Universities fail on fossil fuel finance

Written by Lori Campbell on 4th Oct 2023

Every UK university that has committed to divest from oil and gas still banks with a leading fossil fuel funder, new research reveals.

This is despite three quarters of students stating that their universities bear a duty to tackle climate change. More than half (60 per cent) of those polled say they do not want their university to associate with a bank that funds fossil fuels.

The analysis by campaign group Make My Money Matter (MMMM) found that ALL 95 universities with a pledge to break ties with fossil fuels hold a relationship with at least one of the UK’s banking giants – Barclays, HSBC, Santander, NatWest, and Lloyds.

These five banks have collectively funnelled $419 billion (£345 billion) into the fossil fuel industry since 2016, when the landmark Paris Climate Agreement was signed. This includes $141 billion (£116 billion) to the world’s top fossil fuel expanders.

Call to action

MMMM is now calling for universities with a divestment commitment to engage with their bank, introduce consequences if engagement fails, and ultimately, switch banks if they refuse to stop financing new oil and gas projects. It wants students to send a message to their universities urging them to make smarter banking choices.

The group’s co-founder, Love Actually director Richard Curtis, said: “As the climate crisis intensifies – with the evidence all around us – we should all be looking at our banks to find out if they are financing fossil fuel expansion. This is particularly important in the case of universities.

“When they hold their money with banks who are bankrolling new fossil fuels, they are not just going against the wishes of their students, but actually jeopardising those same students’ futures. Why fire up your students with learning and at the same time condemn them to living in a world on fire?”

Find out more about the campaign here

Banking on Barclays

Freedom of Information requests made by MMMM reveal that almost three-quarters (73 per cent) of the divested universities bank with Barclays. These include the University of Bristol, University College London, and the University of Glasgow, which was the first university to commit to divest from fossil fuels in 2014.

Barclays is the UK’s biggest contributor for fossil fuel finance since the start of 2016, providing the industry with almost $190.6 billion (£157 billion). Earlier this year, Barclays received major pushback from investors for its continued role in driving the climate emergency and ‘weak’ new fossil fuel policies.

ShareAction’s head of asset owner initiatives, Emma Robertson, said: “Universities have an opportunity beyond their investments to send a clear message to companies, including banks, to scale up action to shift our economies to net-zero. We know that Barclays, which is Europe’s largest financier of fossil fuels since the Paris Agreement, has a lot of room for improvement.”

Top 5 LEAST ethical banks – and where to move for good

The power of students

A poll by MMMM and Students Organising for Sustainability found that nearly one-third (29 per cent) of students said they would feel uneasy about continuing their education if they learned that their university was linked to a bank that supports fossil fuel initiatives.

Students Organising for Sustainability’s Nat Gorodnitski said: “Banks are the biggest funders by a long way and rely heavily on the higher education sector for recruitment, reputation, and business, while their fossil fuel financing contradicts academic research, university policies, and students’ needs.

“This gives students and universities the unique power to pressure banks to end their fossil fuel financing in a meaningful way, and call for a shift to funding sustainable energy, where there’s a real future for students’ careers and lives.”

Meanwhile, separate research by climate journalism site DeSmog reveals that fossil fuel companies have provided £41 million to 44 UK universities in research agreements, tuition fees, scholarships, grants and consultancy fees since 2022.

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