A new policy on university divestment has already earned critics, as the administration commits to working with students, staff, faculty, and alumni to overhaul investment ethics procedures.
Decision-making power and the role of proxy voting are among critics’ foremost complaints with the new policy. The University of Toronto currently signs its voting power over to investment firms in its employ. A responsible investment movement wants the university to start using its voting power to avoid socially and environmentally damaging investments.
“At the moment we are very passive with proxy voting. We don’t really vote against management. We’ve seen the policy records,” said Thomas Felix, cochair of the Responsible Investment Committee. RIC, a campus coalition whose members include the Canadian Union of Public Employees, UTSU, and the Arts and Sciences Students Union, presented an alternative to the adopted policy, which was ultimately not discussed by Governing Council’s University Affairs Board.
Felix added that ethically secure investments could be more financially stable in the long run, avoiding such pitfalls as lawsuits and other losses caused by social upheaval. “We were disappointed to find that we didn’t take more active ways to protect our own interest, especially through further environmental and social standards that could help in the long term,” he said.
RIC’s proposed policy called for a permanent board of advisors who would issue recommendations on controversial investment decisions. The policy approved by UAB only defines how the university will get rid of unethical stocks, with no process in place to avoid acquiring them in the first place.
“The proposed policy is a more proactive approach to responsible investment,” said Felix. While the university’s policy gives a protocol for getting rid of ethically questionable investments, the draft calls for screening investments before making them.
Critics also expressed concern that the new policy removes elected representatives of the university community from the advisory committee. “We’re not convinced that [a representative system] is necessary, but we’re not opposed to having it,” said Catherine Riggall, VP business affairs. The approved policy is an update of one brought before the UAB in November 2007, which was rejected over concerns that it would strip Governing Council of their authority in stock decisions.
The new policy addressed these concerns with a requirement that the ad hoc committee be approved by GC. Felix said he was confident that RIC’s suggestions would be taken into account in future meetings with administrators.
“I don’t believe that just because this passed, this is the end. Clearly the administration has shown that they want to work with us, and that they just want to get a procedural issue off the ground,” said Felix.
