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Climate Impact Task Force holds first dialogues

The Fossil Fuels and Climate Impact Task Force, a committee that was formed in response to student activism around divestment last year, organized a series of events that took place this week in JRC 101. One of the dialogues facilitated by the task force, titled “Managing Grinnell’s Endowment, Trustee Stewardship and Investment Decisions,” represented the first of what will be three separate weeks discussing Grinnell’s investments in fossil fuels and more broadly, its impact on the climate. The primary purpose of this week’s events was to provide context regarding the school’s endowment and budget for further discussion of the College’s current fossil fuel investments. This week’s events represented the first ever open discussion of Grinnell’s endowment.

The first day kicked off with an introduction to the roles of trustee members and task force members regarding the endowment and a number of open discussions with representative advisory and task force members over coffee. A more formal event elaborated on the process by which Grinnell College makes its investments, followed by a similar event which addressed the role of the College’s endowment in relation to its operating budget.

Lucy Nelson ’20, a student member of the advisory committee as well as the current leader of the Divest campaign, summed up students’ expectations of the Fossil Fuels and Climate Impact Task Force dialogues. “The reaction from students has been a collective, ‘finally,’ so I think people are definitely hopeful that the trustees are listening,” Nelson said.

Nelson described her experience during a meal with the task force and advisory committee members as a “beginning to forge relationships between the advisory committee and the task force itself because we have not had a lot of direct communication yet, but we are going to be working closely in the future.”

Nelson hoped this week’s events would provide some clarity to the issue of divestment.

“We’ve been told divestment would affect our endowment,” Nelson said, “which would in turn affect student financial aid, which has been stressed a lot by the administration … and I think it’s important that we get to the bottom of exactly how that is true.”

Nelson mentioned this would be “a step in the right direction,” representing the first time the College would be transparent about the actual amount of money in its endowment invested in fossil fuels.

“About Grinnell’s Endowment” was led by Interim Chief Investment Officer Andrew Choquette and Associate Director of Investments Angela Clement, in which they discussed the logistics of Grinnell College’s 1.87 billion dollar endowment. In their presentation, Choquette and Clement expressed concern about the College’s heavy reliance on the endowment, and emphasized the opinion that potential changes on investments should be approached cautiously. They referred frequently to the College’s reluctance to raise the payout on the endowment, citing concern about the future operations of the College.

“The success of the endowment is highly correlated to the success of the school being able to operate and continue to operate for future generations,” Choquette said.

Choquette and Clement explained how the Grinnell College investment team rigorously selects external investment managers based on their process of investing, and emphasized the team’s preference for managers that “share values with the College.” Specifics on College investments, and even the names of external investment managers, however, are often protected by non-disclosure agreements signed by the College at the point of partnership.

In the meeting, Choquette and Clement discussed how, as of the June 30, 2017 portfolio, Grinnell College had 45 million dollars invested in fossil fuels, representing 2.4 percent of the endowment.

“It’s just easier to think about the broader issue of climate impact when you have a similar set of facts for everybody to work from,” Choquette said.

Chief Financial Officer and Treasurer of the College Kate Walker led the event titled “Role of the Endowment in Budget.” Walker mentioned that the previous event explained how the College builds its endowment, while hers would explain how the College spends — and saves — its endowment. Walker said that a one to three percent change in endowment return would “have a trickle-down effect on the way we operate the institution.”

“Every value decision you make, you want to make it in the most informed way,” Walker said at the event. “That’s what we’re trying to do is make sure that everyone’s got the information necessary to make a smart decision that’s also consistent with their values.”

The next Fossil Fuels and Climate Impact Task Force dialogue will take place Oct. 3 to 4, and will explore “Arguments in support of and in opposition to fossil fuel divestment.”

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