New Haven could become the second U.S. city to divest from companies that support the Sudanese government, pending the results of an investigation into the holdings of municipal pension funds, city officials and aldermen said Tuesday.
City Controller Mark Pietrosimone said New Haven’s investment managers are currently scouring the city’s two pension funds to determine whether any of the money in the funds is invested in companies that do business with Sudan. Pietrosimone said any decision on divestment would be under the jurisdiction of the board that oversees city pensions.
“We’ll relay the entire issue to the trustees, and … hopefully they’ll vote to instruct the investment consultant to carry out their wishes, which would be, let’s divest from these firms,” Pietrosimone said. “In the past, the trustees have always acted in a very socially responsible way, and I don’t see them doing anything differently.”
The Providence, R.I., city council announced last week that it had voted unanimously in favor of divestment, making it the first U.S. city to do so. Yale announced in February that it would not invest in seven companies working in Sudan, and a number of other universities and three states have made similar commitments.
Pietrosimone said Ward 1 Alderman Nick Shalek ’05 first brought up the issue of divesting from Sudan in a meeting with himself and the two chairs of the pension board. Shalek said conversations with students involved in Students Taking Action Now: Darfur, as well as his own work in the Yale Investments Office, made him aware of the potential for the city to reconsider any investments it may have in companies tied to Sudan.
“The real power in divestment is when you have multiple institutions piggybacking off each other so you make a powerful statement, and that statement is what’s most important,” Shalek said.
Shalek said the city is currently investigating whether it is invested in companies identified by the Lowenstein International Human Rights Clinic at Yale Law School as connected to Sudan. This is the same list of companies from which Yale announced it would divest its own endowment.
Catherine Sullivan-DeCarlo, Mayor John DeStefano Jr.’s spokeswoman, said the city is still considering Shalek’s suggestion of divesting from companies supporting Sudan. The mayor has not yet decided what action, if any, to take if the pension’s managers find that the city is invested in such companies, she said.
Pietrosimone said another group of New Haven citizens has also advocated divesting from companies involved with the production of nuclear weapons and that the pension board will have to carefully consider whether any divestment could adversely affect the two pension funds’ returns. He said he did not think that the city had enough invested in Sudan that divestment would strongly impact the pension’s performance.
“There’s only five or six firms, and I’m sure we don’t have a lot of money invested with these firms, so I don’t think it’s going to be anything that would affect the overall performance of the funds,” he said.
Board of Aldermen President Carl Goldfield said he had not yet heard about the move to investigate the city’s investments in Sudan and would have to learn more about the potential impact of divestment before deciding whether he would support the move.
“I support the principle — I think what’s going on in Sudan is horrible — but whether this is practical or would be meaningful, I would have to reserve judgment until I hear more about it,” he said.
Pietrosimone said the two funds whose investments are being looked into are the City Employees Retirement Fund and the Policemen & Firemen’s Pension Fund, whose market values are $182 and $280 million, respectively.
Lauren Jacobson ’08, co-director of STAND, said the group is also pursuing a bill now in the state’s legislature that would divest Connecticut’s holdings in companies working in Sudan. The bill, which was sponsored by state Sen. Martin Looney, the Democratic majority leader, was voted out of committee and is now waiting to be debated and voted on by the full House.