By Ross Kerber
BOSTON (Reuters) – The $8.2 billion MacArthur Foundation said on Wednesday it would divest from fossil fuel holdings with changes to its equity indexes, becoming the largest foundation to move money away from the oil and gas sector.
Other institutions including Harvard University and the Maine state pension system have taken similar steps lately amid mounting climate change concerns, although some investors prefer to keep energy company shares to help find ways to cut emissions.
Two years ago the John D. and Catherine T. MacArthur Foundation of Chicago halted new investments in private funds that invest in oil and gas exploration.
On Wednesday, MacArthur President John Palfrey said it would go further and switch its equity exposure to indexes that exclude companies with fossil fuel reserves.
The foundation also uses externally managed funds, and has told those firms it wishes to be divested from fossil fuels, Palfrey said in an interview.
“It’s not a simple matter with an $8 billion endowment that’s invested in long-term managed funds,” he said. “The big news is we’re committing to this pathway. We’re making it happen, it’s not something you can do easily.”
Ellen Dorsey, executive director of the Wallace Global Fund, another philanthropy, who tracks the area, said MacArthur is the largest foundation in the world to commit publicly to fossil-fuel divestment to date.
A similar move in 2016 by the Rockefeller Family Fund was noteworthy because a century ago John D. Rockefeller Sr. made a fortune running Standard Oil, a precursor to Exxon Mobil.
The MacArthur Foundation had $8.2 billion in total assets as of Dec. 30. The amount of its fossil fuel holdings was not immediately available, a spokesman said.
The foundation is known for its $625,000 no-strings attached “genius” awards. It has also funded groups like the Sierra Club, which Palfrey acknowledged has drawn criticism such efforts have been at cross purposes with its investments.
(Reporting by Ross Kerber; Editing by Marguerita Choy)
