A UT student presented a resolution to the UT System Board of Regents on Thursday suggesting that they change the system investment policy, which the student said disregards the social and political impacts of its investments.
Mishal Al-Johar, a former geological sciences graduate student, made the proposal on behalf of the group Longhorns for Investing Responsibly. Six UT students authored the proposal. Student Government and the Graduate Student Assembly both passed resolutions recommending the policy change last year.
In the proposal, the group recommends the University of Texas Investment Management Company change its policy to “[consider] investments in line with its values.” The current policy states that the corporation cannot use its investments to “advance social or political purposes.”
UTIMCO, independent from any campus, is the nonprofit corporation created by the UT System in 1996 to oversee UT and Texas A&M systems’ investments. UT System Regent Paul Foster is the chair of UTIMCO’s board of directors, and UT System Chancellor Francisco Cigarroa is vice-chair for policy on the board.
Ben Snyder, a theater and dance graduate student, was instrumental in the creation of the responsible investment group. He said the sheer size of the bureaucracy surrounding UTIMCO makes changing the policy challenging, and UTIMCO’s investments have out-performed many other universities’.
“Maybe in these economic times, that’s all they want to focus on,” Snyder said. “But you are dealing with the money of a public institution here. We have a mission statement, and we need to adhere to that.”
Snyder, one of the proposal’s authors, said approaching the board with the suggestion was the most effective way to push for the change.
“We were hoping for one person on the board who thought this was a good idea and wanted to take this on,” Snyder said.
Student regent Kyle Kalkwarf, a fourth-year medical student at the UT Health Science Center at San Antonio, expressed interest in pursuing the issue, Snyder said. Al-Johar said by changing its investment policy, UTIMCO would follow the examples set by investment companies at other public and private universities, including those at Harvard University and Stanford University, which UTIMCO was modeled after.
“There are many major universities who have this policy and many investment groups who consider social responsibility,” Al-Johar said. “If UTIMCO is to follow a prudent investment standard, shouldn’t the UT System consider adopting the policies of our colleagues?”
In his presentation, Al-Johar said UTIMCO’s policy does not adhere to the standards set for the UT Board of Regents in the Texas constitution, which requires the regents to use available University funds to make reasonable investments that benefit the state’s flagships.
“It is our hope that the committee would be willing to discuss the proposal and discuss how we can move this forward,” Al-Johar said.
UTIMCO officials and system spokespeople did not respond to requests for comment as of press time Thursday.
In a May 2010 Daily Texan article, UTIMCO chief executive officer Bruce Zimmerman said the corporation should not use investments to make social and political statements.
“It is not UTIMCO’s position to make [ethical] judgments,” Zimmerman said. “The reason there is the bright line to not take in those considerations is that it’s a slippery slope. There is an endless list of potential social and political grievances. Whatever judgments we make would incur an economic cost, so we would be taking resources away from the University system, and that is not our role.”