Shareholding committee vetoes tobacco divestment

Issue to be reopened for discussion next fall

The Oberlin Committee on Shareholding Responsibility vetoed a resolution that the College sell all its shares of tobacco stock Monday.

Six Committee members voted in favor of divesting from tobacco stock and five voted against it. The resolution, however, needed a two-thirds majority of the 12-person committee to approve it in order for it to pass. Had it passed, the resolution would have been sent to the Board of Trustees for approval.

Committee members include Budget Director Robert Knight, Emeritus Professor of Sociology Al McQueen, Trustee George Bent, as well as senior Matt Borus and juniors Kim DeFeo and Anil Murjani. Faculty members of the math department also serve on the committee.

The resolution was drafted by several members of the Committee after they learned that motions to divest from tobacco had been passed at several other colleges and universities. Harvard, Haverford and Northwestern Universities were among those schools setting the divestment precedent.

The Committee's resolution proposed that the College would refrain from investing in or holding any stock in companies whose image was primarily associated with tobacco, or at least 25 percent of whose business was in tobacco, according to Borus.

If the divestment resolution were to be passed by the Committee, it would be sent to the Board of Trustees for approval.

The College currently holds stock in large tobacco companies such as Phillip Morris, according to Borus.

"I voted in favor of the resolution because I felt were Oberlin to divest from tobacco products, it would make a strong statement against the abuses of power tobacco corporations have shown. Through that divestment, we'd make a stronger statement than by other means," Borus said. "It would also set the precedent for Oberlin College to have a say in what it invests in."

DeFeo and Murjani, the two other student members of the Committee, also voted in favor of the resolution.

"I think Oberlin as a college has the responsibility to use its money in a responsible way. With my vote I was trying to encourage the College to do that. I see quite a lot of support for responsible investment emerging on campus," DeFeo said.

Many other student organizations on campus have expressed interest in promoting socially responsible investment.

The Oberlin Coalition for Peace approached Student Senate for several weeks in a row with proposals co-signed by many groups. They requested that Senate support them in their efforts to divest from military stock, although Senate did not pass the proposals on the grounds that they might not accurately reflect the feelings of the larger student body. Senators recently formed a task force to examine the issues more closely and garner student body reaction to the proposals.

Students on the Shareholding Committee met with some support and more opposition among the faculty and staff members of the Committee.

Knight voted against divesting from tobacco stock. "I feel the College has a better chance to exercise influence over companies as shareholders than it would by divesting completely," he said.

He explained that stock owners are allowed to vote by proxy on resolutions proposed by companies at their annual shareholder meetings.

Because Oberlin owns shares in tobacco companies, Knight said, the Committee was able to vote Monday on a proposed Phillip Morris resolution to apply U.S. smoking prevention programs to youth in developing countries. It also voted in favor of a resolution for the company to compile yearly reports to help control smuggling of American cigarettes into other countries.

Bent, OC '52, voted against the College's divestment resolution for similar reasons.

"If we're interested in trying to influence these companies, we have a much stronger voice by being a shareholder than by not being one," Bent said. "Shareholder resolutions can attract the attention of corporation management better than trying to communicate with them without being shareholders. I think it's incorrect to conclude that divestment is the best way to make a statement."

McQueen voted in favor of tobacco divestment. "The most important thing is that it's very clear now that tobacco and tobacco products are dangerous to people's health," he said. "In light of that, it seems that the most responsible thing the College can do is discourage the sale and protection of tobacco."

McQueen said divestment is also a valid method of protesting tobacco companies' marketing and production actions.

"The production strategy is to make tobacco more addictive. There are also marketing advertisements targeting portions of the population that are perceived as more vulnerable; namely, youth, children and women," McQueen said. "These are morally reprehensible actions and key issues as to why the College should take a very responsible stand in investment practices."

Although the College will not divest from tobacco stock this semester, Committee members said they expect the issue of divestment to resurface in the fall.

"In some ways I'm a bit disappointed this didn't pass, but I don't think the issue is dead at all; neither the tobacco issue nor the issue of responsible investing are finished," Borus said.

Knight said money in the Committee's budget has been set aside for a symposium on tobacco divestment and shareholding responsibility to take place in the fall.