Change needed in UR investments

Drue Sokol, Photo Editor

Think global, act local’ is a common message promoted by awareness groups on our campus. It could very well be the case that we are able to encourage positive socioeconomic change through our actions here at the University. However, we ought to take a closer look at the ways in which we seek to make change, and the impact of such initiatives. If we are truly concerned with change that has global implications we need to identify the structures and institutions that are, in part, responsible for creating the deplorable social, economic and environmental conditions we wish to ameliorate. Socially responsible investing is one way in which the UR community can foster positive change across the globe.

Our endowment stands at approximately $1.7 billion. Its management is complex, but what is important to know is that a portion of the endowment is strategically invested to yield profits, which helps our endowment grow and allows the University to function as the institution we know and love. Our university, however, is currently invested in multi-national corporations that are involved in vast environmental degradation, war profiteering, unethical labor practices and other human rights abuses spanning multiple continents according to investment information disclosed upon request from The Office of Institutional Resources, Spring 2012. One such corporation is Chevron-Texaco. In a report issued by Amnesty International regarding the destruction of the Amazonian ecosystem in Ecuador, Chevron-Texaco “intentionally dumped more than 19 billion gallons of toxic wastewater into the region and was responsible for 16.8 million gallons of crude oil spilling into the rain forest” among other heinous ecological crimes. Chevron-Texaco has refused to aid in mitigation efforts despite being found guilty of rampant pollution by Ecuadorian courts in 2011. Such negligence has grave implications for Ecuador and beyond.

Another corporation we are invested in that is wreaking havoc in the developing world is Monsanto, the second largest producer of genetically modified seeds. Monsanto’s predatory business practices have put farmers and their families into severe debt, which contributes to an estimated 1,000 farmer suicides each month in India alone. Monsanto’s profit comes at great ecological, economic and social cost to farming communities and global food security.

General Dynamics, another corporation that our school is invested in, directly profits from war. As the fourth largest defense contractor, they manufacture weapons, vehicles and gear that aid in the proliferation of armed conflict worldwide. The military-industrial complex is soaked in the blood of innocent people from here and abroad. We should do our best to minimize our involvement with firms and institutions whose only motive, profit, is advanced through the perpetuation of warfare. General Dynamics has also been found guilty of discriminating against African American and female employees, in addition to violating health and safety regulations set by the U.S. Occupational Safety and Health Administration on multiple occasions.

Last but certainly not least; our university is invested in J.P. Morgan Chase. Chase was one of the firms responsible for our recent financial meltdown, having been involved extensively with subprime and predatory lending. Chase and other major banks knowingly participated in the lucrative and unregulated sale of faulty mortgages. When the house of cards came crashing down, they were first in line for aid, receiving $94.7 billion in the taxpayer funded, government-backed bailout of 2008. Today, they remain one of the most vocal opponents of federal regulation to discourage the practices that caused a global economic collapse just four years ago. Chase has been issuing eviction orders across the nation during the ongoing foreclosure crisis. These evictions are often executed by taxpayer funded police departments. After a $94.7 billion bailout, I guess the joke is on us.

During the peak of the housing boom in 2006, The Center For American Progress reported that J.P. Morgan Chase and their affiliates were more likely to steer black and Latino applicants than white applicants into higher priced subprime mortgages: 47.5 percent of black borrowers and 36.6 percent of Latino borrowers in comparison to 16.4 percent of white borrowers. This racial disparity was not reproduced, but in fact greater at higher income levels. This raises questions about institutional racism and discrimination in the bank’s lending practices and the way the foreclosure crisis continues to play out in towns and cities across the nation.

The examples above suggest the interests of multi-national corporations conflict with ethical labor practices, environmental stewardship and other humanistic, socially just and progressive values. The fact that we are stakeholders of this university implies that we have a say in how funds from the endowment are being used, particularly when these funds are invested in corporations complicit in such reprehensible activities. Let us collectively develop a more ethical framework for managing our endowment — an initiative undertaken successfully by peer institutions like Columbia University, The University of Pennsylvania, Swarthmore College, Massachusetts Institute of Technology and Brown University.

If we truly wish to have a global impact by acting locally, we ought to seek more transparency as to how the endowment is managed, question our university’s investment in corporate entities engaged in irresponsible, destructive behavior and ultimately divest from socially irresponsible companies. The best way to ensure the sustainability of such an initiative is the establishment of a democratically elected committee of students, faculty and staff to oversee the endowment and the utilization of its resources in accordance to the core value of this institution, Meliora. Our endowment should not grow at the expense of other human beings or the environment.  The next step is a forum that fosters meaningful community and campus-wide dialogue regarding alternative financial structures that provide fair returns on an ethically invested endowment.
Let us put our money where our mouths are, and begin to truly engage in the practice of thinking globally whilst acting locally.

Alani is a Take Five Scholar.



You can contact Alykhan at aalani@u.rochester.edu.

    5 Responses to “Change needed in UR investments”

    1. Adam says:

      I will start by saying, nice research. However, what is the point of investing if it isn’t to make profits? Should the University not invest in strategically profitable stocks? If the U of R didn’t invest in these companies, it really wouldn’t make a difference anyways. People want to get ahead and will do anything to accomplish that. As for the farmers, it is the same as bullied teens here in the US, no one made them commit suicide, so therefore the people who upset them can’t be held liable for their deaths. If you really want to stop exploitation by multinational corporations, you would have to actually create an effective system of international law, which won’t work in a world run by a few super powers.

    2. AVIV BROKMAN says:

      Nice article. It seems like you’re making progress. The challenge is to find profitable, ethical investments. I’m guessing you have the beginnings of a list of companies you don’t want to invest in (for the sake of curiosity, could you post it somewhere or lead me to someone else’s list you like?). Have you talked to anybody (a financial expert) that has confirmed that what you’re looking for exists? It seems like there are three choices: invest in profitable bad companies, divest from all, or invest in profitable good companies. I think you’ll make the best case if you push for latter. But first you have to make sure it exists. If you’ve already confirmed it, let me know! It’s always nice to get one’s pessimism disproved.

    3. SHENICE MORRIS says:

      To think that here at the university we live more or less comfortably with the amazing opportunity of creating a future for ourselves while this very institution plays a subtle but active role in taking away the futures of many. It is sad to think that our comfort and well being is being put in front of others. Why is that? Are they less than human beings than we are that it doesn’t matter if their atmosphere becomes toxic to human, animal and environmental life on these other countries? Toxic waste that has the ability to end life, deform newborn babies, wipe out entire species, and cause life long health problems.

      Adam, when will the individual stop being at fault and the way society is run be at fault? A society governed by international and local policies create the conditions in which many suicides occur. The Indian farmers example is great for showing how international policy can affect the livelihoods of people. Although these policies did not physically put a noose around people’s necks or however they chose to end their lives, they live in conditions that make them feel depressed, hopeless, less than human beings etc. Should we as a global society ignore these man made conditions and say “well we didn’t physically kill them” or should we work on changing those policies that burden people literally to death?

      • Adam says:

        Shenice,

        Life is a game to be played. Games have winners and losers. It is up to the individual to fight the odds and win. If someone is exploiting your land, stand up to them. I know insurgents in some parts of Nigeria have targeted foreign owned oil facilities. That is good for them. However, since I like my gas cheap, I support China’s sending of more guns and patrol boats to those regions of Nigeria (which are horribly polluted and impoverished). Whether or not you support the Indian farmers depends on what your goals are; I like cheaper goods, maybe you like seeing people live happy lives (mine’s more realistic btw).

        Also, do you think that I always lived in a comfortable university. I’ve lived in some of the most miserable places in the US and have been faced with loads of adversity. However, I am here now, living comfortably. Why? Because I capitalized on every opportunity and did whatever it took to get ahead. Instead of committing suicide, people should fight back, and at least that way they have some chance of succeeding (because suicide almost always results in losing)

    4. SHENICE MORRIS says:

      Adam,
      The question we need to ask ourselves is: is there a way we all can live comfortably and have the goods we need and want, more or less, without overly exploiting resources and unnecessarily devastating the lives of others?

      I think once one realizes the answer is yes, one realizes that life doesn’t have to be this way. Also, I believe it takes a certain kind of education to learn this, an education that is out of line with the ruling class that have told us for centuries things like, “this is human nature” “people are greedy,” “no other society exists.” These are the ideas we are taught in school (an institution controlled by the ruling class) but is it really so? I got an education on history and philosophy outside of school and my ideas about society changed drastically.

      Also, sometimes an act of suicide can be viewed as a voice saying, “We need change!!!”


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