Moral Money

When Chancellor Stephen Robert announced the Brown University Corporation’s decision to divest from Sudan to the crowd of students rallying on the steps of Faunce House in February 2006, he said investing in companies implicated in genocide was “contrary to every value…we hold dear.” As Professor of Economics Louis Putterman put it, Brown “shouldn’t try to earn the maximum return on the dollar without any consideration for the ethical consequences.” This idea — that universities should utilize business investments to effect change — is one that has hardly been limited to Brown. But in the last few decades, the University has occupied the frontlines of divestment. Throughout the years, debates have arisen on the strategy’s impact, value and targets. One unwavering aspect, however, is its status as a battleground for ideas and powerful tool in the arsenal of social activists. As both a concrete measure and a symbolic display, divestment has become not only a central point of student resistance, but also a matter of institutionalized commitment.

While Brown’s campus has most recently become embroiled in heated debate over divestment from fossil fuel companies, the University’s history of economic activism extends back to the era of South African apartheid. The 1980s marked an eruption of anti-apartheid protests across college campuses nationally, aimed at pushing American businesses, universities and government to withdraw all financial support from those complicit in South African segregation. As Brown carried an inflation-adjusted $75.9 million portfolio of South African-linked stock, the campus was a lightning rod for activist efforts. The action intensified in 1986, when the Brown Free Southern Africa Coalition (BFSAC) constructed a shantytown on the University’s Main Green. Students also made 10 mock graves to represent those who died fighting apartheid in South Africa in preparation for a Brown Corporation meeting on divestment. Notably, the university administration gave its blessing to the erection of the shantytown and its dismantlement a week later — a show of compromise absent in many demonstrations of activism, which often exhibit conflict between the student body and administration.

Friction was never far from the surface, however. Following a vote by the University to only divest in a “limited” sense from South Africa, four student activists from BFSAC began a hunger strike in Manning Chapel to protest. While they were supported by several hundred Brown students who held another mock funeral, the students were “disenrolled” by the University on their ninth day of fasting due to fears surrounding health and liability. This was not the only case where disciplinary action was taken, as 20 students from Students Against Apartheid were also placed on probation for disrupting a Corporation meeting in 1987.

In the end, the University’s disentanglement from South Africa was a slow, step-by-step process. Brown first offered optional pension funds to faculty that had no ties to companies in South Africa, as well as a limited plan for Brown’s divestment in February 1986, only arriving at full divestment by the end of the year. Brown was one of the few academic institutions to lead the charge against vast racial inequality through divestment from South Africa. For Brown, one of the anti-apartheid movement’s most enduring legacies may have been the establishment of the Advisory Committee on Corporate Responsibility in Investment Policies (ACCRIP). Comprised of students and faculty, its mission is to uphold the Corporation’s ethical and moral obligation to put Brown’s money where its mouth is. Since the original divestment movement, ACCRIP has issued three major recommendations to the administration on divestment — concerning Big Tobacco, Darfur and coal.

The decision by ACCRIP to divest from Big Tobacco in May 2003 was essentially uncontested. By the time Brown came around to the idea of divestiture, 84 percent of all “socially responsible” funds, including the World Bank, already screened for tobacco stocks. Furthermore, the negative health hazards of tobacco use were well-documented at the time: As the ACCRIP wryly pointed out in its recommendation to the Corporation, “Tobacco is the only legal substance which, when used as directed, causes death.” But the ACCRIP was fully aware that the recommendation was symbolic. Only 0.2 percent of the endowment portfolio directly managed by Brown was invested in tobacco-related stock, so the gesture neither had a discernible effect on endowment earnings nor was it especially damaging to the industry. Yet, in the context of the $1.5 billion worth of tobacco holdings that US institutions divested from, Brown’s decision was critical to influencing other universities to embrace the trend of tobacco divestiture.

The crisis in Darfur exemplifies the powerful impact of nationwide investment activism. Universities across the country divested from companies, including fourteen multinational firms in the energy and communications sectors, whose activities supported the Sudanese government’s genocide and its human rights violations in Darfur. As there was clear evidence that 60 to 80 percent of the Sudanese government’s oil revenues went towards military expenditure, divestiture directly hindered the state’s capacity to sustain the genocide. Brown students from the Darfur Action Network (DAN) helped spearhead this national movement, and because of their sustained efforts, on February 25, 2006 Brown became the fifth university in the country to divest from Sudan. As of 2008, 61 American colleges and universities had joined Brown in this endeavor.

Unlike tobacco, divestment had visible effects in Sudan. The Sudanese government spent close to $1 million campaigning against the movement through press releases and full-page advertisements in The New York Times. As a result of the movement, several major companies operating in Sudan left the country entirely — in short, the movement had brought concrete and tangible change. In the words of Scott Warren ‘09, a leading campus activist, “If 800 schools simultaneously taking action around the world for Darfur doesn’t inspire you, what the hell does?”

However, the post-Darfur divestment landscape has been less clear-cut. Recently, one of the most contentious divestment debates has centered on coal. Brown Divest Coal, a driving force behind the movement, serves to disseminate information about the drawbacks of using coal as an energy source through on-campus events. As of October 2013, their efforts resulted in over 3,600 Brown students, staff, faculty and alumni signing a petition that urged the Brown Corporation to divest money in the University’s endowment holdings from the 15 largest coal companies. After the dramatic increase of Divest Coal’s presence on campus, President Christina Paxson and the Brown Corporation were forced to respond to the group’s petition. The Corporation took up the issue in a closed-door meeting in October 2013, but ultimately decided not to divest from the coal companies in question. Many students were outraged by this decision, as evinced by Brown Daily Herald (BDH) polls indicating that around half the student population opposed the decision not to divest. Divest Coal contended that the Corporation’s vote was illegitimate because some corporation members with links to the coal industry had not recused themselves. Despite the setback, the group has committed to continue its push for divestment.

But while the anti-coal camp received considerable support, there was also a substantial group of dissenters who sided with the Corporation’s decision. Some of these students’ opinions hinged on concerns about the divestment of coal specifically; for example, the belief that coal has an important role to play in providing the world’s power, especially for developing countries that require cheap and plentiful sources of energy to lift millions of people out of poverty. The trepidation of others, however, was due to suspicions about divestment as a strategy.

These suspicions have long plagued this form of activism; a simple look at Brown’s history shows the resistance that divestment campaigns have always had to struggle against. In a BDH editorial concerning the movement to divest from Israel, Treavor Gleason ’07 voiced his skepticism, writing that he “never bought into the logic that having a few dollars invested in Blockbuster constituted a gross violation of human rights simply because they have a franchise open in Tel Aviv.” Gleason, like many students, believed that divestment calls are largely a matter of rhetoric and have little, if any, real effects, especially when Brown’s stock holdings are too insignificant to have any practical impact. As such, it is not worth the administrative and financial difficulties that come along with such initiatives.

At the moment, the status of divestment from fossil fuels is still uncertain. Though the Corporation’s decision has temporarily put a damper on Divest Coal, the embers of the movement still glow. If Brown’s recent history is anything to go by, however, what is beyond doubt is that divestment as a tool for activism is here to stay. Brown’s experience has shown that, even disregarding pragmatic concerns, socially and environmentally responsible investment is a tangible sign of recognition that the University’s impact extends far beyond College Hill, whether in the fight against an unjust oppressor, the struggle to end lung cancer or the condemnation of genocide.