US under pressure to dump Sudan holdings

July 14, 2006

The best-organised student movement since the apartheid era has had mixed success in its bid to change university investments. Jon Marcus reports

Some 40 US universities have agreed to disinvest in companies that do business with the Government of Sudan after pressure from the best organised national movement of students since the apartheid era.

But the action taken differs vastly in scale between institutions and has not been without controversy.

Some of the schools have cut their ties completely, while others have agreed to consider the matter or to refrain solely from making future investments in companies that support Sudan's Government, which has been accused of genocide.

Harvard University, traditionally reluctant to use its vast endowment for social change, pulled a $4.3 million (£2.3 billion) investment in PetroChina, whose parent, China National Petroleum, is a partner of the Sudanese Government in oil production. But it simultaneously increased its investment in Sinopec, another Chinese oil company working in Sudan.

After more than 1,200 students, faculty and alumni signed a petition, Harvard subsequently said it would sell its $8.3 million investment in Sinopec, too.

Now the students want Harvard to drop its $5.1 million investment in the Russian oil company Tatneft. Amherst College, Stanford University and the University of California have already withdrawn.

The biggest victory for the student-led Sudan disinvestment campaign came when the regents of the University of California agreed to disinvest completely in nine companies that have involvement in business that provides revenue for the Sudanese Government.

Although completing the action would take up to 18 months, the vote "puts the university on the right side of history", said Adam Rosenthal, the California regent who introduced the measure.

The California system disinvested in companies doing business with South Africa in 1986 and with tobacco companies in 2001.

Other universities have taken varying approaches to the latest student campaign.

Amherst and Williams colleges have disinvested in two dozen companies apiece, the University of Pennsylvania in seven and Stanford and the University of Maryland in four each.

The University of Washington agreed in principal to disinvest but is still debating the issue. Princeton University is giving companies in which it holds investments a chance to withdraw from Sudan before deciding whether to disinvest in them. Yale University tried the same thing and ended up disinvesting in seven companies after receiving inadequate responses.

Despite the success of the movement in prompting universities to act, the effect of the disinvestment campaign is unclear and may be largely symbolic.

The trustees of Trinity College, for example, agreed to end direct investment in companies that have business ties to Sudan, even though the school has none.

Students at Trinity plan to press the university to pressure private fund managers through which it invests its endowment to ditch shares in Sudan-linked companies.

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