What’s going on with LSE’s ESG Review and student-led campaigning for divestment?
Last Tuesday, LSE hosted its final public event as part the ESG Review process. At the event, student campaigners staged a walk-out to protest the ESG Review and the repeated disregard for demands by students, staff, and the SU for human rights and international law to be integrated into the future investment policy. After many months of trying to engage with LSE through the Review, the SU echoed the frustration and disappointment that student campaigners expressed last Tuesday.
How did we get here?
In July 2024, LSE Council agreed to move the scheduled review of its Environmental, Social, and Governance (ESG) Policy forward by a year because of the Divestment Campaign and encampment organised by students and members of PalSoc.
Students voted in large numbers in an all-student, union-wide vote last summer for divestment, and as a result there is now a student policy that requires the Union to actively lobby The School to divest from fossil fuels and weapons, including indirect investments.
At the start of the Review, the SU stated that, if there couldn’t be a democratic process, there should be a meaningful consultation. The key to this was pushing back on what many students saw as LSE’s attempt to pre-emptively block discussions about how human rights and international law could be integrated into the future investment policy by refusing to discuss, let alone reconsider, the decisions made by Council in July 2024 as part of the current ESG Review. Since then, there have been active efforts to engage and understand the ESG Review. The Sabbatical Officers have been meeting regularly with staff administering the process to understand how students and SU can contribute to the process.
However, despite the SU’s active and good faith engagement with the Review, there have been growing frustrations with the lack of transparency of the Review and, as a result, the SU believes that the process has failed to ensure student and staff perspectives can genuinely shape any new policy.
LSE staff have repeatedly responded to questions about how the Review is structured, claiming: ‘this is not a democratic process’. Although there is an understanding of the difference between a consultative and democratic process, the primary belief is that understanding how recommendations for the new investment policy are created and informed by the consultation, is fundamental for the SU and students to be able to engage and trust in this process.
What about the Review and Consultative Groups?
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The Review Group
Made up of individuals both internal and external to LSE, some of whom sit on LSE’s Investment Sub-Committee, Finance and Estates Committee, and Council. They hold the power to reject the proposals and ideas put forward by the Consultative Group. The Review Group will ultimately make recommendations to LSE Council on how to change the investment policy.
Since November 2024, the Consultative Group (CG) has been meeting with the Review Group with the aim of reviewing LSE’s ESG policy. This has included preparing a working paper that explores how international law could be integrated in the policy, as well as organising the briefing notes for ESG Review workshops, and reviewing the paper submissions created by members of the LSE community.
What have LSE’s ESG Public Events been like?
Last week’s ESG event, during which students staged a walkout, was the culmination of several events hosted by LSE staff as part of this Review process, to allow the LSE community to explore various aspects of LSE’s ESG policy. LSE’s first public event offered an overview of LSE’s current approach to its investment policy and was delivered by LSE’s Investment Adviser. Overall, the session framed the questions at the core of the ESG Review process—where and with what impact does LSE invest its money—as fundamentally technical questions.
This technical and apolitical framing of the questions of LSE’s investments was evident in how the following sessions were structured and facilitated. It was believed that all feedback that the session produced would be communicated to the Review Group by the members of the Consultative Group, but the low attendance by members of the Review Group meant students and staff expressed concerns that their insights and ideas might not actually be heard by those with decision-making power.
There is great concern that the consensus and points of agreement that emerged in the workshops around specific issues has not been communicated to the Review Group. Students and staff in attendance were often in agreement on substantive issues, such as human rights and divestment from arms, and at every event, students and staff raised questions about what they saw as inherently political principles underpinning LSE current approach to its investments, specifically LSE’s continued commitment ‘to motivate a change in corporate behaviour through positive manager engagement,’ which was questioned by students and staff. Students campaigners, drawing on their own research, explained clearly that LSE does not have the capacity to engage with all the companies in which it invests to ensure they are not breaking international law, polluting land, or exploiting workers because, for one, it does not know all of the companies in which it invests indirectly through its fund managers.
Throughout the Review, LSE repeatedly failed to provide a clear explanation of the consultative process. When the Sabbatical Officers sought meetings with members of staff and the Review Group to understand their perspectives, they were told that it would jeopardise the impartiality of the Review. This sense that meaningful consultation was beyond reach was reiterated by the fact that none of the substantive issues that were discussed in previous sessions—human rights, engagement vs. Divestment etc.—were on the agenda for the final meeting, raising concerns for many students about whether these issues will make it into the final recommendations.
The SU will continue to support student campaigners to push for meaningful divestment as part of this ESG Review. There will be continued engagement with the Review and with LSE until the end of this process, to ensure the voices of students are included in every discussion. According to the Schools' communication at last week’s event, LSE Council will consider the Review Group’s recommendations in the LSE Council meeting on the 24th of June.
We need you!
Join the Town Hall/Annual Student Members Meeting on the 30th of May 2-4pm where there will be an emergency discussion on the divestment campaign and the ESG Review.
You can get involved in the campaign for divestment by emailing su.campaigns@lse.ac.uk.