Stanford Management Company manages the nation’s fourth-largest university endowment with $36.5 billion. A “divestiture statement” calling for Stanford to divest from Chevron, Lockheed Martin, and other companies involved in Israel’s military operations in Gaza was recently passed in Stanford’s 2024 ASSU election. This bill, coupled with Stanford University’s campaign to divest from the fossil fuel industry, highlights that our endowment investments are under greater scrutiny than ever before.
Questions regarding the ethics and responsibility of the University’s investments are handled by the Board of Trustees’ Special Committee on Investment Responsibility (SCIR), which leads Stanford University’s investment decisions. There are currently no student members on this committee.
We believe that the participation of student representatives has been needed for a long time, regardless of the current movement. The Board of Governors has 11 committees that provide recommendations and advice to the Board on various aspects of the University’s operations. Currently, two student representatives serve as “full voting members” on four of her committees: Development, Finance, Land and Buildings, Students, Alumni, and External Affairs. Student members of the Finance Committee already oversee financial issues similar to those handled by SCIR.
We urge the Board of Trustees to implement two student seats in SCIR to formally involve students in discussions and decision-making about Stanford’s endowment.
Student Representative Litigation in SCIR
Students will provide a different perspective than currently sitting stakeholders on how institutional responsibility should motivate investment decisions. Involving student members on committees fosters a more direct and effective expression of student opinion diversity and conviction, and eliminates the type of bureaucracy that isolates decision-makers from our voices. Bureaucracy will be eliminated. Student members can serve as spokespeople who listen, summarize, and report student concerns, rather than leaving the board to make assumptions about campus sentiment.
Our advocacy for student input is separate from the claims and advocacy of any particular activist. Rather, it is rooted in the need for an active and formal student partnership with the governing board. our University institutional holdings.
Stanford’s investment portfolio, a “merged pool” managed by Stanford Management Company, is money invested in the name of education. Many current students will become alumni and contribute endowments that will be managed as part of this portfolio. Investment committee representatives will foster economic partnerships between Stanford University and future graduates from the earliest stages. It also increases trust and transparency between current students and administrators.
With these benefits in mind, why are students not already represented on the Select Committee on Investment Responsibility?
If Stanford’s top leaders believe that students do not have enough experience or knowledge about finance and investing, this contradicts the fact that students are already represented on the finance committee. Additionally, students as a whole can trust that their university will finance their education.
If Stanford does not want to disclose investments to members of its student body, we do not believe this is sufficient reason to exclude student representatives. Stanford students already work as summer analysts at Stanford Management Company.
If Stanford believes that students cannot put the interests of the university before pursuing personal politics, then perhaps they should have had students serve on similarly important presidential search committees in the first place. Maybe I shouldn’t have trusted him to serve.
A brief history of student-driven investment decisions at Stanford
Stanford students have long demonstrated a desire to discuss and correct the institution’s findings. In 1985, the student body voted 2,045 to 485 that Stanford University should divest from Motorola because of its sale to the South African military and law enforcement agencies. Stanford University’s Board of Trustees agreed with the students’ recommendation and pledged to sell approximately $4.7 million worth of Motorola stock if Motorola continued to operate with the administration. This resulted in Motorola selling all of its manufacturing operations in South Africa.
In 2005, the Stanford chapter of Students in Action Now: Darfur (STAND) urged Stanford to divest from four companies whose operations supported the Sudanese regime that perpetuated genocide in Darfur.
In 2014, the Board of Trustees announced that Stanford’s endowment would stop funding coal mining companies, making Stanford the first major university in the United States to take such a step. The president at the time said that Fossil Free Stanford University, the student coalition behind much of the advocacy at the time, “facilitated important discussions” about university investments.
In all these cases, the board ended up modifying the institution’s holdings from the student’s perspective. The time has come to institutionalize student-board partnerships. The formal addition of students to the Investment Responsibility Committee will bring stability to the confusion that exists on all sides of the difficult investment debate.
table seat
Since the Board adopted the Statement on Responsible and Ethical Investing in 2018, the school has received strong support from students seeking divestment, including an ASSU ballot initiative and petitions to faculty and the Board of Trustees. I’ve seen it with my own eyes.
To be clear, we are not advocating that only students should drive Stanford’s portfolio. Rather, we are simply asking students to be respected enough to have a seat at the table when discussing whether their endowments are used in accordance with the values ​​Stanford stands for. According to the commission’s values ​​statement, this includes “environmental, social and governance factors”.
We propose that students should have two seats (one undergraduate and one graduate student) on the Special Committee on Investment Responsibility. This selection process is rigorous and credential-based and should begin as soon as possible.
The ideal candidate for the committee will have an extensive background in finance and investments, the ability to communicate the diverse interests and needs of our student body, and, most importantly, the shared values ​​that our community embodies. A person with demonstrable abilities.
If the University commits to increasing this transparency, the Board of Governors can gain valuable insight into student perspectives, and students can gain much-needed involvement in important decisions related to Stanford’s institutional holdings. I can. Coordinated investment is difficult. Strengthening accountability can only help.
