MINNEAPOLIS – On college campuses across the country, the rallying cry of pro-Palestine protesters has been “Disclose, Divest! We will not stop, we will not rest.”
Now, some are winning the first of those two demands: promises to provide information about how much university endowment money is invested in companies that profit from the war between Israel and Hamas.
As part of that effort, the University of Minnesota, for example, revealed this week that about $5 million of its $2.27 billion in endowment investments – or less than a quarter of 1% – are tied to companies Israelis or US defense contractors.
For Ali Abu, a 19-year-old University of Minnesota student and member of Students for Justice in Palestine, the disclosure is a first step in what he described as “just the beginning of our fight.” The ultimate goal, he said, remains divestment. A meeting with the university’s Board of Regents is scheduled for Friday.
But Jewish leaders have raised concerns, and endowments experts say the potential consequences of the disclosure are difficult to predict. Transparency, they say, has pros and cons.
“I think the broader trend toward transparency is probably healthy. In response to a very tense situation, I think people get nervous about that. Once the information is there, what do you do with it?” said Kevin Maloney, a former investment manager who is now chairman of the finance department at Bryant University in Rhode Island.
Donations face little federal regulation compared to other fundraising institutions. And there have long been calls for more transparency.
Maloney said portfolio managers can simply say they don’t want to worry about all the attention.
University endowments have increasingly been the target of disinvestment by activists.
Over the past decade, students have pressured universities to cut financial ties with fossil fuel producers, weapons manufacturers, tobacco companies and prison companies. This has often been done in conjunction with students in the Boycott, Divestment and Sanctions movement, which seeks to cut ties with Israel and the companies that support it.
Most colleges stood firm, saying their investments provide financial aid to future generations and should be protected from politics.
Neal Stoughton, a finance professor at the University of Waterloo in Canada, said colleges are wary of releasing information because they don’t want competition from other universities or institutions. He compared this to billionaires’ reticence to share investment tips.
“These kinds of people don’t tell you exactly where all their money is,” said Stoughton, former director of the Center for Endowment Research at the Vienna University of Economics and Business in Austria. He is currently doing research and consulting at the University of Arizona.
At the University of Michigan, officials responded to recent calls for divestment by stating that the decades-old institution’s policy “is to protect the endowment from political pressure and base our investment decisions solely on financial factors, such as risk and return.”
Michigan policy allows for exceptions — it divested from tobacco companies and apartheid-era South Africa — but the bar “was intentionally set extremely high.”
The authorities only revealed that there are no direct investments with Israeli companies and that indirect investments through funds amount to less than 15 million dollars, a small fraction of the university’s 18 billion dollar endowment.
Universities also cite the complexities surrounding divestment. A large part of donations is often kept in investment funds that pool a large number of assets. It can be difficult to track exactly where the money goes, and universities often can’t choose between a fund’s investments.
Other schools that have taken the disclosure route include Northwestern University, outside Chicago, which said in an agreement posted on its website last week that it will respond to questions from any internal interested party about participation.
The University of California, Riverside also said it would begin publishing information online with the goal of “fully disclosing the list of portfolio companies and the size of investments.”
And in New York state, Vassar College promised “greater transparency about key independent contractors” as well as a review of a proposed divestment of defense-related investments.
At the University of Minnesota, the decision to provide more details about the endowment came as part of an agreement to end the encampment of protesters on the Minneapolis campus. The cries in recent weeks have included “Not one more cent, not one more cent. Enough money for Israel’s crimes.”
Tye Gregory, CEO of the Jewish Community Relations Council, said the disclosure will only lead to calls for divestment and risks harming Jewish students without actually changing the course of the fighting in Gaza.
“In my experience, unless you give in to all their demands, they will not give in to the administration,” he said. “And the administrations are not in a position to give in to all their demands. So my advice – not that they will accept it – is just don’t negotiate it. You won’t make them happy.”
Abu, who is one of the protest leaders, said students plan to demand full disclosure of all investments at Friday’s regents meeting, in addition to the $5 million that university leaders have already provided details about.
The information provided by the school names different companies in which the university participates through investments or funds. The list includes defense contractor Honeywell, which protesters have highlighted during rallies. Honeywell did not immediately return an email message from The Associated Press seeking comment.
The goal, Abu said, is “to target every arms company the university invests in, and every stock or contract and bond in countries that are complicit in war crimes.”
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Hollingsworth reported from Mission, Kansas. Collin Binkley in Washington, D.C., contributed.
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