University Senate approves Darfur divestment
March 12, 2008
The Villanova University Senate announced the approval of the resolution regarding genocide in Darfur at its most recent meeting on Feb. 8. The resolution had passed unopposed at the Oct. 26, 2007 meeting of the Senate. The resolution contains multiple provisions, condemns the “atrocities committed in Darfur as a major humanitarian crisis in the world today” and directs the University Investment Committee to consider divestment from Darfur.
After the resolution passed unopposed, University President Rev. Peter Donohue, O.S.A., forwarded it to the University Investment Committee for consideration.
The Investment Committee is chaired by Terence O’Toole, Class of ’80. It includes trustees, faculty, administrators and one student. They accepted the resolution unanimously.
Villanova University is a passive investor, so the Investment Committee does not directly select holdings. Instead, the University contracts outside asset managers who may or may not keep separate accounts for University holdings. Ken Valosky, vice president of finance and administration, represents the University administration on the committee.
“As directed by the Investment Committee, I sent a letter to all of our investment managers and provided them with the University Senate’s resolution, encouraging the managers to consider divestment of any holdings subject to guidelines from the Sudan Divestment Task Force,” Valosky said.
SDTF is part of the Genocide Intervention Network, a 501(c)(3) non-profit organization dedicated to stopping genocide worldwide. SDTF supports Sudan divestment campaigns at the university, city, state, national and asset manager levels.
As part of its work, SDTF maintains an online database of firms, developed in consultation with foreign policy experts, asset managers, third-party research firms and other institutions.
“I recently received a message from one of our managers saying they noted one security flagged by SDTF and that they would continue to monitor the SDTF guidelines with regard to that holding,” Valosky said.
Divestment is a last-resort option in the SDTF model of targeted divestment. The policy aims to maximize impact on the government of Sudan while minimizing harms to both Sudanese citizens and to portfolio returns.
In the scenario that a university does select its own assets, the first step is active engagement with firms to put pressure on the Sudan government to end the genocide. Most universities remain passive investors, however, and must work through asset managers to pressure firms.
“Annually I provide our asset managers with the U.S. Conference of Catholic Bishops’ Guidelines on Socially Responsible Investment and will now also provide the information on divestment in Sudan,” Valosky said. “We are one of the few Catholic universities that share the USCCB guidelines with its managers.”
The USCCB guidelines on Socially Responsible Investment are provided to asset managers as part of another University Senate resolution passed unanimously in October of 2006.
“[Socially Responsible Investment] is a complicated issue, but I find it rewarding and satisfying that investment managers can now look at Villanova University and say that we do stand for something,” Valosky said.
“At the end of the day, it’s a balance,” he said. “The trustees and myself have a responsibility to ensure the endowment returns as much money as possible to support the educational mission here at the University, but the dialogue is important.”
The Socially Responsible Investment and Darfur resolutions originated in the University Senate’s Mission and Social Justice Committee, currently chaired by Dr. Jonathan Doh, associate professor of management and director of the Center for Global Leadership.
“A predecessor of mine described MSJC as ‘The Conscience of the University,’ ” Doh said. “I like to remind myself of that description when the committee considers whether to take up a particular matter.”
In the past the MSJC concerned itself primarily with issues in and around the University campus, such as parking fees, public transportation initiatives and family leave benefits.
“More recently, the MSJC has turned its attention to broader concerns and the role of the University in global as well as local communities,” Doh said.
Socially responsible investment was first presented in-depth to the University Senate at its September 2006 meeting by Doh.
“Since 1995, SRI assets have grown 40 percent faster than all professionally managed investment assets in the U.S.,” Doh told the Senate.
At that time, Doh noted that the then University Investment Policy, adopted in 1989, was insufficient in light of increasing concerns about corporate responsibility and the role of investment funds in shaping and influence good corporate citizenship.
The Investment Policy that had been adopted by the University Board of Trustees in December of 1989 said, “No investment should be made in an enterprise which significantly supports or might reasonably appear to support social or economic justice.”
Doh and the MSJC – working with student groups, university administration, faculty and others – initiated a review that led to the SRI and Darfur resolutions.
“Ken Valosky, Jonathan Doh and Sally Scholz were all instrumental in getting the resolution approved,” VSB graduate student Scott Williams said.
Before graduating in May 2006, Williams served as president of Villanova’s chapter of Students Taking Action Now: Darfur. From that time on, he has worked to pass the Darfur Resolution.
“What we’re doing now is jumping into a much larger movement with a lot of momentum moving forward,” Williams said.