Jesuit educators, known for their dual emphasis on academics and social justice, are gearing up to set a new standard for the way colleges wield clout on Wall Street.
Under a proposal rolled out for chief financial officers recently in Cincinnati, the nation’s 28 Jesuit colleges and universities would use their billions of dollars in investments to push a collective, Roman Catholic social agenda. Participating colleges would build endowment wealth and advocate for the poor simultaneously by demanding corporate policies that defend human rights, reduce predatory lending practices and prevent the spread of HIV/AIDS in Africa.
The endowments of the nation’s 28 Jesuit colleges and universities are valued at approximately $6.4 billion in aggregate.
At least one institution, the University of San Francisco, has already signed on. Several more are likely to follow suit, according to the Rev. Charles Currie, president of the Association of Jesuit Colleges and Universities. If that happens, and Jesuit schools begin to engage corporate America with one voice on social issues, a new model for bringing collegiate concerns to the private sector would be born.
“This really hasn’t happened before” among any group of colleges, says Mark Orlowski, executive director of the Responsible Endowments Institute in Great Barrington, Mass. “It would be a noteworthy event that all schools should look at.”
The nation’s 220 Roman Catholic colleges and universities aren’t necessarily apt to follow where their Jesuit brethren lead on the investment front, according to Michael James, vice president of the Association of Catholic Colleges and Universities. But higher education at large, he says, is sure to feel a pull in that direction if it proves an effective means for shaping corporate behavior worldwide. “It would be similar to if the Ivy League schools were to come together and announce they would be changing their financial aid policies,” James says. “That’s going to put some pressure on other institutions (to follow suit). It sets a standard.”
Though socially responsible investing among colleges dates to the 1970s, institutions have for the most part acted independently. Even when many universities adopted similar agendas, such as divesting from South Africa during apartheid or shunning tobacco stocks in the 1990s, colleges stopped short of forming national shareholder alliances.
In the new Jesuit initiative, each participating institution would continue to make investment choices internally, but efforts to shape corporate policies would occur through an alliance.
Cooperation has already happened on a smaller scale. For example, because two Jesuit provinces owned stock last year in Occidental Petroleum Corp., they were able to team up and help negotiate a corporate policy requiring human rights training for employees and human rights provisions in foreign contracts.
The heft of college endowments could surely enhance such efforts elsewhere, but only if administrators and trustees adopt a proactive stance, according to British Robinson, national director of social and international ministries with the U.S. Jesuit Conference, based in Washington. The approach, she says, relies on constructive rather than combative relationships with industry. “The old model is everybody leave South Africa because they’re bad people and they’re racist, right?” Robinson says. “But how much influence can you really have over a company if you walk away? My job is to get (Jesuit colleges and universities) to have an active social investment policy rather than a negative one or a sort of dormant one that doesn’t make any social impact.”
Currently, all the Jesuit colleges and universities have some measure of protocol in place to keep their investments in line with Catholic social teaching, Currie says. To expect that none would own stock in companies whose primary business involves abortion services or weapons manufacturing, for instance, is a safe bet in his view. But, he adds, getting every institution to sign on to this year’s specific, proactive agenda may be a challenging task.
“This is an important initiative, but it’s complex,” Currie says, noting that investing decisions at colleges and universities require input and consideration among a variety of constituencies. “Different folks are going to have different priorities. … There will be a positive response, though I don’t know from how many.”
Whether other non-Catholic colleges would follow a Jesuit model of alliance- based shareholder activism remains to be seen. Although Jesuits enjoy a common set of religious values that prove helpful when forging alliances, Orlowski sees all colleges and universities as ethic-driven institutions that might consider alliances with likeminded schools, especially if the Jesuit example reaps results both socially and financially.
