Understanding Divestment: What Does it Mean?

Learn about the impact of divestment and how it is used to align investments with values in this comprehensive article.


Divestment is a strategy used by individuals, corporations, and institutions to rid themselves of assets that are considered unethical, harmful, or morally objectionable. It involves selling off stocks, bonds, or investments in companies or industries that conflict with one’s values or beliefs.

Types of Divestment

There are many types of divestment, such as socially responsible investing, fossil fuel divestment, tobacco divestment, and weapons divestment. Each type focuses on specific industries or practices that individuals or organizations want to avoid supporting.

Examples of Divestment

  • Harvard University divested from tobacco companies in the 1990s due to health concerns related to smoking.
  • The Rockefeller Brothers Fund announced in 2014 that they would divest from fossil fuels because of climate change concerns.
  • Several pension funds and universities have divested from companies that manufacture firearms in response to gun violence.

Case Studies

One of the most well-known divestment campaigns is the movement to divest from fossil fuels. Organizations like 350.org have been leading the charge to get institutions to sell off their holdings in coal, oil, and gas companies. As of 2020, over 1,200 institutions representing $14.56 trillion in assets have committed to some form of divestment from fossil fuels.

Impact of Divestment

Divestment can have a significant impact on companies and industries. When large investors like universities, pension funds, or governments divest from a particular sector, it can send a powerful message to the market and put pressure on companies to change their practices. It can also affect the financial stability of companies by reducing their access to capital.


Divestment is a powerful tool for individuals and organizations to align their investments with their values and create change in the world. By divesting from harmful industries and practices, we can help shape a more sustainable and ethical future.

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