Tone changes in investment ethics debate

Yale students have a storied history of making very public attempts to convince the University to divest from various holdings in its endowment. After years of highly visible discord, however, the investment ethics debate has now become more focused and less contentious.

While activists continue to lobby the Yale Corporation about investment ethics decisions, the discussion has become less demonstration-oriented. Those involved with the ongoing debate, conducted largely through Yale’s Advisory Committee on Investment Responsibility, credit much of the shift in tone to ACIR chair and School of Management professor William Goetzmann.

“There’s been a lot of gain in the last few years in the way [the ACIR] works,” ACIR student member Daniel Stone ’01 said. “Things activists wanted are now there — open meetings and a chair that takes it seriously.”

An open ACIR meeting Thursday afternoon will include public presentations on labor standards and the environment. Specific topics will include sweatshops and child labor, global warming and environmental liability reporting, Student Alliance to Reform Corporations member David Corson-Knowles ’03 said.

Activists have long taken issue with Yale’s refusal to disclose the vast majority of its investments. Since most of Yale’s investments are managed by outside sources and the law only requires disclosure of a non-profit corporation’s holdings in its own name, nearly 90 percent of University investments remain a mystery to the public.

The only consistent opportunity for investment ethics give-and-take with Yale administration is in the ACIR, an eight-member body with an undergraduate and graduate student representative. The ACIR advises the Corporation on investment decisions by reviewing shareholders’ proxy votes and making recommendations, which the Corporation almost always follows.

Under Goetzmann’s leadership, the ACIR has become a more public forum, enabling the committee to consider far more student input, including perspectives from members of the Student Alliance to Reform Corporations. A Web site now details topics discussed by the ACIR and some the decisions it made last year.

“The committee is definitely more responsive,” Corson-Knowles said.

STARC and other activist groups have since reduced their public presence. The organization’s less vocal approach comes even though the University still has not divested itself of frequently criticized items known to be in its endowment portfolio, including tobacco holdings.

Yale President Richard Levin also lauded the ACIR.

“The transparency has contributed to a greater atmosphere of trust,” Levin said.

Corson-Knowles said while progress had been made, there is still more that needs to be accomplished.

“We would like them to be more proactive in proposing shareholder resolutions,” he said.

The highly contentious debate over tobacco divestment three years ago did not go unnoticed by Yale administrators.

“There was a real effort to put thoughtful and responsive leadership on the committee,” said Provost Alison Richard, Yale’s chief academic and financial officer.

Stone said Goetzmann’s leadership is in no way an administrative attempt “to throw a bone” to student activists.

“He’s not a pawn of the Corporation in any way,” Stone said. “He’s not a super activist in any way either, but he has a social conscience.”

Goetzmann attributes the productive atmosphere to the mindset of all parties involved.

“I see a very positive attitude amongst all the members of the committee and a willingness to share opinions,” Goetzmann said. “Activists on campus have been very forthcoming with information and opinion and helpful to us in providing lots of data and information and resources [that we wouldn’t otherwise have].”

From their headquarters on Prospect Street, Yale's investment officers controls the University's multi-billion dollar endowment. Through a standing committee, students have a voice in issues regarding the University's investments.
Marissa Kellogg
From their headquarters on Prospect Street, Yale's investment officers controls the University's multi-billion dollar endowment. Through a standing committee, students have a voice in issues regarding the University's investments.

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