As part of our Aberdeen 2040 strategy the University has made a clear commitment to show leadership in working for the sustainable future of our planet by, for example, committing to net zero carbon emissions before 2040.  In addition, the University is committed to generating resources for investment in education and research year on year through a responsible and sustainable investment policy, whereby investments achieve the best return possible. 

Our community has worked in partnership as part of this shared aim, including constructive discussions with the University of Aberdeen Fossil Free Campaign, AUSA and the wider student community about various related issues including financial divestment from fossil fuels.

As a result, the University is committed to using our unique position and influence to encourage and support the transition to the low carbon economy.  By 2025 we aim to have completed a process of ensuring that any investment in the energy sector actively reflects our own aspiration to support energy transition, through our research, teaching and other institutional activities.

For decades, the University has worked in partnership with the energy industry for the benefit of our region, the University and our students.  It has provided financial support for our world leading research, and through philanthropic support it has created scholarships to enable student access to our education. Further, it has funded initiatives which support the wellbeing of our student community, including the provision of valuable work placements.  We will continue to work with the energy sector in this way, as part of a just transition to a greener, more sustainable future. We continue to value our industrial partnerships, and the benefits they bring to our students and research activities.

As we commit to divest from fossil fuels, we remain committed to working with and supporting the energy industry through our education and research, helping to meet wider industry and societal ambitions around Net Zero via a range of initiatives including our Centre for Energy Transition.

FAQs

1. What is fossil fuel divestment?

Fossil fuel divestment is when an organisation or investment fund sells any direct financial investments it has in companies that extract fossil fuels such as coal, gas, oil, and tar sands. These may be directly owned shares, or investments in pooled and tracker funds.

2. Why are you doing this?

Through Aberdeen 2040, the University made a clear commitment to show leadership in working for the sustainable future of our planet, evaluating all our actions for their impact on the environment.  The decision to divest from fossil fuels relates directly to that commitment.  It is a decision we have taken with and for our community and is consistent with our commitment to achieve Net Zero before 2040.  It acknowledges the student voice, recognising the impact climate change has on future generations.  The impact of society’s continuing reliance on fossil fuels has a significant impact on global climate change and the transition to more sustainable sources of energy is now crucial. The University’s position in working closely with the energy sector based within our local community enables us to support the sector’s ongoing efforts towards a sustainable energy transition.  As such, a policy of divestment from fossil fuels may support and further encourage this transition process within the energy sector.  These social responsibility and sustainability agendas are particularly relevant as we enter the recovery phase of the Covid-19 pandemic at a time when energy transition and a diversification of traditional local economic drivers in the north east of Scotland is accelerating. 

3. How will the University reprofile its investment portfolio to support divestment in fossil fuels?

The University is committed to using our unique position and influence to encourage and support the transition to the low carbon economy.  By 2025 we aim to have completed a process of ensuring that any investment in the energy sector actively reflects our own aspiration to support energy transition, through our research, teaching and other institutional activities.

Currently, the University does not invest directly in any fossil fuel company, and indirect holdings in pooled assets are less than 3% of the total investment portfolio. As we pursue the alternative opportunities outlined below, we will reduce those holdings in pooled assets to zero by 2025, or sooner if practical.

To achieve this, we will seek to find alternative investments in pooled funds and will continually benchmark our success over the next four years, monitoring and reporting on our progress across a broad range of metrics.

In addition, by 2025, we will seek to invest a proportion of our funds (at least 5% of our portfolio) in an impact and thematic investing programme. This programme will invest directly or through pooled funds in businesses and sectors which are explicitly aiming to deliver an environmental and social return in addition to a financial return across a range of sustainability themes. In doing so, we recognise that existing energy companies are increasingly actively involved in energy transition. Where there is clear evidence that what were traditionally fossil fuel companies are leading the transition to clean technologies, then we may invest in them to signal our support for that leadership. Where we do so, we will continually monitor these companies to ensure that they are making progress in sustainable energy delivery.

4. Does the University directly invest in fossil fuel extraction?

The University has no direct investment in companies related to fossil fuel extraction, but there is some limited exposure (2.38%) through the pooled funds we currently invest in, which equates to £1.4M. 

5. What will be the impact of reprofiling the investment portfolio away from fossil fuels?

The University is committed to generating resources for investment in education and research year on year through a responsible and sustainable investment policy, whereby investments achieve the best return possible.  The decision signals the University’s commitment to sustainability.  The revised approach to investment is consistent with our wider commitment to achieve Net Zero carbon emissions before 2040.  

A number of studies and publications have indicated that divestment from fossil fuels has a negligible or potentially positive impact on the financial performance of investment portfolios, albeit performance will depend to a large extent on the performance of third-party fund managers to generate excess returns.  As always, we will adopt a careful, managed approach to ensure that our investments are protected.

6. Will you still continue to work with industry, including oil and gas companies?

Yes. Through our research, education and other activities we are committed to working in partnership with the energy industry as part of a just transition to a greener, more sustainable future.  The University of Aberdeen has long-standing relations with the energy sector, and a track record of working in collaboration to support training and advancements.  We will continue to work with the energy sector to train the next generation, in support of our commitment to net zero before 2040.

Industry funding for research remains vital if we are to meet wider societal ambitions around Net Zero. In addition, there are opportunities to benefit from new sources of funding as climate change becomes an ever greater focus for grant awarding bodies and other research funders – as well as a rapidly transforming energy industry.

7. Will you still accept applications and associated funding for students sponsored by oil and gas companies?

Yes. The transferable skills that we teach on our energy related programmes will support energy transition.

Our curriculum portfolio is kept under regular review, in consultation with stakeholders as we continue to evolve our training skills to meet current and future demand. 

In addition, we recognise that different countries are at different stages in their work on this issue and we are committed to working with a broad range of our stakeholders to advance thinking on sustainability more widely through our education and research.  We believe this approach opens up new areas of expertise and supports skills and training needed for a just transition. 

8. Why have you not taken the decision to divest from fossil fuels before now?

The University’s Sustainable Investment Policy has evolved regularly in recent years.   From initially adopting an ESG (Environmental, Social & Governance) approach that saw investment decisions and exclusions guided by the principles of the UN Global Compact, a more focussed shift in January 2020 saw the Investment Committee take the decision to divest from coal and tar sands.  We recognise this is a rapidly evolving area and as such our approach to divest from fossil fuels, has remained under review. This process was given added impetus by wider societal and sector developments, the launch of our Aberdeen 2040 strategy, which makes clear our commitment to sustainability through our research, education and investments, and discussions with our student body.

9. What else does the University not invest in?

Our investments are governed by a Sustainable Investment Policy, which is managed through the Investment Committee.  The Sustainable Investment Policy stipulates that we will endeavour not to invest in companies that fail to comply with the 10 principles underlying the UN Global Compact, which calls on companies to align with universal principles on human rights, labour, environment and anti-corruption, and take actions that advance societal goals.  The University has already committed to not directly investing in companies whose business has a significant interest in tobacco, weapons and/or coal and tar sands. Our Sustainable Investment Policy will now be amended to reflect the commitment to reprofile our investment portfolio away from fossil fuels.

10. What contribution is the University making to address the climate crisis?

Energy transition forms a key part of the University's Aberdeen 2040 strategy where we pledge to show leadership in working for the sustainable future of our planet through our research, teaching and other activities.

We have recently been named among the top 60 universities in the world in terms of our positive impact on society by the Times Higher Education (THE) Impact Rankings, and so while we recognise there is more to do, we are in a very strong position to make further progress in our regional and global contributions to sustainability.

Research

Across multiple disciplines, our academics are making a direct contribution towards addressing the climate crisis.

  • Through our recently launched Centre for Energy Transition, we are working across disciplines to harness our capacity and expertise across research, innovation and skills development to benefit wider society, and support a long-term, sustainable regional and national green recovery based on a Just Transition.
  • Work is already well underway across the University to advance energy transition research in key areas including renewable generation, the hydrogen economy, biomass and carbon capture and utilisation. 
  • Our environmental research is using a range of cutting-edge technologies to deliver insight and understanding on the causes and impact of climate change, land management practice, environmental sustainability and pollution.

Teaching

  • We are developing education and training that is responsive to the needs of employers and communities to progress a green recovery, such as the UK's first postgraduate degree programme in Energy Transition Systems and Technologies and our recently launched MSc in Sustainability Transitions.
  • Being at the heart of the UK’s energy industry in Aberdeen means we have a long-standing collaborative relationship with the key industry stakeholders with whom we work in partnership as we seek to further evolve our activities in line with sector and societal ambitions around Net Zero.
  • This reflects a decades-old pattern of constantly updating and adapting our courses in consultation with industry, harnessing their collective knowledge, to ensure that we continually produce quality graduates with the skillsets to make a real and lasting contribution to the energy sector.  This will continue to be vital if regional, national and global ambitions around the energy transition are to be realised.

Other activities

As a University we are undertaking a number of activities to reduce our carbon footprint, as we work towards our aim of Net Zero carbon emissions by 2040. Examples include:

  • Most recent five-year Carbon Management Planning period has seen a 34% reduction in recorded emissions.
  • Extensive programme of energy efficiency projects across campus e.g. glazing, LEDs, insulation, lighting controls.
  • Controls measures and lagging to improve the efficiency of our Combined Heat & Power engine.
  • Certified renewable electricity supply for our Old Aberdeen campus.
  • 1000m2 of solar panels at our Hillhead residential site.
  • BREEAM ‘Excellent’ accreditation for all new buildings. BREEAM is the world’s leading sustainability assessment method for masterplanning projects, infrastructure and buildings
  • Awareness raising activities with staff and students.
  • Electric pool-bike scheme (staff and students) and a cycle-to-work scheme for staff.
  • Virtually no waste now to landfill with improved recycling rates and residual material to energy-from-waste.