Regents should show investment integrity

By Victor Weisberg and Rebecca Miller

Everybody knows that money talks. In our demand and supply world, money tells businesses what we want, what we value, and what we do not care about. So when we tell you that the UC Board of Regents in 2008 forfeited their votes as shareholders, allowing corporate managements to vote against resolutions that would have prevented sexual orientation discrimination, upheld human rights, moved our country toward energy independence, and encouraged sustainable business practices, we expect you to hear the damaging message this sent to the companies the University of California system is invested in.

Voting against such resolutions ““ recommendations made by shareholders concerned with company management ““ speaks loud and clear: Concern for people or the planet need not be considered.

The UC Regents continue, year after year, to remain disengaged from investment decisions when issues of fairness to people and the environment inevitably arise. In doing so, the UC is failing to align our investment practices with the principles we proudly uphold in the areas of research, teaching, and public service.

If the Regents believe that addressing social equity compromises returns, that environmental responsibility is not a part of business management, or that we as shareholders do not have an obligation to encourage corporate accountability, then their reasoning is severely misguided.

It is in fact their fiduciary responsibility to concern themselves with all of those elements. Staying detached from the decisions companies we invest in exposes our investments to long-term social and environmental risks, compromising future returns.

The ramifications of social and environmental insensitivity are material risks; take the downfall of companies like Russell Athletics, compromised by a lack of ethics for workers’ rights, or the degradation of lands, causing huge superfund liabilities and costing companies millions of dollars in pollution cleanup.

With UC money in companies like those and a status quo in which the regents refuse to vote for proactive measures, our investments stand to become unstable in the future.

This idea isn’t new; many highly respected investors, like BlackRock and UBS, and peer institutions, including Dartmouth College and Columbia University, have successfully implemented mechanisms like the U.N. Principles on Responsible Investing, and have seen positive effects.

The UC Regents will vote on Tuesday, on a proposal that would allow the UC Retirement Plan and General Endowment Pool, summing a total of over $55 billion dollars, to be managed with more resolute ethics, transparency, and responsibility to the world at large.

The effect of this would be monumental and global, and we strongly urge all UC community members to support this proposal by signing the petition at www.thepetitionsite.com/1/UC-Responsible-Investing and getting involved.

If the UC Regents can smartly address the concerns for risk management and consistent returns while upholding moral responsibilities as shareholders, then we stand to gain more stability for the UC’s current budget predicament.

That would be a decision to shout out that the power of UC money is to be invested with integrity and for the betterment of society.

For more information and to get involved with the UC Responsible Investment Coalition, contact Victor or Rebecca at [email protected].

Weisberg is a fourth-year environmental science student and works in the USAC President’s Office. Miller is a fourth-year anthropology student and chair of E3.