June 1, 2026
In 2021, Princeton University decided to dissociate from the thermal coal and tar sands segments of the fossil fuel industry. That decision, taken by the Board of Trustees in response to recommendations from the CPUC Resources Committee, required Princo to divest from holdings in that segment, which it did.
The Trustees separately asked the University to work toward achieving net-zero greenhouse gas emissions across the University’s endowment portfolio. Specifically, the Trustees asked Princo to set a target date for achieving a net-zero endowment and to establish a committee of subject matter experts to advise Princo on how to measure and benchmark the greenhouse gas impact of the University’s endowment.
In 2022, in what it described as a step toward a net-zero endowment, Princo voluntarily elected to divest from all publicly traded fossil fuel companies. This step was not required by thermal coal and tar sands dissociation, nor was it connected to the Resources Committee’s recommendations.
Since coming to Princeton in 2024, I have been thinking about how best to steward the endowment in two fundamental ways: to maximize resources for the University’s teaching and research mission, and to ensure the continuing alignment of Princo’s own operations with the University’s mission and strategic goals, among them a commitment to climate sustainability.
After consultation with experts, I’ve reached the judgment that we can do both things better if we make some adjustments to our approach. Accordingly, we are setting a holistic goal for a net-zero endowment by 2046–also Princeton’s target year for a net-zero campus–and will work methodically and deliberately with our investment partners, year-by-year, on progress toward measurement and implementation of that goal. As directed by the Trustees, I have also established the committee to advise Princo on how to measure the endowment’s emissions footprint.
It’s important to note that whether we achieve this target is to a meaningful degree contingent on sustained U.S. government policies that encourage reduced emissions, on the accelerated deployment of decarbonization technologies in the economy, and on consumer and industrial adoption of these technologies.
As part of our revised approach, I am discontinuing our voluntary divestment from all publicly traded oil and gas companies. The Trustee-mandated decision to divest from thermal coal and tar sands companies remains in effect.
It’s not obvious that Princo’s initial approach has moved the endowment meaningfully closer to net-zero, nor is it obvious that major energy companies will be out of bounds for a net-zero endowment. After all, this sector will necessarily play a significant role in the clean-energy transition we want for our nation and for the earth. These are questions we will explore in the years to come.
What is clear is that our revised approach will give Princo greater flexibility in managing an endowment whose resources are critical for financial aid and scientific research–including climate research–at a time when our sector is under financial strain. Princeton is the most endowment-dependent of any major research university in the world. That is a blessing, because it reduces our reliance on taxpayer funding and on tuition revenue. But it also means that self-imposed constraints on our investment strategy can have outsized impacts on our students, faculty, and laboratories–and on future generations of Princetonians.
As President Eisgruber noted in a 2022 column in the Princeton Alumni Weekly, “[d]ivestment, no matter how carefully designed, will not take a single molecule of carbon out of the atmosphere. When Princeton sells shares in a company, somebody else is buying those shares.” Our University’s true impact on the climate crisis, President Eisgruber added, will come from “the transformative impact of our faculty’s research and the intellectual and leadership contributions that our students and alumni make to the world.”
I believe our revised approach toward a net-zero endowment will enhance both the resources available to faculty and students and our potential to positively contribute to a more sustainable climate and environment. I don’t intend for this to be our final word on the topic. Indeed, I am here making a promise to deliberately explore the issue and to provide an annual update to the Princeton community about our progress toward a net-zero endowment, a goal which we take seriously.
Vincent Tuohey
President, Princeton University Investment Company