The Rockefeller family is attracting adulatory press coverage for its decision to divest their $860 million charity, the Rockefeller Brothers Fund, of its investment in fossil fuels.
There are at least two significant catches, however. As the statement from the Rockefeller Brothers Fund puts it:
Given the structure of some commingled investment funds and investments in highly diversified energy companies, we recognize there may continue to be minimal investments in our portfolio in those energy sectors, but we are committed to reducing our exposure to coal and tar sands to less than one percent of the total portfolio by the end of 2014. As we take the steps to divest from coal and tar sands investments, we are also undertaking a comprehensive analysis of our exposure to any remaining fossil fuel investments and will work with the RBF Investment Committee and board of trustees to determine an appropriate strategy for further divestment over the next few years.
Second, there's no word at all indicating that Rockefeller & Co., the family investment and wealth management firm that says it has $44 billion of Rockefeller and outside money under management, will follow suit. As recently as November 2012, Rockefeller & Co. was touting North American shale oil and natural gas as a "once or twice in every generation" investment opportunity, in a market commentary that makes for interesting reading in the context of the announcement by the Rockefeller Brothers Fund.
It's as if the Rockefeller family decided that vegetarianism is such a fine idea that by year end all of their household staff are going to stop eating meat. Divest the charity from fossil fuels, but not the family's own personal wealth and not the wealth of the clients that the family earns money for managing.