Divestment is still all the rage in liberal circles these days, particularly when it comes to universities and their investment portfolios. Usually the target is Israel, but there’s also been a rash of schools talking about divesting from investments in the energy sector, particularly when the money might be coming from coal or other fossil fuels. So how much effect has this been having on the energy industry? According to a report from Bloomberg, not much since most of them weren’t investing in that sector to begin with.

Stanford, Oxford and Georgetown universities have won praise for promising to purge their endowments of direct investments in coal, embracing the fight against climate change.

One detail gets lost in the celebration: the colleges have few, if any, such investments to sell in the first place.

Almost three dozen colleges have announced ‎fossil-fuel divestment pledges over the last three years, and their actions tend to have less substance than advertised. The divestment movement is letting colleges take credit for largely empty gestures, when it should be focused on energy conservation or measures such as a tax on the carbon emissions, that could curb global warming, some academics and environmentalists said.

“These efforts are pure window dressing,” said Frank Wolak, an economics professor who directs Stanford’s energy and sustainable development program. “And, much to my surprise, the student groups are complicit in this deception.”

Activists have campaigned on hundreds of campuses demanding universities sell shares of 200 companies with the largest reserves of oil, gas and coal. Six of the ten richest schools complying have limited pledges by considering only direct investments, excluding money overseen by outside managers. Many said they would unload only coal companies, which the colleges said were the worst polluters.

Of course the students are complicit in this deception. That’s because this was never about money or principle in the first place. It was about headlines and looking like you’re in with the green energy and social justice warriors who are going to save us all from ourselves. The activists would have looked rather silly if they were pushing divestment and didn’t bother to check and see what the school was investing in to begin with. For example, they clearly had to know that Georgetown has a $1.5B endowment and they cheered when the school said they would be removing all “direct” investments in coal. But they probably also knew that there were two key factors in that announcement. The school came out and admitted that those direct coal investments were “insubstantial.” But the “direct” part of the statement was key as well. A lot of their money – in fact most of it – isn’t directly handled and invested by people at the school. Investment banking is complicated and most of us prefer to shop that task out to professionals. With that in mind, Georgetown, like many of the other schools on the list, has most of their money in managed funds.

As you can imagine, those fund managers aren’t about to dump a bunch of holdings which are proven performers during a time when there’s an energy surge going on. But hey… the schools aren’t “directly” investing their money in fossil fuels so there’s no blood on their hands, right? (Or should I say “tar sand oil” on the their hands?)

Stanford was in a similar situation, though their endowment was orders of magnitude larger, coming in at roughly $21B. Their “direct” investments included what they called a “small fraction” of funds dealing with fossil fuels. And how did they deal with the sticky situation of the managed funds? (Emphasis mine)

The commitment amounts to only a “small fraction” of the portion of the $21.4 billion endowment that the university manages itself, according to Lisa Lapin, a Stanford spokeswoman. Lapin declined to say how much the university manages directly. Outside money managers were also encouraged to divest from coal, the university said.

“The board of trustees made a commitment to make no future investments in coal,” Lapin said. “As one of the nation’s largest institutional investors, this commitment is not inconsequential.”

So you “encouraged” the fund managers to not invest in coal, eh? I’m sure they’ll take that under consideration at their next board meeting when the rest of their customers are wondering why they would bail out of a huge cash cow. As far as the “future investments” go, that’s a great talking point for the student activists, but they weren’t putting any real money there in the first place.

Like so many things, this is primarily smoke and mirrors. It provides a reason for students to go camp out in the central square, carry signs and do up twinkles with the crowd. Under the covers, there’s nothing changing. But you just keep on saving the world, folks. If we keep digging in this manure pile long enough, there’s bound to be a unicorn in there someplace.