michael Scott
Participated in a meeting of Academic Affairs last week. Mick mentioned that Dick Thompson was also invited to the last elected members meeting, held in 137 Bennett. He presented information regarding the stolen laptop and general discussions. Mick mentioned that he hoped there would be movement on the lack of storage for information on computers.
Committees of the Administration Reports
Business Faculty met once more and are trying to make a very tight timeline work. Mick commented that the enrollment data for Business had some gaps making the MBA program numbers appear to drop dramatically. Jason said that was mentioned at the last meeting and that that information, and other information requested in January, has been asked for before recommendations can be made. As of early March the information wasn’t available.
Clayton Wheeler said he is on the Engineering committee and they met in Gorham during Spring break. There were gaps in the engineering data but that’s not part of the current conversation.
IV. Questions of the Administration
Q. Is it true that UMaine System is not allowing carryover on accounts?
A. Ryan Low said there was a memo sent out this week and yes; the System has created a policy on the matter. Ryan has had several meetings on campus to discuss the change, he’s asked departments to outline plans that carryover has historically been used for. He’s met with the System and had positive conversations on how to recognize the uniqueness of UMaine’s circumstances. The other campuses have no carryover.
Q. Some of our projects have money come in before June 30 but is used after that.
A. Those are the types of issues we’re working on and trying to figure the best way to move forward.
Q. Is this policy only applied to E&G funds?
A. Yes
Q. A couple hours ago the System announced the hiring of Elliot Cutler. Has there been anything announced regarding his hiring?
A. Provost Hecker said no. He was in a meeting today with the Chancellor, President, and Elliot Cutler. His appointment is through September 2016. His charge will be to build relationships with community about how a business center will work with law firms and businesses. The Harold Alfond Foundation is paying for his salary. All the funds for developing this are being made by private donation. They discussed the need to meet with the Business faculty as soon as possible; he offered to do that next week. There was a report from a consulting firm looking at consolidation and how this could be problematic for accreditation. Cutler said this is not a blueprint of where things are going. Bringing faculty from USM, UMaine, and the Law School together.
It was restated that UMaine be the place for MBA’s.
Q. Will an MBA still be offered here?
A. Looking at all areas to best serve students and not a plan to eliminate the UMaine MBA program.
Q. Will the USM Undergraduate Business School continue if the degree comes from UMaine?
A. Yes
Q. Is there an update on the Chancellor’s office being relocated?
A. Currently looking at space, operations will probably come here and possibly the Chancellor will end up here.
Q. What is the current use of fossil fuels at UMaine and are there plans to always use them?
A. Ryan Low said he doesn’t have the figures off the top of his head. The Sight Lines report brought it up. The charts show where fossil fuels goes, gas, etc.
Q. If APRIP is doing the coordinating work but the Presidents’ Council makes the decisions, what recommendations should we outline areas of APRIP?
A. Provost Hecker said it’s a challenge; advice would be to move forward since reports in May aren’t the end all. There will be some direction for the Presidents’ Council with an expectation of collaboration and how it will benefit students.
Q. I saw a report that UMaine Fort Kent is collaborating with Husson to do an MBA and share credits. We discuss collaboration and then this comes about?
A. Provost said he felt the same and he read it in the BDN.
Q. You met with the Chancellor today regarding Business, did this come up?
A.It didn’t come up.
Q. What is the cost of the new center and how is the Chancellor proposing funding?
A. A group is talking to businesses etc. Enrollment should cover costs plus. It’s viewed as new opportunities, not to transfer students from Orono down there.
Q. How many dual degrees?
A. Main focus isn’t a dual JD/MBA degree but for law students and business students to collaborate during their education.
Q. How does collaboration fit with the online MBA?
A. The way the Provost sees it, they will complement each other, UMaine needs to be sustainable and successful.
Q. So, Faculty has a responsibility for the academic side but we hear that the Administration is deciding academics for us. APRIP committees meet but the Presidents’ Council will make the decisions. What officially, as far as you know, can the administration dictate if they want? It sounds like you’re pushing for the academic side. What can we, as faculty and senate, do to help support?
A. Provost said the Administration does have a role but the Presidents’ Council doesn’t dictate the curriculum. They may get to a point where they say it’s not a good idea to have a program. Being involved with discussion is important.
Discussion: Some say, don’t get involved but others say to get involved. Faculty can have discussions with an open mind without endorsing a change.
Provost Hecker made a comment about the NEASC discussions not being totally accurate. The Chancellor hasn’t said that there needs to be one accreditation and that NEASC has said no. NEASC has followed what is going on with the UMaine System and raising questions whether they’ll accredit individual campuses because campuses have to have autonomy. The centralization raises issues of accreditation for individual campuses. What’s moving forward isn’t for one accreditation. An advisory group is putting together an opinion letter about whether it’s advisable to pursue. If so, what should the system consider? It needs to go to the BOT for approval.
That speaks to the PCRRC process, which is part of accreditation. The other campuses don’t seem to have a plan regarding the BS in Cyber Security. Provost Hecker said UMaine needs to move forward with their process.
Q. Mike Scott asked VP Low about the service agreement with ITS and who is responsible financially? Is money being removed from our campus funding? Currently it is not clear.
A. Depends on the specific area. There’s a baseline funding that comes off the top of appropriation for IT.
Mick commented that a meeting with Dick Thompson had a projector that wouldn’t sync, and because too much Wi-Fi was being used, it wouldn’t connect. The comment was that it’s up to the campus.
There are some things they’re covering and some the campus is covering.
Q. Will it be clarified so we know how it works?
A. Ryan said yes, still working on it though.
Q. What is the exact dollar amount this campus allocates to IT? Students pay part of IT through the unified fee. What’s the dollar value and what’s the plan?
A. Ryan said he could get those numbers.
V. Old Business
None
VI. New Business
April 1, 2015
Dr. Susan J. Hunter
President
University of Maine
Research, Scholarship and Creative Achievement at the University of Maine: Defining UMaine’s Mission
Dear President Hunter,
On the occasion of the 150th Anniversary of the University of Maine, we recognize the distinctive value of research, scholarship and creative achievement in the State’s only comprehensive research university. With its Carnegie ranking of Research-High, and its status as a top-100 public American Research University on a number of key measures, the State can take great pride in the University’s accomplishments and the competitive niche that it fills in the University of Maine System. As a Land Grant and Sea Grant institution, the University of Maine performs both basic and applied research that advances knowledge and fuels innovation. It fills critical research needs in the State of Maine through its Experiment Stations, Cooperative Extension outreach, and a broad mix of high-quality programs in the sciences, engineering, technology, arts and humanities. Through its quality faculty and cutting-edge research infrastructure, the University is constantly improving its ability to compete for federal grants and contracts and its capacity to serve business and industry. The University’s efforts are strongly focused on Maine’s priorities, conducting research in all of the State’s targeted technology sectors, emphasizing technology transfer and commercialization as indicated by the rapid growth of its patent portfolio and spin-off companies. The creativity and ingenuity of the University community fuels Maine’s Creative Economy, contributing to thriving communities, good jobs and a better quality of life for all. Graduate and undergraduate students play a central role in all of these efforts as they prepare to participate in building Maine’s future prosperity. The University of Maine is the Flagship campus of the University of Maine System and one of the State’s most valuable public assets; it must play a fundamental role in shaping Maine’s future and providing quality opportunities for all Maine citizens. In celebration of the University’s 150th Anniversary, we ask that the University of Maine adopt the following position statement. We also request that you send it to the Chancellor with the request that the University of Maine System adopt the statement and include it in the University of Maine System Policy Manual.
Sincerely Yours,
Members of the Faculty Senate Committee on Research and Scholarship
POSITION STATEMENT ON RESEARCH
As the State’s Land Grant and Sea Grant institution, and the State’s only comprehensive research university, the University of Maine is obligated to contribute research to the State, Nation, and World. To sustain this primary function, the University will actively encourage and support research, scholarship, and creative endeavors of its faculty, staff and students. The University of Maine is therefore committed to the following aims of research, scholarship, and creative achievement.
To fulfill the primary obligation of the University to create and advance new knowledge for the benefit of society.
To explore and develop new industries and creative enterprises, new applications of science, technology, engineering and mathematics, and new frontiers in all fields of knowledge.
To provide members of the faculty and students with the encouragement, resources and opportunities required to pursue inquiry and intellectual growth, and to foster an environment conducive to the creating, growing and validating new ideas.
To recognize that quality instruction at both the graduate and undergraduate level depends to a great extent on research, and that this relationship between instruction and research is a distinctive characteristic of the University.
To train undergraduate and graduate students in the methods and ethics of research, and to recognize that research is inseparably linked to graduate study.
To contribute to the solution of problems by rendering effective service to the State, Nation and World.
Amendments bolded: 1. To fulfill the primary obligation of the University to create and advance new knowledge for the benefit of society.
To provide members of the faculty and students with the encouragement, resources and opportunities required to pursue inquiry and intellectual growth, and to foster an environment conducive to the creating, growing and validating new ideas.
Vote: Approved
Research, Scholarship and Creative Achievement at the University of Maine: Defining UMaine’s Mission
Research and Scholarship Committee
April 1, 2015
Motion: The Faculty Senate of the University of Maine endorses the attached letter to President Hunter. This letter asks President Hunter to adopt an attached position statement on research at the University of Maine. The letter also requests that President Hunter send the position statement (with or without the Preamble) to the Chancellor with the request that the University of Maine System adopt the statement and include it in the University of Maine System Policy Manual.
A Resolution from the University of Maine Faculty Senate calling upon the Administration and Board of Trustees to Support Divestment from the Top 200 Publicly Traded Fossil Fuel Companies
WHEREAS overwhelming scientific evidence shows that the global climate is changing rapidly, due primarily to exponential growth in human combustion of fossil fuels and resultant emissions of greenhouse gases since industrialization (1); and
WHEREAS negative effects of climate change have already been felt in Maine and throughout the world, and likely will increase in severity into the near future (2); and
WHEREAS leaders, policy-makes, and scientists from 167 nations have agreed that we must curb emissions and limit planetary warming to no more than 2°C (3.6°F) above pre-industrial levels by 2050 if we wish to maintain a climate hospitable to complex human civilization and avoid ecological and economic catastrophe (3); and
WHEREAS limiting warming to 2°C by 2050 requires that we burn no more than 20% of proven fossil fuel reserves, necessitating that we keep 80% of the world’s reserves in the ground such that these unburnable reserves become “stranded assets” on industry balance sheets (4); and
WHEREAS the fossil fuel industry faces a “carbon bubble” due to stranded assets, declining net energy returns, recent and projected volatility in prices, overcapitalization, and excessive debt, continued investment in the fossil fuel industry carries great financial risk (5); and
WHEREAS the University of Maine proclaims itself to be “a shining star in the world of environmental and sustainability research, teaching and service” and has made significant contributions towards that goal, the scope and speed of climate change demand that we demonstrate intellectual and moral leadership by taking the further step of divestment and stop providing financial support to corporations whose short-term profitability relies on exploitation of low-income and minority communities, destroys natural ecosystems, and is simply incompatible with long-term socio-economic-ecological sustainability (6); and
WHEREAS “Divest UMaine”, a coalition of students at UM and throughout UMS and their allies, have been advocating strongly for divestment for two years, with the understanding that their future security, success, and well-being depend on society transitioning away from a fossil-fuel based economy and slowing climate change (7); and
WHEREAS the UM System Board of Trustees have already committed to divestment from the coal industry, UM- Presque Isle Foundation has committed to divestment from all fossil fuels, 43 faculty members of UM have signed an open letter urging the Faculty Senate to pass a resolution in favor of divestment, and many universities, cities, and other entities around the country and world either have divested or are pursuing divestment (8); and
WHEREAS in 1982, the University of Maine took the lead in the South Africa divestment movement by being the first public university in New England to divest, and 32 years later, it is time for the University of Maine to be at the forefront again and show true leadership and vision in setting a positive example for others to follow (9);
THEREFORE, BE IT RESOLVED that the University of Maine Faculty Senate, in support of Divest UMaine, calls upon the University of Maine Board of Trustees to stop any new investment in fossil fuel companies and to set a goal of full divestment within 5 years (10)
References and supporting information (researched by students, faculty, and alumni of Divest UMaine)
1. Hansen, J. et al. 2013. Assessing “Dangerous Climate Change”: Required Reduction of Carbon Emissions to Protect Young People, Future Generations and Nature. PLOS ONE, 8, e81468
Climate science predictions prove too conservative. Scientific American, G. Scherer. 12/6/2012
United Nations Framework Convention on Climate Change Accord signed by 167 Heads-of-State , Dec 7-, 2009, Copenhagen http://unfccc.int/resource/docs/2009/cop15/eng/11a01.pdfcd
2. Effects of anthropogenic climate change include increasing frequencies and intensities of extreme weather events such as heat waves, droughts, floods, as well as forest fires; changing circulation patterns in oceanic and atmospheric currents; ocean acidification; declining yield in agriculture, fisheries, and forests; desertification; biodiversity loss; sea level rise; outbreaks of pests and pathogens; social strife; and others. In many cases, historic projections have underestimated severity of realized effects.
Brysse, K., N. Oreskes, J. O’Reilly, and M. Oppenheimer. 2013. Climate change prediction: erring on the side of least drama? Global Environmental Change 23(1): 327-337
Hansen, J., M. Sato, and R. Ruedy. 2012. Perception of climate change. Proc. Nat. Acad. Sci.109: 14726 – 14727 E2415-E2423, doi:10.1073/pnas.1205276109
Jacobson, G. L., I. J. Fernandez, P. A. Mayewski, and C. V. Schmitt, editors. 2009. Maine’s Climate Future: An Initial Assessment. University of Maine, Orono, ME.
Fernandez, I. J., et al., editors. 2015. Maine’s Climate Future: 2015 Update. University of Maine, Orono, ME.
McKibben, B. 2011. Earth: Making a life on a tough new planet. St. Martin’s Griffin.
Rockström, J. and 28 co-authors. 2009: Planetary boundaries: Exploring the safe operating space for humanity. Ecol. Soc., 14, no. 2, 32.
In Maine, scientists see signs of climate change. Boston Globe, D. Abel. 9/20/2014
The humanitarian agency DARA projects that 100 million people will die if the world does not act to curb greenhouse gas emissions and slow climate change. http://www.reuters.com/article/2012/09/27/us-climate-inaction-idUSBRE88Q0ZJ20120927
3. http://unfccc.int/resource/docs/2009/cop15/eng/11a01.pdf
4. McGlade, C. and P. Ekins. 2015. The geographical distribution of fossil fuels unused when limiting global warming to 2°C. Nature 517 doi:10.1038/nature14016
Unburnable Carbon – Are the world’s financial markets carrying a carbon bubble? Carbon Tracker Initiative
5. Governments are talking more seriously about pricing and putting restrictions on carbon emissions, which would cause a drop in the value of fossil fuel stock, currently valued in part on the reserves still in the ground. This would result in a burst “carbon bubble” similar to the burst housing bubble of 2008, which led to a -18.8% return for MainePERS investments http://www.carbontracker.org/wp-content/uploads/2014/09/Unburnable-Carbon-Full-rev2-1.pdf
According to the Asset Owners Disclosure Project, almost all universities invited to participate in AODP’s Global Universities Index received either D ratings (meaning they are completely exposed to the risk of stranded assets and physical impacts of climate change) or had no publicly-available information with which to evaluate their risk. http://aodproject.net/news/69-universities-receive-fail-on-climate-change-risk.html
Fossil fuel companies continue to expend billions every year on searching for more reserves of ever harder to extract fossil fuels, which is a waste of investor money. http://www.theguardian.com/environment/earth-insight/2014/jun/10/inevitable-demise-fossil-fuel-empire
As fossil fuel companies respond to depletion of conventional deposits by shifting to “unconventional” reserves that are low-quality and carbon-intensive (tar sands, deepwater, hydrofracturing, etc.), continued investment is irrational and counterproductive because further drilling provides diminishing energy returns along with increasing ecological and economic costs. We should invest our remaining surplus energy wisely and productively to build a sustainable and resilient economy, instead of squandering that energy towards foolish pursuit of ever more fossil fuels.
http://r4d.dfid.gov.uk/Output/197127/
http://richardheinberg.com/museletter-263-the-gross-society
Hall, C. A. S., and K. A. Klitgaard. 2010. Energy and the Wealth of Nations: Understanding the Biophysical Economy. Springer, New York. http://www.esf.edu/efb/hall/
Investing in companies that are increasingly reliant on these unconventional reserves presents great financial risk given recent and projected volatility in oil prices and overall diminishing energy returns. As existing wells “play out” sooner than expected and new wells fail to produce, many overcapitalized and debt-laden companies cannot remain solvent at low oil prices and must either go bankrupt or sell drilling rights to recoup their initial capital investments (thus becoming “speculators” rather than oil-producers). As more investors realize the risks involved and are wary of buying existing drilling rights, energy junk bonds that finance many small companies that exploit unconventional reserves have collapsed, and financial return per unit debt accumulated by large established companies has begun to decline as well. For exploitation of unconventional fuels to be financially viable, oil prices must rise to at least $100 / barrel, and perhaps higher, but prices that high trigger economic recession and reduce demand for oil. As it becomes increasingly clear that much of what props up the fossil fuel industry and our economy as a whole is unsustainable debt, investing in fossil fuel companies and financing that debt becomes increasingly foolish and counterproductive, and is simply not an acceptable use of University funds.
http://www.postcarbon.org/publications/drillingdeeper/
Boyd, Roger. 2013. Energy and the Financial System – what every economist, financial analyst, and investor needs to know. Springer: London
Heinberg, R. C. 2011. The End of Growth: Adapting to our new Economic Reality. New Society Publishers, Gabriola Island, BC.
6. UM System fossil fuel investments support companies that: have shown they are unwilling to change their core business plans; spend billions each year searching for more fossil fuel reserves; engage in increasingly destructive and risky extraction processes as conventional oil is depleted; have reduced their already minimal commitment to alternative energy; contribute large sums of money to political campaigns for candidates that support their position; and have actively worked to discredit climate science and scientists
http://www.fossilfreemit.org/wp-content/uploads/2014/08/FossilFreeMIT-Lobbying-Disinformation.pdf
The fossil fuel industry pollutes communities along every point of production, from extraction to refinement to transport. Communities impacted by fossil fuel activity are disproportionately indigenous, low income and people of color communities. The impacts of climate change itself also disproportionately affect communities of color and nations of the global south— those that hold the least responsibility for (and have reaped the least benefits from) greenhouse gas emissions. As a public institution, we are obligated to be responsible social actors, which includes moving towards and investing in an economy that is not predicated on violence and exploitation.
Morello-Frosch et al. 2009. The Climate Gap: Inequalities in How Climate Change Hurts Americans and How to Close the Gap. UC Berkley Department of Natural Resources Publication.
Morse, R. 2008. Environmental Justice through the Eyes of Hurricane Katrina. Joint Center for Political and Economic Studies publication
The Blue Sky Project: Reaffirming Public Higher Education at Maine’s Flagship University
7. Students call on UMS to drop fossil fuel investments; trustees to start by weighing coal. Bangor Daily News, N. McCrea, 11/21/2014
Fossil fuel divestment a smart move for Maine universities — financially and ecologically. Bangor Daily News, M. LaSala and S. Perez, 3/13/2014
8. UMS partial divestment vote: On 1/26/2015, “the Board of Trustees approves directing University of Maine System equity and fixed income separate account Investment Managers to negative screen for coal and to divest of any current directly held investments in coal mining companies. This action applies to the University’s three portfolios – the Managed Investment Pool, Defined Benefit Pension Fund, and Operating Funds.”
UMPI Foundation divestment: http://www.umpi.edu/news/releases/item/umpi-foundation-board-completes-total-divestment-from-fossil-fuels
Many other colleges and universities have already divested from fossil fuels, such as Unity College, The College of the Atlantic, Sterling College, San Francisco State University, Hampshire College, and Glasgow University; Stanford University has divested from coal; some 250 other Universities have entered into formal processes to consider divestment; and Harvard passed a student resolution where 72% of students voted in favor of divestment. There are on-going divestment campaigns at Colby, Bates, Bowdoin, the University of New England, and Southern Maine Community College.
The Faculty Senates of Cornell, University of Vermont, Oregon State University, University of Tennessee, University of California at Santa Barbara, Rhode Island School of Design, and American University have passed solutions supporting divestment; 70 faculty members of Bowdoin College have written to their Board of Trustees urging divestment; and 245 members of Boston University have signed a petition supporting divestment. Faculty members on other campuses have set up committees to consider divestment (University of Wisconsin), signed letters of endorsement (Swarthmore, University of Washington, University of Michigan, Vassar), circulated petitions (Harvard), set up faculty divestment websites (Tufts), and created video statements in support (Middlebury College).
In Maine, the city of Waterville, the University of Maine at Presque Isle Foundation, Unity College, College of the Atlantic, the Island Institute, the Switzer Family Foundation, and the Maine Council of Churches, among others, have committed to fossil free investments. The Maine Community Foundation, which manages the funds of hundreds of nonprofit organizations in the state, now offers a fossil free investment opportunity. At least seven other states besides Maine, including Vermont and Massachusetts have pension fund campaigns. Twenty-two other US colleges and universities and over 30 cities in the US, including Seattle, San Francisco, Providence, Santa Fe, and Portland, OR, have already committed to divestment. In September of 2014, the Rockefeller Brothers Fund broke from its roots in the oil industry and declared they would divest.
http://www.bu.edu/today/2014/bu-faculty-petition-urges-divestment-from-fossil-fuel-companies/; http://www.dailycal.org/2014/09/08/faculty-association-urges-uc-divestment-fossil-fuels/; http://news.stanford.edu/news/2014/may/divest-coal-trustees-050714.html; http://www.harvardfacultydivest.com/open-letter-new; http://www.theguardian.com/environment/2014/oct/08/glasgow-becomes-first-university-in-europe-to-divest-from-fossil-fuels; http://bowdoinorient.com/article/9555; www.cornellalumnimagazine.com/pdfs/Divest_long_Res.pdf
http://www.nytimes.com/2014/09/22/us/heirs-to-an-oil-fortune-join-the-divestment-drive.html?_r=0
In all, over 180 institutions have committed to either full or partial divestment http://gofossilfree.org/commitments/
Furthermore, the United Nations Framework Convention on Climate Change is in support of fossil-fuel divestment, and UN Secretary-General Ban Ki-moon has called for a reduction in investments in support of a fossil-fuel based economy and encouraged a shift to investing in renewable enery http://www.theguardian.com/environment/2015/mar/15/climate-change-un-backs-divestment-campaign-paris-summit-fossil-fuels
9. According to Bishop Desmond Tutu, a strong supporter of divestment as a vehicle for social change, “We must stop climate change. And we can, if we use the tactics that worked in South Africa against the worst carbon emitters…We need an apartheid-style boycott to save the planet.” http://www.theguardian.com/commentisfree/2014/apr/10/divest-fossil-fuels-climate-change-keystone-xl
In 1982, UMaine was one of first 10 universities in the country to divest from Apartheid South Africa. At that time, between one-half and one-third of the S&P 500 did business in South Africa, placing these companies among the best investments. These were blue-chip stocks, steady earners that were key to the success of endowment funds. In contract, fossil fuel divestment is only looking at the energy sector, which is about 10% of the S&P, and the top 200 fossil fuel companies are even less. UMaine’s divestment from South Africa was a much bigger deal!
10. According to Divest UMaine, for purposes of fossil fuel divestment, “fossil fuel companies” shall be defined as any of the two hundred publicly-traded companies with the largest coal, oil, and gas reserves as measured by the gigatons of carbon dioxide that would be emitted if those reserves were extracted and burned, as listed in the Carbon Tracker Initiative’s report. http://carbontracker.live.kiln.it/Unburnable-Carbon-2-Web-Version.pdf
Divest UMaine is asking the UMS system endowment to halt any new direct or commingled investments in the top 200 publicly traded fossil fuel companies, and to divest from current direct and commingled holdings over the next 5 years. Fossil free investments have consistently kept pace with, or even outperformed, investments that include the top 200 fossil fuel companies. http://fossilfreeindexes.com/2015/01/20/thoughts-2014-performance-ffius/
Many institutions have found that investment in Energy Performance Savings Contracts provide equal or better returns on their investment dollars. http://www.ameresco.com/press/ameresco-awarded-contract-city-portland-maine-increase-energy-efficiency
Maine’s economy loses more than it gains from investments in the fossil fuel industry because our taxpayers are contributing millions of dollars each year in federal subsidies to coal, oil and gas companies. http://priceofoil.org/fossil-fuel-subsidies/
For years Maine has been suffering many of the hidden costs of the fossil fuel industry, which UMaine has been in the forefront of documenting, such as acid rain, increased respiratory illnesses due to being downwind of the coal industry, a large increase in tick borne diseases, a threat to Maine fisheries from ocean acidification and warming, and more severe weather and storm surges.
UMS may benefit through increased enrollment. Divestment is consistent with the Blue Sky strategic plan, which seeks to increase out-of-state student enrollment up to 25%-30% of total student population. http://umaine.edu/bluesky/pathway-strategies/pathway-2-money-and-management/#two-b
2014 research indicates that campus sustainability and environmental commitment factors significantly in high school students’ and their parents’ college search considerations.
http://www.princetonreview.com/college-hopes-worries.aspx
Additionally, UMS may benefit financially. According to President Stephen Mulkey of Unity College: “Our endowment is bigger than ever. The two primary concerns that boards have about endowment is, number one: divesting will cause them to lose profits that they otherwise would acquire. The financial industry’s own data show that that is absolutely unequivocally false. Socially-responsible investment, including those careful studies of fossil fuel divestment, show that by and large there’s no reason to expect your divested portfolio to do any worse than the market averages, assuming that you have active management of your portfolio. The second concern is that the trades necessary to reduce your exposure to something negligible would incur cost. In fact, that’s simply not reality because all you’re doing is adding another criteria to the investment manager’s decision tree. There’s absolutely no reason why that should cost you more money.
When we divested, no more than a few weeks afterward, we got a check from a donor that we’d never known before, for $30,000 simply for having divested. Virtually none of our alumni have suggested that we’ve made a mistake in any way shape or form. The vast majority of people have been overwhelmingly supportive. They’ve been especially supportive not just of divestment, but the framing of our curriculum under sustainability science, which is really what I want the college to be known for.”
APPENDIX 1
An Open Letter to the Faculty Senate
From: Faculty Members of the University of Maine
Re: Divestment from fossil fuel company holdings
Date: April 10, 2014
In support of the University of Maine Green Team and students throughout the University of Maine System, we are urging the University of Maine Faculty Senate to endorse the students’ divestment proposal. The proposal calls on the University of Maine System to divest the University endowment portfolio of fossil fuel company holdings over a period of five years.
The University of Maine is not alone. There are similar divestment campaigns at over 400 campuses nationwide. Nine colleges and universities have already divested, including Unity College, College of the Atlantic, and San Francisco State University. Faculty senates have voted for divestment at such institutions as Cornell, UCSB, Oregon State, and UVM. In 1982, the University of Maine took the lead in the South Africa divestment movement by being the first public university in New England to divest. Today, 32 years later, it is time for UMaine to be at the forefront again.
Our focus is on the 200 corporations holding the world’s largest fossil fuel reserves. Leading climate scientists have stated that 60 to 80 percent of the planet’s fossil fuel reserves must never be burned if we are to stay below a 2-degree Celsius rise in average global temperature. This 2-degree limit has been identified by scientific groups as the threshold beyond which the effects of global warming are likely to be catastrophic. These groups include the Intergovernmental Panel on Climate Change, the National Academy of Science, and the Royal Society.
Furthermore, we must acknowledge the biophysical reality that we have entered the “second half of the age of oil” in which we no longer can rely on increasing our consumption of fossil fuels to generate wealth. US oil production peaked in 1970 and global oil production peaked in 2008, and in 2014 we appear to be on an “undulating plateau” preceding inevitable decline. Energy return on investment (EROI) of oil has declined over the last century from ~1000:1 to ~10:1, indicating that we are gaining less and less net energy from investing in oil extraction and production as large, easily-accessible, high-quality reserves are depleted and we’re relegated to exploiting smaller, harder-to-reach, lower-quality reserves. Once the economic, energetic, and environmental costs of obtaining oil and other fossil fuels outweigh the benefits of burning those fuels, further investment in that industry is foolish. Currently, the biophysical reality of depletion is winning against the promise of technological progress gained via new investment, and we should be very skeptical of calls to continue subsidizing fossil fuel companies in the hopes that business-as-usual will continue to yield profits.
Individuals can make efforts to reduce their carbon footprints, but an adequate response to climate change requires both effective government policy and visible actions by both public and private institutions. As educators, we contribute to public awareness through our teaching and research, but such efforts are insufficient to affect a government that has been in deadlock.
The goals of divestment are to 1) publicly call attention to the necessity for the United States and other countries to make a transition away from fossil fuels towards energy sources that are carbon neutral, and 2) stop subsidizing fossil fuel extraction whereby we send University resources obtained from student tuition and taxpayer appropriations to fossil fuel companies. The University of Maine has already made major efforts to reduce greenhouse gas emissions and make the campus more energy efficient, but the scope and speed of climate change demand that we take further steps by weaning ourselves from fossil fuel investments and no longer providing financial support to corporations whose short-term profitability is incompatible with long-term sustainability.
The financial implications of divestment have been carefully considered. Investment specialists are finding that it is possible to divest without reducing the value of an institution’s endowment. In the long run, it may also be financially prudent to divest. When the proven fossil fuel reserves of the major companies are found to be “stranded assets,” or when government policies impose substantial new constraints on fossil fuel emissions, the value of stock in such companies is likely to fall. Portfolios without fossil fuel investments already perform well, and sometimes outperform those that include fossil fuels.
It will be up to the Board of Trustees to decide whether to divest. However, a vote from the Faculty Senate will help to ensure that the Board of Trustees gives the issue serious consideration and the attention it deserves. We invite those who agree with us to add your voice to this discussion.
Respectfully,
Constant Albertson, Associate Professor of Art, Dept of Art
Douglas Allen, Professor, Department of Philosophy
Steven Barkan, Professor, Department of Sociology
Carla Billitteri, Associate Professor, Department of English
Jim Bishop, Retired Lecturer, Department of English
Richard Brucher, Associate Professor and Chair, Department of English
Pat Burnes, Associate Professor, Department of English
Sandra S. Butler, Professor, School of Social Work
Stephen Coghlan, Associate Professor, Department of Wildlife Ecology
Laura Cowan, Associate Professor, Department of English
Ronald Davis, Professor Emeritus, School of Biology & Ecology, and Climate Change Institute
Shirley “Lee” Davis, Professor Emerita, Division of Lifelong Learning
Julie DellaMattera, Associate Professor, Early Childhood Development & Education
Kerstin Engman, Assistant Professor, Department of Art
Jacquelyn Gill, Assistant Professor, School of Biology & Ecology and the Climate Change Institute
Nathan Godfried, Professor, Department of History
Michael Grillo, Chair, Department of Art
Mark Haggerty, Associate Professor, Honors College
Laurie E. Hicks, Professor, Department of Art
Michael Howard, Professor, Department of Philosophy
Jon Ippolito, Professor, New Media Department
Nico Jenkins, Preceptor, Honors College
Richard W. Judd, Professor, Department of History
Margaret Killinger, Rezendes Preceptor for the Arts, Associate Professor, Honors College
Roger King, Associate Professor, Department of Philosophy
Sharon Klein, Assistant Professor, School of Economics
Kyriacos Markides, Professor, Department of Sociology
Elizabeth McKillen, Professor, Department of History
Robert M. Milardo, Professor of Family Relations, Human Development
Virginia Nees-Hatlen, Professor Emerita, Department of English
Elizabeth Payne, Lecturer II, Department of English
Darren Ranco, Chair of Native American Programs, Associate Professor of Anthropology
Alan M. Rosenwasser, Professor of Psychology
Ann Schonberger, Professor Emerita, Women’s, Gender, and Sexuality Studies Program
Phillip Silver, Professor of Music, School of Performing Arts
Nathan Stormer, Mark & Marcia Bailey Distinguished Professor of Speech & Theatre,
Department of Communication & Journalism
Sharon Tisher, Lecturer, School of Economics and Honors College
Mary Tyler, Professor of Zoology, School of Biology and Ecology
Tim Waring, Assistant Professor, School of Economics
Gregory White, Professor, School of Economics
Faren Wolter, Instructor, Department of Wildlife Ecology
Additional signers after submission to Faculty Senate:
Jean D MacRae, Associate Professor, Civil and environmental Engineering
Naomi Jacobs, Professor, Department of English
Non-faculty Endorsements:
Laurie Cartier, Administrative Specialist CL2, Department of Sociology
Appendix:
The Royal Society and the US National Academy of Sciences, “Climate Change: Evidence and Causes,” February 27, 2014.
http://dels.nas.edu/resources/static-assets/exec-office-other/climate-change-QA.pdf
Letter: Faculty-led divestment from fossil fuels, Cornell Daily Sun, December 24, 2013.
http://cornellsun.com/blog/2013/12/04/letter-faculty-led-divestment-from-fossil-fuels/
The Aperio Group consulting firm showed that since 1997, a “carbon free” stock index fund that excludes shares of fossil- fuel companies would have had a higher annual rate of return, 6.08 percent, than the widely used Morgan Stanley Capital International index, which rose 5.43 percent a year.
Hall, C.A.S. and K. Klitgaard. 2010. Energy and the wealth of nations: understanding the biophysical economy. Springer publishing
Letter from Harvard Faculty: http://www.harvardfacultydivest.com
APPENDIX 2
Primer on Divestment
What is Divestment?
Divestment is the opposite of an investment—it simply means getting rid of stocks, bonds or investment funds that are unethical or morally ambiguous. Fossil Fuel investments are a risk for investors and the planet—that’s why we’re calling on institutions to divest from these companies.
Companies like ExxonMobil, Shell and Peabody Coal have billions of dollars. How can divesting the funds from a few institutions like universities, pensions and churches make an impact?
Colleges and Universities hold over $400 billion in their endowments. That’s a huge number—and getting all of that money out of coal, oil and gas will make a pretty big splash. Add in the big state pension funds, and church, synagogue and mosque investments, and we’re well on our way to making ExxonMobil, Shell and Peabody sweat.
Divestment is also a really important way to shake up the financial markets, and show the big finance firms on Wall Street that fossil fuels are risky investments. The more we can reveal just how irresponsible these companies are—and how irresponsible it is to invest in them—the better.
We want College and University Presidents and Boards (as well as Religious and Pension funds) to immediately freeze any new investment in fossil fuel companies, and divest from direct ownership and any commingled funds that include fossil fuel public equities and corporate bonds within 5 years.
200 publicly-traded and government owned companies hold the vast majority of the world’s proven coal, oil and gas reserves.2 Those are the companies we’re asking our institutions to divest from. Our demands to these companies are simple, because they reflect the stark truth of climate science:
- They need immediately to stop exploring for new hydrocarbons.
- They need to stop lobbying in Washington and state capitols across the country to preserve their special breaks.
- Most importantly, they need to pledge to keep 80% of their current reserves underground forever.
A brief synopsis of the UMaine System Endowment and How It’s Invested
According to The University of Maine System Annual Financial Report Year Ended June 30, 2012 (hereafter Annual Report): Endowments are gifts received from donors where the original amount of the gift (corpus) cannot be expended while the income earned and related appreciation can be expended. If the donor established criteria to determine how the expendable amounts can be used, then such amounts are considered restricted expendable. If the use of funds is left to the discretion of the University of Maine System (hereafter the System), the endowment income and appreciation is considered unrestricted. The System uses a pooled investment approach for its endowment unless otherwise required by the donor. Affiliates investing in the pool include: the University of Maine at Fort Kent Foundation, the University of Southern Maine Foundation (equals approximately 7% of the managed investment pool), and the John L. Martin Scholarship Fund, Inc. Two outside entities, the UMS Other Post Employment Benefit (OPEB) Trust and The Maine Maritime Academy pool monies with the System’s endowment but, they are subject to the System’s choice of investment direction. Except for certain gifts invested separately at the request of the donors, the System’s endowment is managed as a pooled investment fund; investment policies and strategies for the combined pool are determined by numerous external independent investment managers, which are chosen and hired by the System. These money managers, much like any entity on the free-market, have a specific style, approach, and ethic to their investment strategy. Therefore, the System hires these managers based upon their traits as well as their performance and history. The hiring processes is lengthy and labor intensive and consequently prohibitive to change. Once the System selects and hires these managers it distributes the endowment funds across the entire body of managers in a diversified approach. Henceforth, the System relinquishes its legal rights to the management of its portfolio and completely relies upon these manager’s strategies to maximize financial return. Therefore, the Board of Trustees has no legal way surgically divesting its holdings from individual managers but rather they would have to fire those individual managers, liquidate the holdings, and then hire new socially responsible managers (there exists various Social and Responsible Investment firms, for more info visit: http://ussif.org/resources/sriguide/srifacts.cfm). Ultimately, the pool is invested strategically and the System buys into the strategy lock, stock, and barrel. Moreover, it is difficult for the Board to even audit their investments in order to pin-point specific equities (stocks or any other security representing an ownership interest) as theoretically such auditing would jeopardize individual managers strategies by exposing their specific mix of investment choices.
As of 2012, oversight and management of the System’s investments was under the charge of the Board of Trustees Investment Committee (as of 2012 this committee included: Eleanor M. Baker, Chair; Kurt W. Adams; Samuel W. Collins; Gregory G. Johnson; M. Michelle Hood; Marjorie M. Medd; Karl W. Turner; and Non-Trustee/Non-Voting Members: James Mullen, Chris Robinson, and Jack Moore). The board employs an Investment Consultant, which as of 2011, was New England Pension Consultants (NEPC), located in Cambridge, MA. Then there are two individual positions on the board that concern finance: Vice Chancellor for Finance and Administration and Treasurer and Director of Finance and Controller; these positions are currently held by Rebecca Wyke and Tracy Elliot respectively.
The System’s pooled endowment investments (including affiliates) had a market value of $121 million as of June 30, 2012; pages 36, 37, 38, and 39 of the Annual Report (Financial Statements) includes itemized investments but, only by general title/classification, not by specific equity names. With that said, as of September 30th 2012, according the Tracy Elliot, the System’s managed investment pool (including the endowment) had an exposure of 6.2% to oil companies specifically, which would equal approximately $7.5 million.
Information from the Financial Director and Controller of UMaine System
- The System only holds 2 separate accounts which are in the MIP. These accounts are TCW and Met West. Holding a separate account means that the System actually holds the individual securities. These are the only two accounts, where we can ask the managers to not hold fossil fuels. All other investments are held in a mutual fund or commingled fund vehicle. In these cases, the System does not own the individual securities but owns a share of the fund. In addition, we do not have the capability to ask these managers to divest in fossil fuels.
- Some managers (i.e. hedge funds, Permal and Gottex) will not distribute the underlying holdings outside of NEPC and the Investment Committee. In these cases, the managers have given us the % exposure to fossil fuels. There are emails in the zip files from these managers.
- It is important to note the reason why we don’t own separate accounts with the managers. Separate accounts require large minimum investments and the System does not have the scale to invest solely in separate accounts in most cases. Therefore the reasoning for mutual funds and commingled funds. In addition, separate accounts are not always given as an option for investing with managers (i.e. Hedge Funds typically only have commingled fund type vehicles.)
Socially Responsible Investment:
Sustainable and responsible investing (SRI) spans a wide and growing range of products and investments, from stocks and bonds, to savings, checking and other banking accounts, to venture capital. Like all investors, sustainable and responsible investors seek a competitive financial return on their investments, and the good news is that it is possible to consistently achieve this.
A growing number of academic studies have demonstrated that SRI mutual funds perform competitively with non-SRI funds over time. Several of these peer-reviewed and published studies have been awarded the prestigious Moskowitz Prize. Additionally, more than 20 studies demonstrating that SRI mutual fund performance is comparable to that of non-SRI funds can be found at www.fsinsight.org — a compendium of all the major academic studies on SRI.
Another indication of the competitive performance of SRI funds is the performance of SRI indexes. These indexes are designed to be benchmarked to non-SRI indexes, such as the S&P 500. The longest-running SRI index, the FTSE KLD 400, was started in 1990. Since that time, it has continued to perform competitively — the FTSE KLD 400 with returns of 9.51 percent from inception through December 31, 2009, compared with 8.66 percent for the S&P 500 over the same period. For up-to-date information on the performance of SRI funds offered by member firms of US SIF, visit our Mutual Fund Performance Chart.
Ethical Funds do not underperform: In their study International Evidence on Ethical Mutual Fund Performance and Investment Style the Dutch ABP Investments and Maastricht University reviewed more than 100 German, UK and US ethical mutual funds. After controlling for investment style, the authors found little evidence of significant differences in risk-adjusted returns between ethical and conventional funds for the 1990-2001 period. With respect to investment styles, they concluded that all ethical investment funds are more growth–oriented than value-oriented, if compared to conventional funds. Finally, the authors present convincing evidence for the conclusion that ethical funds do not underperform, compared to conventional funds.
The ‘SEE’ Effect: Another report called Sustainability Pays, was conducted by CIS (Co-operative Insurance Society), Forum for the Future and Pirc in the UK. To investigate the case for socially responsible investing (SRI), the authors set out to answer two questions. Firstly, does screening companies with the use of Social, Ethical and Environmental (SEE) criteria help investors to perform better than the broader market? Secondly, does improved corporate social responsibility (CSR) – the aim of SRI strategies – help companies to perform better than their competitors (and thus produce higher returns for their investors)? The evidence shows that there is a potential ‘SEE’ effect that appears to offset the cost of lower diversification in a screened SRI portfolio. While this may not prove the case for higher returns with SRI, it certainly seems to show that CSR screened investments do not imply lower returns. New approaches with a forward-looking view of the impact of stakeholders and environmental issues on companies’ future cash flows (and therefore value) show that it is possible for these portfolios to perform even better.
Excluding companies entirely remains difficult for many large institutional investors. How about engaging with companies? Basic economic theory claims that this kind of initiative cannot help companies to increase their shareholder value. Other views suggest that CSR brings a first-mover advantage, CSR is an indicator of good management, CSR can create a competitive advantage based on reputation, and CSR can create value by delivering process innovation. Though it is difficult to untangle cause and effect, it appears that the cost of investing in CSR will be offset by the financial advantages of CSR. There is growing evidence that, in certain companies, and at certain times, improving CSR will lead to better financial performance. The study concludes: ‘The question then is not does being green and socially responsible pay, but when does it pay?’
Some Links
www.350.org
USM Divest FB: http://www.facebook.com/usm.divest
USM Twitter: https://twitter.com/DivestUSM
UMaine System Divest FB: https://www.facebook.com/DivestForME
Link to the U Maine System petition: http://act.gofossilfree.org/act/maine
Socially Responsible Investing: http://ussif.org/resources/sriguide/srifacts.cfm
International Investors Group On Climate Change: http://www.iigcc.org/home
Green Money Journal: http://www.greenmoneyjournal.com/
Discussion: Stephen Coghlan spoke in favor of the Resolution saying there’s a huge issue with climate change due to fossil fuels. Divestment is a response to the issue. Cat Fletcher, a geology student & Connor Scott, of Divest UMaine also spoke in favor of the Resolution. Ms. Fletcher stated she’s worked on the campaign, been to divestment conferences and met with investment managers. She wants what is best for UMaine and to keep the issue in mind, many others have divested, when looking at the larger picture. Connor Scott stated that this isn’t a pop culture issue, it’s a trend that isn’t going anywhere. Divesting now would remove those investments from portfolios before they have little value. Jonathan Rubin spoke against the Resolution saying that he hoped everyone would listen to him with an open mind. He said some didn’t want to discuss this because it didn’t appear to be a senate issue. He hoped that the next time an issue like this came up there would be more campus discussions prior to bringing it to the floor. Having worked his entire career studying this issue, it is important but it’s not a vote of conscience. It doesn’t ask the UMaine community to reduce their use of fossil fuels, driving, heating homes, flying, etc.
Harlan said he thinks along the same lines as Jonathan and wrote a motion in the time he’d sat there. He said having a reduction in fuel usage would be a direct impact. Someone mentioned that renewables are more costly, are students willing to have their fees increased in order to use renewables. Mick stated that he didn’t want to open up comments too much but that this needs a campus dialog.
Proposal to have senators discuss this issue at the next elected members meeting and then brought back up at the Full Senate later in April.
Vote to table: Approved (yea 16, nay 10, abstain 4)
Adjourned at 4:48 pm
Respectfully submitted,
Kathryn Slott
Prepared by Kim Junkins