Universities generate most of their super-sized endowments from two sources: investment returns and contributions from wealthy individuals and foundations.
Avoiding ‘Harm’
Notre Dame in Indiana, with $11.8 billion under management, said it adheres to guidelines from the U.S. Conference of Catholic Bishops, which asks members to avoid companies that “do harm.” The conference stops short of formal restrictions. The university declined to say whether it holds firearms investments, citing a policy of not commenting on its investments. Among the endowment’s largest donors, the Bill & Melinda Gates Foundation declined to comment.
Some college endowments are prohibited from social activism. The University of Texas Investment Management Company, which oversees $40 billion, is governed by a policy banning investments that would “advance social or political purposes.” Its endowment office declined to say whether it holds gun-related investments.
Divestment campaigns at colleges began in the 1970s, when students demanded their schools stop investing in companies that traded or had operations in Apartheid South Africa. By 1988, 155 educational institutions had severed investment ties, pressured by protests that gripped campuses at Harvard, Columbia, Michigan State and many others.
Fossil fuels are not the only business concern to spark college student activism in the last year. Students at Harvard, Yale and Cornell are now pressuring their endowment offices to shed holdings in Baupost, a hedge fund and one of the largest holders of Puerto Rico bonds. Protesters claim the debt burden is hindering the island’s recovery from the devastation of Hurricane Maria.
This article was provided by Bloomberg News.