GMC hosts Socially Responsible Investment forum

BY MELISSA MARKSTROM

“It’s interesting that GMC has an environmental mission, but not socially responsible investment,” said Todd Walker, founder of the Vermont chapter of Progressive Asset Management, and one of the speakers at the Socially Responsible Investment (SRI) Forum held at GMC in November.

“We don’t know where our money’s invested, so we can’t say we’re a green college,” said forum creator and GMC senior Rob Pudner. Pudner invited SRI experts from across Vermont to shed light on how GMC can responsibly invest its $2 million endowment. Inspired by an SRI conference he attended earlier in the semester and his independent study, SRI in Higher Education, Pudner is dedicated to weaving ethical responsibility into GMC’s endowment.

So, what is SRI? SRI is a movement to change the relationship between the investor and the companies they invest in to promote positive social change. It enables investors to build a portfolio guided by a particular set of ethics defined by the client. According to Pudner, GMC could use SRI to “align our actions with our ethics.” For example, the college could refuse to invest in companies whose practices aren’t conducive to GMC’s environmental mission. As shareholders, GMC could vote on proxies to shape company practices. In selecting where to put its money, the college could also use a portion of its endowment to invest in local businesses.

At the forum, speakers listed accomplishments made by colleges through SRI. According to Walker, Swarthmore College in Pennsylvania used SRI to convince Lockheed Martin and FedEx to give domestic partnership benefits to their employees. The Massachusetts Institute of Technology uses part of it’s endowment to fund entrepreneurial graduates. Speaker Rick Hausman said students at Stanford and the University of California, Los Angeles used SRI to raise the consciousness of universities and governments around the globe about Darfur. Rick Hausman is the Research Director for Clean Yield Asset Management, a firm which builds portfolios based the client’s values to “actively promote positive social change.”

Critics of SRI say that the practice increases risk and could result in financial loss. Hausman said his clients were drawn to SRI to increase returns. “Through a variety of studies, experts find that environmental, societal, and governmental factors can definitely affect a company’s bottom line and its performance in the stock markets.” Investing in companies where women and men are on a level playing field is better for the bottom line, said Hausman. He said that statistically a company with women on the board performs better than a board made up exclusively of men.

One of the problems of having SRI at GMC is that, according to Pudner, Chief Financial Officer Joe Manning claims to not even know which companies GMC’s endowment is invested in. At the forum, Walker insisted that Manning may have misinformed Pudner and that Manning “must know what’s in the portfolio,” to which panelists agreed.

GMC’s endowment is currently managed by Key Bank. According to Pudner, Manning claims that he only knows the top five companies GMC invests in, but the administration refuses to release even that information to the college community. Regarding speculations that Exxon is one of the top five companies GMC invests in, Pudner said that “it is true that we have invested in Exxon… Joe Manning has the quarterly reports and each report shows the top five investments.” Pudner further claims he saw Exxon listed in one of the reports as one of the top five companies. Manning was contacted via phone, but didn’t return the call. “The most important person outside of the president and the provost is the chief financial officer,” said GMC professor and forum facilitator Jacob Park.

According to Hausman, Vermont is at the forefront of triple bottom line investing, a concept taught at GMC in which the bottom line is expanded to include people, profits, and the planet.

“This may be a new conversation for us at GMC, but conversations such as these have been happening in colleges across the nation,” said Pudner. “Two of the five Eco League schools participate in SRI. As a founding member, GMC should be a leader and not a follower.” He adds that college communities have the potential to make a real impact because colleges and universities nationwide manage $400 billion collectively.

Over fifty students, staff, faculty, administration and alumni attended the forum. Other speakers included Director of Development for the Vermont Community Loan Fund Jake Ide and GMC business professor Bill Prado.

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Posted by Melissa Markstrom on Dec 22, 2008 Filed under Green @ Green, Working. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry