By: Amy O’Donoghue
LSE hosted an informational session on its Environmental, Social and Governance (ESG) Policy, regarding its investment activity. This comes after intense pressure from students during the 23/24 academic year for LSE to divest from harmful industries, culminating in LSESU Palestine Society’s ‘Assets in Apartheid’ report, as well as the SU referendum in which 89% of respondents voted to divest from fossil fuels and weapons.
The session was led by Mike Ferguson, LSE’s Chief Financial Officer, and Caroline Butler, the Senior Independent Adviser on ESG policy.
During the session, Ferguson and Butler discussed the policy approach towards LSE’s investments, which amounted to £545.7 million at the end of 2024. Butler emphasised sustainability, claiming there is a regrettably low profile of recognition for how much LSE has done for climate change. She highlighted that they have invested £270m on energy efficient buildings since 2017, and raised £175m in green bonds.
In November 2022, LSE committed to a new ESG strategy, which attempted to “minimise investment exposure” to companies profiting from thermal coal, tar sands, tobacco manufacturing, and indiscriminate weapons manufacturing.
When questioned about LSE’s motivations for divestment from the tobacco industry, Butler responded that the decision was solely based on the financial risks associated with continuing to invest in this industry.
Questions were also raised about whether the investment guidelines adequately consider concerns for human rights. One audience member pointed out that human rights were scarcely mentioned in the university’s written ESG policy.
Another asked whether further action would be taken to make investment policy more ethically compatible, in line with the findings of the 2024 ‘Assets in Apartheid’ report. The report, which was produced by a collaboration of LSESU societies, claimed that LSE invested into companies profiting from mass human rights violations in Gaza, such as Toyota and BAE Systems.
Butler responded that ethics were an “impossible question” in investment. Another audience member probed further, questioning the panel on whether they were fully considering the risk of their investments potentially tied up in human rights violations further down the supply chain. Butler stated there was no concern because LSE’s investments were fully in line with British law.
There are further ESG discussion sessions scheduled throughout the year, so students will have more opportunities to confer with administrators on how LSE investment policy works and how it could be improved in the future.
