2008 Woodie Awards
Socially Responsible Investment is here to stay
JESSICA EARLY '09
Issue date: 3/16/06 Section: Opinions
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At a rapidly increasing number of colleges across the country, students are organizing in a growing movement to question the practices behind the investment of their schools' multi-million-dollar endowments. Guided by social, ethical and environmental concerns, they see to monitor their colleges' investment portfolios in an effort to ensure that those practices abide by greater standards of corporate responsibility, while positively contributing to the local, national and global economy.
These students are rallying behind the call for Socially Responsible Investment (SRI), a process by which investors (including colleges) generate positive social capital by selectively investing in or divesting from, companies and funds. Based on guidelines determined by members of an investment community - from students all the way to administrators - and the shareholders of the companies in question.
This type of investment gained special prominence during the 1980s when many institutions of higher education moved to divest from corporations with business interests profiting from the apartheid regime of South Africa. Middlebury College was invested in South Africa, and was one school to engage in divestment of such holdings after students and faculty protested together to demand change.
SRI has proven instrumental not only as a force in positive social change, but has also been tremendously effective economically, sparking increased economic interest in investor and investee, and brought equal or greater returns for the investment community. Engaging in a policy of SRI does not mean incurring an economic loss-no money is being given away and the goal is still to maintain high returns on the invested capital. The difference between SRI and traditional investing is that the increase in our endowment does not come at the cost of social injustice and environmental harm; instead-it flourishes through ties to creative, hardworking, socially responsible entrepreneurs who benefit mutually from our investment in them.
These students are rallying behind the call for Socially Responsible Investment (SRI), a process by which investors (including colleges) generate positive social capital by selectively investing in or divesting from, companies and funds. Based on guidelines determined by members of an investment community - from students all the way to administrators - and the shareholders of the companies in question.
This type of investment gained special prominence during the 1980s when many institutions of higher education moved to divest from corporations with business interests profiting from the apartheid regime of South Africa. Middlebury College was invested in South Africa, and was one school to engage in divestment of such holdings after students and faculty protested together to demand change.
SRI has proven instrumental not only as a force in positive social change, but has also been tremendously effective economically, sparking increased economic interest in investor and investee, and brought equal or greater returns for the investment community. Engaging in a policy of SRI does not mean incurring an economic loss-no money is being given away and the goal is still to maintain high returns on the invested capital. The difference between SRI and traditional investing is that the increase in our endowment does not come at the cost of social injustice and environmental harm; instead-it flourishes through ties to creative, hardworking, socially responsible entrepreneurs who benefit mutually from our investment in them.