Joining a rapidly expanding international network of institutions seeking to de-fund the industries driving global warming, Syracuse University on Tuesday announced it would divest its $1.8 billion endowment from coal mining and fossil fuel companies.
Divestment does nothing to “defund” any company. When Syracuse University purchased their shares of whatever oil company, they likely bought them second-hand from another investor rather than from the oil company directly. Certainly, when they “divested” they sold their shares to another interested investor. The oil company that originally issued the shares never even knew this transaction took place. The oil company only makes money on the original issue and sale of stock shares. They have no interest whatsoever in the subsequent sale or resale of those shares, other than an interest in making sure the stock price reflects a recognition of investor value.
Divestment is exactly the wrong strategy, obviously founded by folks who have no idea how the stock market actually works. The better approach would be for Syracuse University and other like minded institutions to buy up as many shares of oil stocks as they possibly could in hopes of forming a controlling bloc. At that point, they control the company and can direct its actions.