In response to the student divestment proposal submitted in February of 2021 and the Social Responsibility Committee (SRC) report in April of 2021, the Board of Trustees of Macalester College[1] today announced its decision to 1) divest of all dedicated, publicly traded oil and gas assets, including all shares of Enbridge, Inc., and 2) adopt a college investment policy that prohibits new investments that are solely invested in oil and gas assets.

The process was conducted in accordance with the college’s Guidelines for Investor Responsibility.

Specifically, the divestment proposal asked the following:

  1. Divest from all liquid holdings in Enbridge Energy. …[D]ivest the school’s current equity and other liquid holdings in Enbridge Energy.  As you instruct third-party asset managers to undertake this process, be clear with them that Macalester is divesting from Enbridge in protest of the Line 3 tar sands pipeline project.
  2. Denounce Line 3.  Demonstrate institutional support for climate justice and the members of the Macalester community dedicated to the Line 3 resistance movement by issuing a public statement condemning Enbridge’s Line 3 tar sands pipeline replacement project.
  3. Foster transparent dialogue with the Mac community about the school’s investments.  Open up honest and participatory dialogue with students, faculty, staff, and alumni by being more transparent about the management of the endowment, its function in the school’s operations, the types of investments we hold, and the industries we are invested in, however harmful.

Upon receipt of the SRC report, the Board of Trustees appointed an Ad Hoc Committee of its members to review the proposal and formulate a recommendation to the full Board.

Following a review of feedback from the Ad Hoc Committee, members of the SRC, members of the campus community, the college’s finance leaders, and the President, the Board took the following actions at a meeting held on August 17, 2021:

  1. Instructs the Investment Committee to divest of all dedicated, publicly traded oil and gas assets, including all shares of Enbridge, Inc.
  2. Adopts a college investment policy that (i) prohibits new investments to be directly held by the college in any company or fund (public or private) that invests solely in oil and gas assets, including infrastructure and field services, and (ii) directs the Investment Committee and the Investment Office to reduce the college’s existing investments in those assets where economically or otherwise practicable.

Guiding the Board’s decision were the October 2019 actions, which placed a moratorium on new investments in private oil and gas partnerships. While the assets from which it is divesting are public and date back to 2013, the Board sought to remain consistent with the spirit of its prior decision, and views its decision to divest the entire portfolio as in line with those earlier actions. These assets are targeted to be sold by calendar year-end 2021 but could be extended based on market conditions.

The Board believes it is important for the community to know that there will be underlying investments held by fund managers that are in oil and gas companies, as many of our fund managers hold portfolios that are broadly representative of the stock market, which would be inclusive of oil and gas. This resolution does not provide direction to divest of all oil and gas assets. For example, a diversified mutual fund that holds interests in oil and gas companies as part of its portfolio would not be subject to this policy, since it is not possible to separate out particular investments in such funds.

The Board declined to issue a formal statement denouncing Enbridge or the Line 3 project.

Finally, the Board supports the goal of providing the community with a clearer understanding of many aspects of the business of the college, the Board and its governance. The Board of Trustees has charged its Governance Committee with identifying opportunities for greater transparency between the Board and the campus community as part of its work reviewing our overall governance practices.

[1] Trustee Honorable Michael J. Davis was recused from this issue and took no part in the decision.

August 23 2021

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