Students oversee investing

By Kevin Lin     2/18/10 6:00pm

While Rice is reforming the budget to meet the fiscal limit imposed by the current economic climate, Rice students are reforming the social impact of Rice's endowments. A group of students from Rice for Peace and Justice have come together to create the Committee on Investor Responsibility Policy, which focuses on the social and environmental impacts of Rice's investments. Richard Treadwell, co-founder of the committee, said that the committee was started to look at the social impact of Rice's investments.

"The aim of the committee is to make sure that Rice's endowments are invested as responsibly as possible," Treadwell, a Baker College senior, said.

The committee will consist of three faculty members chosen by the Faculty Senate, two graduate students chosen by the Graduate Student Association, three undergraduate students chosen by the Student Association and one administrator chosen by President David Leebron. All offices will need to be confirmed by the president and will be up for renewal on a yearly basis, Treadwell said.

---

---

Treadwell said that he and fellow co-founder Gislaine Williams (Jones '09) came up with the idea in spring 2009 when they were co-presidents of Rice for Peace and Justice. Treadwell said they both thought taking a closer look at Rice's investments was important.

Because Rice is a private university, its investments are not made public. This is done to keep a competitive edge over other private college endowments, Treadwell said.

Elizabeth Long, the club's faculty sponsor, pointed Treadwell to the Responsible Endowment Coalition, a group that promotes responsible investing in the colleges, Treadwell said. Through this committee, Treadwell and his team learned that 14 of the top 20 schools have a committee that focuses on the social implications of its investments.

Harvard University has had such a committee since the 1970s, Treadwell said. Another notable example is Swarthmore College.

"Lockheed Martin wasn't respecting the rights of its gay and lesbian employees," Treadwell said. "The committee at Swarthmore took it upon themselves to do something about it and they filed a shareholder resolution and then suddenly Lockheed Martin just magically put a clause in its charter protecting its gay and lesbian employees."

Treadwell and Williams, along with other Rice for Peace and Justice Members, made their case through a series of meetings with the administration where they made their proposals and presented a viable plan.

"We expected a lot of resistance from the administration," Treadwell said. "We essentially asked the investment office for a meeting. We were prepared to talk to the Thresher and the Houston Chronicle. We had our bases covered when we walked in the door."

Leebron officially approved the Committee on Investor Responsibility Jan. 29, with agreement from both the Rice Board of Trustees and the Rice Management Company. The Rice Management Company is a third-party organization that manages Rice's investments.

Vice President for Investments and Treasurer Scott Wise said he thought the committee could play an educational and informational role.

"What I would expect is that the advice and recommendations that come from the committee will be part of the information-gathering process for the Rice Management Company that we use to make informed decisions," he said.

Currently, the only power the Committee on Investor Responsibility Policy holds is to make recommendations on the proxy votes, Treadwell said. These recommendations do not have any contractual obligations but will be taken on in good faith.

"The proxy votes were our foot in the investor responsibility door," Treadwell said. "This year, the committee will focus exclusively on proxy votes."

While those on the committee will have knowledge of Rice investments, they will not be able to share this information with the general Rice community.

"That's why it's very important that we have people in there that are very passionate about social justice," Treadwell said. "They will not have the community to keep them accountable, so they will have to keep themselves accountable."

For the most part, the committee will be self-managed, Treadwell said. The committee plans to meet every week during the proxy-voting season in spring. During the fall semester, the committee will meet bi-weekly or once a month.

The recommendation made by the committee will comprise a short statement on the issue and voting preference.

"We're looking for people that are aware of the evils that corporations are engaging in, that have an inclination to social justice and that feel they can do something about it," Treadwell said. "They have to be aware of the tension between economic and social goals but in the end the social inclination should be more prevalent."

Treadwell said he has been working with SA President Patrick McAnaney to get students to apply.

McAnaney described his role in the process as that of a facilitator, and the SA's role in the affair to be minimal. McAnaney helped set up meetings for dialogue to take place during the formation of the Committee on Investor Responsibility Policy. He described the SA's job as submitting a list of four to six students out of the pool of applicants whose names were forwarded to Leebron.

"I think this is a really incredible opportunity," McAnaney said. "I'm really happy that the university has chosen to adopt this policy. I feel it's really important for us as an institution and as a community to know the impact of our endowment and how we can be a force in this world through our financial influence."

Such a goal is what Treadwell and his team have been aiming for all along.

"Universities across the country have a collective $400 billion in endowments." Treadwell said. "That's a substantial portion of the economy, so this is really about getting that investment capital under another bottom line: the social bottom line.

---