Just as they did with university endowment funds, divestment activists are now pressuring university pension plans to abandon investment in oil and gas companies.
That’s why InvestNow has called on 20,000 university professors to reject the divestment agenda.
In Ontario, Shift Action is pressuring the University Pension Plan – which represents the University of Toronto, Queen’s University, the University of Guelph and Trent University – to “remove oil and gas companies from its portfolio,” citing growing financial risk.
This is a classic example of biting the hand that feeds you. Publicly funded universities are being asked to no longer invest in oil and gas, yet they continue to benefit from the sector. Universities and their pension plans are tax-funded to the tune of billions of public tax dollars. A big portion of those tax dollars comes from the oil and gas sector and its workers.
Do professors understand the consequences of divestment? Divestment advocates say their efforts strike a blow against climate change, but the world needs oil and gas every day. In 2050, oil and gas are expected to still supply 47 per cent of world energy needs, compared to 52 per cent today, according to the International Energy Agency.
Canada’s oil and natural gas industry operates under some of the most stringent environmental regulations in the world. If people don’t use ours, their needs will be met by other countries with lower standards. So, divestment hurts the environment, and it also hurts Canada.
The oil and gas sector is our biggest exporting industry, is a top-three contributor to Canada’s GDP, supports 600,000 jobs across the country, and contributes billions annually to government coffers in taxes and royalties – including the salaries of university professors and staff.
Divesting from Canadian oil and gas does not reduce global emissions, does not reduce demand and does not foster innovation. Divesting from oil and gas threatens to constrain supply and lead to shortages and higher prices. Divesting from oil and gas costs jobs.
Divestment hurts at all levels.
For the professor, their pensions are at risk. Oil and gas companies have had some of the strongest returns on the Toronto Stock Exchange (TSX). To eliminate these companies from the investment pool solely for ideological reasons is folly and goes against the duty to maximize returns.
For everyday Canadians, their livelihoods are at risk.
For Canada, the economy is at risk.
The end goal of divestment is the end of Canadian energy. With that comes a hobbled economy, supply shortages, higher prices, shuttered factories, job losses, and energy poverty.
It’s time to invest in Canadian oil and gas for the good of the economy, the environment, pension plan members, and everyday Canadians.
Gina Pappano is executive director of InvestNow Inc., a nonprofit dedicated to demonstrating that investing in Canada’s resource sectors helps Canada and the world. This commentary originally ran on Canadian Energy Centre.