Carnation Co.--A Poor Investment
WHEN PRESIDENT BOK in 1978 rejected total University divestiture from companies operating in South Africa, he did leave open the chance that Harvard might sell its shares in a firm that "has failed to adhere to reasonable ethical standards" in the apartheid state. For four years this opportunity has gone unrealized, but last week brought the welcome news that the Advisory Committee on Shareholder Responsibility (ACSR) had for the first time in its history recommended selected divestiture from a company violating widely accepted standards of behavior in South Africa.
The Carnation Co.--in which Harvard owns more than 56 million, according to the latest financial report--has neglected to meet the basic requirements of the Sullivan Principles, a set of equal employment and labor practice guidelines for U.S. firms operating in South Africa. And furthermore, the company has failed to respond adequately to repeated queries by the ACSR--which advises the Corporation on investment ethics about why it has not complied with the standards. Given these factors, in the words of one committee member, there is no reason for Harvard to remain holding Carnation stock.
As a number of anti-apartheid activists have pointed out, the principles themselves are only minimum guarantees. Exiled South African poet Dennis Brutus calls them "a figleaf to cover up the obscenity of the Corporations" working in South Africa. We agree with Brutus and others like him. So what if IBM treats its 200 Black employees nicely when its computers help the illegitimate South African government maintain its systematic repression of millions of others?
BUT THE PEOPLE who run this University are intent on maintaining investments in companies in South Africa. The least they should be expected to do is make sure companies are abiding by these most minimal of guidelines, which, by the way, resemble the principles set forth in Bok's open letter in 1978 on South Africa.
To do otherwise makes a mockery of the Corporation's stated belief that U.S. firms can set an example "of progressive labor and social policies" in the country. We therefore urge the Corporation to act quickly and favorably upon the ACSR's recommendation to divest from Carnation, which has clearly shown no interest in acting ethically in South Africa.
The ACSR, though, deserves credit for essentially expanding its own role beyond merely advising the Corporation on shareholder resolutions; it should continue to play an active role in focusing attention on the University's responsibility to invest ethically.
Student protestors, too, deserve credit for pressuring the ACSR into taking the stronger stands it has on Harvard's links to the apartheid-ruled nation. With the ACSR and, hopefully, increased student activism, next year further progress can be made in getting the University to disassociate itself with the murderous and repugnant government of South Africa.