A recent analysis by Thomas Da Costa Vieira, a political economist at the London School of Economics and Political Science, argues that fiduciary duty should tell USS to get out of fossil fuels. Key points:

• Diverse portfolios which exclude fossil fuel assets have historically matched or outperformed traditional portfolios containing fossil fuel assets.
• A joint Imperial College Business School and International Energy Agency report found that that since 2010, across all portfolios that were considered, ‘renewable power generated higher total returns relative to fossil fuels’. 
• Other studies in the US, Canada and the Eurozone have reached the same conclusions.
• The recent temporary energy crisis, which significantly improved fossil fuel returns, has also greatly accelerated the transition to renewables, prompted by their relative cheapness and by energy security concerns; this has amplified further the medium and long-term attractiveness of renewables.
• The overall demand for fossil fuels will soon reach a peak. This has already happened in China for oil, due to high electric vehicle use. Fossil fuel capital expenditure now will release further product when demand is falling, risking profits, disorderly exits from the sector, and stranded assets.

Read more here.