Investing in Justice
Students around the country are starting to look at university investments as a means of social activism.
By Emily Rutherford
January 27, 2009
Professor Dave Sauer, center, talks with students about investing university endowments at the University of Dayton in Dayton, Ohio. (AP Photo/Al Behrman)
One April, a chapter of Students for a Democratic Society at the University of Florida organized a hunger strike. They were struggling to get the attention of the university administration, which had been and remained unsympathetic to their concerns. Other actions, such as marches and rallies, had not elicited a response. Some students even stopped eating for up to 11 days. The administration didn’t change its position, but the
SDS students did garner support from around the country.
If asked to put a year to that April, or to guess the cause SDS was fighting for, it would be entirely logical to pick a time in the late 1960s or early ‘70s. But this hunger strike actually took place just last year, and it wasn’t about objecting to the Vietnam War or supporting the civil rights movement—it was about the state of the university’s endowment.
Endowments are sums of money generally made up of donations from alumni, states, or founders which are reinvested to generate revenue for universities. The principal, or the original sum of money, is not spent, but the interest contributes to a university’s yearly operating budget and special projects. Universities and the financial management companies they hire are dedicated to investing the endowment in the best way to maximize returns, so that the money can be used to forward the universities’ core missions of teaching their students and engaging in original research. But the forms that these investments take have been scrutinized by diverse groups of students at colleges and universities across the country, such as the SDS chapter in Florida.
UF’s SDS chapter, concerned that its school might have been investing in companies benefiting financially from the Iraq war, wanted the university trustees to release the contents of their investment portfolio and disinvest, or divest, from such companies. They advocated a socially responsible investment policy, whereby the University of Florida would not only consider what investments would provide the greatest return, but also what political and social messages universities were sending by investing in a particular company.
The students at UF were by no means the first group to question their universities’ investment policies. The original divestment movement in the ‘70s and ’80s objected to university investments in companies based in apartheid South Africa. These activists used nonviolent protest strategies to express their anger and objections, and were largely successful at persuading universities to divest. They also set a precedent for how universities would confront the issue of divestment.
Divestment student activism at Princeton University prompted its trustees to adopt a set of guidelines for the “consideration of investment-driven ‘social responsibility’ issues,” which established that the university should always avoid taking a stance on any investment but that “there may be very unusual situations” in which the investment might “conflict with the central values of the university.” At the time, this meant the tacit support for apartheid implied by the South African investments.
The standard has since been adopted by other universities. Some 30 years after Princeton adopted this standard, it has been applied to an increasingly diverse set of issues. A few years ago, Harvard was one of the first universities to divest from companies profiting in Sudan, in light of the genocide in Darfur. Other universities, seeing that human rights principles were at stake in a situation not dissimilar from the South Africa one, followed suit.
The UF students seeking divestment from Iraq war contractors have had less success with their cause—as have the increasing number of students arguing that their universities should only invest in environmentally sustainable companies. Though the College Sustainability Report Card notes that some universities have made efforts to keep their investments environmentally friendly, most do not believe environmental concerns are pressing enough to a shrink a budget, especially when endowment loss is at its worst since the 1970s.
It is difficult to determine when, if ever, a university’s commitment to its students and faculty can be outweighed by its commitment to broader social issues and to taking a stand over what is morally right. It’s no wonder that students take such diverse positions on issues related to investments. But all who support divestment campaigns are unified by the idea that they do not want to benefit from their universities’ investment in what they perceive to be unjust causes. Students passionate about social justice needed new causes, and they turned their collective focus to problems on their own campuses—including university investments.
In some ways, 21st-century advocates for divestment, like the SDS members at UF, have tactics from a previous era and even don a name like “Students for a Democratic Society,” but the issues they concern themselves with are very modern, from today’s war and today’s human rights violations to environmentalism. Hunger strikes seem almost from another era, but many other tactics that today’s divestment advocates use, such as the professional meetings with university officials that led to many of the Sudanese divestments, or the web publicity used by the Sustainable Endowments Institute and the new SDS, which ranks divestment among its principle causes, are consistent with the strategies often employed by the many young progressives seeking social change in the 21st century. As long as there are universities, there will be endowments to fund, and as long as there are there are divisive questions of justice, there will be movements for investment or divestment.
Emily Rutherford is a regular columnist for Campus Progress and a freshman at Princeton University.
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