Commentary: Why Canadian universities and banks should follow Queen’s and RBC and resist oil and gas divestment activists

Theological Hall building on campus of Queen's University in Kingston, Ontario, Canada. Getty Images photo

First Canadian universities, now Canadian banks. At a recent event at Queen’s University where David McKay, CEO of RBC was speaking, activists targeted both.

For years activists have been going after institutional investors like the $1-billion-plus Queen’s University Endowment Fund, insisting they divest from oil and gas stocks. They are now also targeting the Canadian Big Five Banks, starting with RBC, demanding that it “divest and stop financing fossil fuels.”

This action, in theory intended by the activists to strike a blow against climate change, could actually increase global greenhouse gas emissions and should be regarded as a strike against the prosperity of Canada and Canadians.

A bit of history on the divestment movement at Queen’s. In 2015, under aggressive pressure from divestment activists, the university undertook an extensive consultation period to decide whether or not to divest the endowment fund of fossil fuels.

They invited both sides to present to the board of trustees and asked for input from students, alumni, faculty and staff. They sought the viewpoints and opinions of many different groups and ultimately decided not to proceed with divestment.

Post-decision, a Queen’s Gazette article quoted some of the university trustees:

“Queen’s is an academic institution whose core activities are teaching and research. The university’s endowment funds exist solely to further these activities and the university has an obligation to seek the best possible return on these investments in order to advance its academic mission,” said Don Raymond, chair of the Investment Committee.

“The Investment Committee agreed that divestment is an ineffective tool to mitigate the risks of climate change and would result in Queen’s losing any moral suasion it has with companies in this sector.”

The article goes on to say that “the committee recognized that fossil fuel industries are lawful, highly regulated and carry social and economic benefits. There are more effective contributions that Queen’s can make to help address climate change through education, research and innovation, and in its operations.”

Fast forward to November 2021, and all of the above statements still hold true. Not surprisingly then, Queen’s has continued to resist the divestment agenda.

Queen’s University and all Canadian universities should focus on education, research and innovation to come up with leading edge technologies that will truly reduce emissions. They should avoid empty political statements like divestment which have no discernible impact on emission reductions.

And why should and would Canada’s largest bank stop investing in and financing the companies that fuel every other sector and company in Canada?

Canadian manufacturing, mining, forestry and agriculture are highly energy intensive: all of them need access to the energy that comes from hydrocarbons. These companies are also a huge part of the economic engine that drives the Canadian economy.

Why should educational and banking institutions continue to invest in hydrocarbons? Investing in hydrocarbons fosters innovation and solutions like carbon capture, utilization and storage, and clean hydrogen.

Investing in Canadian hydrocarbons ensures oil and gas supplies come from countries with high governance standards. Investing in Canadian hydrocarbons means investing in the industry that fuels every other industry on our stock exchanges. Investing in hydrocarbons means investment in the most productive sector in Canada.

Our universities and banks need to reject the activist agenda to divest and instead invest in Canada’s hydrocarbon sector for the good of the economy, the environment, shareholders and everyday Canadians.

Gina Pappano is the former head of market intelligence at the Toronto Stock Exchange and executive director of InvestNow Inc., a non-profit dedicated to demonstrating that investing in Canadas resource sectors helps Canada and the world. Join the movement and pass the InvestNow resolution at

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