The creation of a new cash market by dozens of leading UK universities?that want to stop financing fossil fuel expansion has been hailed as an ¡°unprecedented move¡± in the sector.

Managing more than ?5 billion in cash and investments between them, the 21 universities,?led by the University of Cambridge, have jointly issued a formal request for suitable financial products that do not contribute to the financing of fossil fuel expansion.

The coalition,?, are attempting to avoid financing companies that are constructing new coal- and gas-fired power plants in Organisation for Economic Co-operation and Development (OECD) countries.

The institutions, which include the universities of Bristol, Edinburgh, Leeds, Manchester, Oxford and St Andrews, have issued a request for proposals (RfP) to financial institutions for cash products such as deposits and money market funds. Other participants in the group include the London School of Economics and UCL.

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Anthony Odgers, Cambridge¡¯s chief financial officer, said the alliance was focused on ¡°finding financial services products that do not contribute to the expansion of fossil fuels ¨C in particular, new coal- and gas-fired plants?that lock in demand for decades¡±.

Zak Coleman, campaign manager at Investment for Change, which is seeking to push universities towards more environmentally friendly financing, described the initiative as an ¡°unprecedented move¡± for the sector.

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¡°It sends a clear message to incumbent banking providers like Barclays, Lloyds and NatWest: stop financing dangerous fossil fuel expansion ¨C which scientists and energy experts are clear must not continue ¨C or risk losing hundreds of millions of pounds in business and dozens of your most high-profile, long-standing clients,¡± he said.

¡°Students and universities just aren¡¯t buying the greenwash.¡±

Responsible investment is a mainstream part of equities investing, but it is still not widespread in the debt markets, even though a large majority of the new capital for companies constructing new fossil fuel power stations or exploring for new reserves comes from debt.

For this reason, the institutions have focused on banks and the bond market as the primary sources of external financing for fossil fuel expansion.

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¡°The university treasurers in this group all share a common goal, which is to manage money in a way that doesn¡¯t contribute to the financing of fossil fuel expansion,¡± said Heather Davis, Cambridge¡¯s head of group treasury.

The institutions to have signed on so far are hoping that others will follow suit to create a much bigger coalition within the sector.

patrick.jack@timeshighereducation.com