Roadblocks ahead as activists push for Jewish fossil fuel divestment — J.

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This piece first appeared in the Forward.

When Beth Sirull took over the Jewish Community Foundation of San Diego five years ago, she moved quickly to offer her donors — including local Jewish groups — the opportunity to put their money into a fund that “applies a Jewish lens to his investments. That meant buying Israeli bonds, funding affordable housing and using shareholder advocacy to push companies on social and environmental causes.

San Diego’s approach — versions of which are now available on the West Coast, Midwest and South — was not driven by outside activists. But it was introduced at the same time as students, pensioners and others began to step up calls for the institutions they are affiliated with to divest from fossil fuel companies to avert catastrophic climate change.

That pressure is now slowly spreading to the roughly $100 billion held in Jewish endowments and other investments, with this week’s Big Bold Jewish Climate Fest featuring a panel on how to divest from coal, oil and gas companies .

“I don’t think this is going to make or break the fossil fuel industry,” said Phil Aroneanu, chief strategy officer of Dayenu, a Jewish group focused on climate activism. “But it will have a cultural impact and help tell the story as we align our spiritual and moral compass with our investments.”

Aroneanu hopes that if fossil fuel investments become anathema in the Jewish community, it will add pressure on Wall Street companies that have the power to make or break energy companies. He pointed to an October protest outside the headquarters of BlackRock, the world’s largest asset manager, where three rabbis and six teenagers were arrested as they called on the company’s Jewish leader, Larry Fink, to divest fossil fuels.

But convincing Jewish community investment managers to sell their stakes in companies that contribute to climate change will not be easy.

“The money that is entrusted to the federation and to Jewish community foundations across the country is all the money that needs to be managed in a way that is good for the community now,” said Tony Abrams, director of the foundation. community at the Seattle federation, which is creating a sustainable investment option for donors. “But we also hold this money in trust for future generations.”

Long way to go

The two main sources of wealth in the Jewish philanthropic world are endowments and funds managed by community foundations on behalf of individual Jewish donors. The Jewish Federations of North America said federations and community foundations across the country hold about $21 billion in endowments and donor funds, with another 2,800 Jewish foundations controlling another $80 billion.

Not only do donors to these funds expect their money to be managed in a way that limits risk, but some of them have made their living in the very industries that are now under fire from activists.

I don’t think it’s going to make or break the fossil fuel industry. But it will have cultural impact and help tell the story as we align our spiritual and moral compass with our investments.

Fred Zeidman, a Houston-based Jewish philanthropist, called the move toward socially responsible investment funds in the Jewish community “just the California left regardless” and said he would not donate to the foundations that offered them.

“My theory has always been that we only have one way to vote — and that’s with our dollars,” said Zeidman, co-chair of the Council for a Secure America, which promotes relationships between oil and gas companies. Americans and Israel. “I wouldn’t invest in anything that would reduce activity in the fossil fuel industry.”

So far, Zeidman and other skeptics need not worry. Only a handful of Jewish nonprofits, including the American Jewish World Service, the Nathan Cummings Foundation and the Leichtag Foundation, have explicitly opted to divest from all fossil fuels. The federations and foundations that offer sustainable investment funds – including San Diego, San Francisco, Minneapolis and Atlanta – do not refuse to buy shares of energy companies.

Instead, many put donor dollars into a fund managed by JLens Investor Network, which aims to track the broad stock market while banning investments in coal, tobacco and for-profit prisons, and tries to use its assets to influence companies to improve their position on environmental issues. Even with this limited approach, only a fraction of Jewish philanthropic dollars end up in funds that consider anything other than how to make the most money in the safest way.

In San Diego, which has one of the most established sustainable investing strategies, Sirull said only about 10% of the $750 million his foundation manages is allocated to one of many socially responsible options. they offer.

“It’s little,” Sirull said. “But before, it was zero percent.”

Beth Sirull

One of the challenges, she said, is that while younger philanthropists are keen to hold their funds in investments that promote various social goods, older investors are used to compartmentalizing how they earn and manage their money depending on how they give it: “You make your money here and you give it there and the two don’t meet,” Sirull said. “So it’s a big challenge for education.”

The pressure can rise

Sirull and other proponents of impact investing in the Jewish community say early evidence suggests investing in sustainable options is no more risky and that these funds generate returns similar to those of traditional funds. Two Norwegian economists published an article in the journal Climate Policy last year that found that divestment from fossil fuels does not harm investors.

The shift towards sustainable investment options in the Jewish community has also occurred in the absence of any concerted pressure from activists like Aroneanu, who has successfully launched calls for major universities to divest fossil fuels during a previous post at 350.org, a secular climate group.

Instead, foundations began offering these options in part at the request of their communities. In Seattle, Abrams said Congregation Beth Sholom, a conservative synagogue known for its social justice work, asked if it could direct the funds it invested in the local conference to socially responsible causes. And federations are increasingly competing with green options offered by financial services companies like Charles Schwab and Fidelity, two of the nation’s largest donor-driven fund providers.

But Aroneanu said external pressure on Jewish community investment managers is likely to increase. Jewish voters ranked climate change as their top priority in a Jewish Electoral Institute poll last year, well ahead of issues like Israel, Iran and anti-Semitism, and they could demand that their synagogues and institutions communities go beyond the proactive focus on installing solar panels and holding educational workshops that, according to Aroneanu, have constituted a large part of the community’s environmental activism so far.

“The leaders of the Jewish world – the Jewish activists at the local level – understand that it is not only ‘all our responsibility’, but that there are in fact vested interests that cause delays and denials,” said Aroneanu. “If we act collectively through our investments and through our political action, we can really do something.”

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