Letter to the Editor: Northwestern must “divest” from investment secrecy

Dick Reif

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The Daily recently reported that Northwestern is among three universities agreeing to sign the United Nations’ Principles for Responsible Investment to create transparency for endowment fund allocations. Great news. But NU will only reveal its investment process, not its specific investments or who makes those decisions. Grating news. This two-faced approach to transparency earns chief investment officer William McLean and his superiors a high-five for hypocrisy. That’s like posting the Fortune 500 list without naming any of the companies on it — a major sin of omission.

Fossil Free NU protested its frustration to the Board of Trustees. Their spokesperson, SESP junior Christina Cilento, said, “It seems like an evasion tactic to say we are committed to environmental sustainability but not actually enact these principles.’”

She’s correct. We don’t know if NU’s endowment officers invest in coal companies, either directly or indirectly, via various equity funds. Owning coal company shares shouldn’t be a dark secret.

Firearms are another target for divestment on many campuses. Does NU purchase shares in gun makers and dealers, directly or through other investment vehicles?  I raised this question after the Sandy Hook slaughter in 2012 and was told by a PR staffer that NU invests in equity and fixed income funds, not individual companies.

Fine. But which funds? Is one of them Cerberus Capital Management, a private equity predator that owns the Remington Outdoor Co., a conglomerate of gun manufacturers including Bushmaster, those wonderful folks who made Sandy Hook shooter Adam Lanza’s weapon of choice. Firearms stock shares turn dollars into death warrants.

Campus divestment movements also target the incarceration industry — private prison profiteers like The GEO Group, Inc., and the Corrections Corporation of America, who reap fortunes by exploiting the world’s largest prison population, more than 2 million inmates in U.S. “correctional” facilities. Does NU’s endowment fund invest in this literally captive market? We don’t know. But we should.

Student activists gave NU President Morty Schapiro a list of 19 demands. Add one more: Full disclosure of all endowment fund investments and those who make investment decisions. On his farewell broadcast of “The Daily Show,” Jon Stewart told viewers, “The best defense against bulls— is vigilance. If you smell something, say something.” NU’s “transparency” policy doesn’t pass the smell test. Speak up. Go get ’em, Wildcats.

Dick Reif, Medill ’64