Oxbridge must end dirty investments – both offshore and oil
Students at Oxford and Cambridge are taught about the dangers of economic inequality, climate change, and the limits of burnable carbon. But the Paradise Papers have revealed that behind the scenes, the universities are investing tens of millions in projects that systematically exacerbate inequality and climate disaster.
The scandal is not simply tax avoidance. It is the hypocrisy of universities that espouse their commitment to sustainability while financing environmental destruction offshore.
A 2016 Cambridge report insisted that the university’s investments would reflect its underlying values, which include a commitment to environmental protection. Oxford’s vice-chancellor Louise Richardson declared in 2015 that the university must “recognise the need to work towards net-zero emissions in … all of the university’s activities, including the stewardship of our investment funds.”
The Paradise Papers disclose a complex chain of investments that begins at Oxford and Cambridge, whose combined endowments exceed £11bn, and ends with the financing of Royal Dutch Shell initiatives to explore deeper into the ocean and identify more carbon to burn. These investments are not compatible with a carbon-neutral
endowment, a stable climate, or a just future.
Cambridge has defended its approach, pointing out that the charitable status of the universities means they do not normally have to pay tax on investments, while Oxford pointed out that offshore investments were commonly used and said it had “very low exposure to the broader energy sector”.
The universities are, in fact, not totally exempt from taxes. Even charities must pay a special US tax on investments in hedge funds, but the Paradise Papers expose that Oxford and Cambridge use blocker corporations. Blocker corporations act as middlemen, converting the hedge fund income into dividends, which US law doesn’t tax. The schemes are legal, but the practice reveals two universities exploiting loopholes in pursuit of maximum return, generating profit at the expense of human communities near and far.
It comes as no surprise that our universities are financing dirty oil. But the sheer scale of the investments and the disingenuous approach is breathtaking. It demonstrates a lack of transparency and a failure to take responsibility. What else are they hiding?
Fossil fuel divestment is not just a prudent financial decision, it is a moral imperative. As we hurtle towards a dangerously warming world, it is essential that we stigmatise the industry most responsible for the climate crisis.
Divestment has worked before – consider the cases of apartheid South Africa, or the tobacco industry. And it is working now, with a third of British universities already committed to fossil fuel divestment in some form.
At Oxford and Cambridge alike, students have banded together in opposition to this immoral system, launching coordinated actions on both campuses under the banner of Oxbridge #ComeClean. Last Friday, Oxford students protested at the headquarters of the endowment management company; on Tuesday hundreds of students will march through the streets of Cambridge calling for justice and transparency.
Our coalition has four demands: full disclosure of where the universities are investing their endowments; a complete withdrawal from all offshore funds and a public apology for such investment practices; full divestment from both direct and indirect investment in fossil fuels; and comprehensive student and faculty-led ethical investment policies.
Both Cambridge and Oxford pride themselves on their contributions to society. Cambridge’s core values include “a concern for sustainability”, while Oxford seeks to “benefit society on a national and a global scale”. Our message is simple: they must start practising what they preach. Sustainability is not just a buzzword; it should be integral to everything the universities do. Greater profit margins are no excuse for dodging tax and profiting from climate breakdown. If they call themselves charities, they should start acting that way.
The authors are students Oxford and Cambridge
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