Investment dialogue crucial

To the Editors:

In light of President Dye’s invitation for student involvement in the College’s strategic planning effort, we found it necessary to also inquire about the investment of the school’s endowment.

On Nov. 23 we sent a letter to Ronald Watts, Oberlin’s acting Chief Investment Officer, to begin a dialogue about the ethical issues that are considered when investing our endowment. In order to enable all members of the College community to engage in that dialogue with informed opinions, we asked that a list of all investment managers that the College uses to manage our endowment be made public. In addition, we asked that the investment office release any information provided to it by the investment managers about the companies in which they invest, provided that the investment managers agree not to expel or sue the College for doing so.

This discussion is critical now when the world is in the midst of creating a global economy. The widespread vision of a worldwide free market pays no regard to its effects on people and communities around the world. If Oberlin finds it necessary to engage in the global market in order to enrich its endowment, we must not do so at the expense of others.

There are three factors that motivate us to act at this time:

First, universities and colleges in general, and our College in particular, have become major financial players. In 2003, according to the National Association of Colleges and University Business Officers (NACUBO), there were 87 college endowments which exceeded $500 million. According to statistics provided at the Nov. 13 Strategic Planning meeting for student input, our school’s endowment is approximately $560 million. With this much capital to invest, our school’s investments can and sometimes do have profound effects on communities throughout the world.

Second, our College has invested a portion of IRS endowment with Farallon Capital Management, the world’s fourth largest hedge fund, which has been involved in some controversial investments that had negative social and environmental implications. For example, Farallon invested a college’s money in Baca Ranch in an attempt to sell the water from an aquifer below Colorado’s Great Sand Dunes National Monument and could have destroyed the unique ecosystem of the dunes. See www.unfarallon.info for more on this and other investments.

Third, colleges and universities provide a moral compass for all of society. Oberlin has a history of going against currents of injustice to pursue the ideals of equality and egalitarianism. Our College has the opportunity to show leadership in the area of ethical investing by beginning a dialogue with us, its stakeholders, about what kinds of investments are appropriate for our community. Colleges and universities including Yale, University of Pennsylvania, Stanford, Williams, University of Texas at Austin, Tufts, Columbia and Mills are currently involved in this dialogue with students. The issue of ethical investment of college endowments has shown itself to be important enough to pull together campuses from across the nation.

In the 1980s, College students took a lead in the campaign to divest from South Africa in an effort to end apartheid. In the 1990s, students fought to make sure that College clothing would no longer be made in sweatshops. Today, we fight to insure that our College’s investments do not harm other communities or the environment.

The anti-sweatshop movement and the South African divestment campaign were based on knowledge of the College’s activities. When the College’s investments are hidden from view, we cannot even begin to consider their impacts. There is no greater value at an American college than the free exchange of ideas. It is only when there is an open discussion on campus about ethical investing that we will, as a community of students and scholars, come to a consensus about how our endowment should be invested.

Unfortunately, hedge funds, such as Farallon in which our College is invested, are known for their secrecy. If a hedge fund is going to invest for our College, it must come to terms with the needs of our community, including the need for openness, as well as the need to increase the endowment.

Our College can and, we believe, must become a leader by engaging all members of our community in a discussion about how our college invests, and by providing us with the information necessary to make informed decisions.

We can show other colleges that it is possible to make money, build a college community and have a positive impact on the world through our investments.

–Steven Wong, College senior
–Jacob Rinaldi, College sophomore
–Meredith Dowling, College junior
–Whit Forrester, College sophomore
–Rebecca Tumposky, College junior
–Danielle Levine, College junior
The Oberlin College Recyclers
 
 

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