THE ETHICAL INVESTOR

To the Editors of the Crimson:

On the basis of a prolonged study of the moral dimensions of university investments, culminating in the publication of a recent book. "The Ethical Investor--Universities and Corporate Responsibility," I and my co-authors reached certain conclusions pertinent to the Harvard-Gulf controversy.

We began with the proposition that individuals and institutions discharge their moral responsibilities not by avoiding contamination or controversy (for that is, in any event, a futile quest), but by seeking effective means of reducing the social harm we inflict on one another. Divestitute of corporate stocks, we found, does not advance this goal. It is not likely to change a company's behavior. Indeed, a day or so after the sale has taken place, (a) the price of the stock--management's major concern--is back to normal (the historical evidence makes this quite clear): (b) a few alert investors have enjoyed a windfall by buying the stock at a temporarily reduced price: and (c) the company's management has been freed from the constant pressure that could have been applied by a morally-concerned shareholder.

Accordingly, we conclude that the socially responsible course for a university investor was not to sell out for social reasons, but to deploy the rights and powers of a shareholder to correct injurious corporate policies. Harvard's decision in the case of Gulf is fully consistent with this recommendation.

Moreover, Harvard has committed itself to a more active shareholder role in a corporate social controversy than any other university of which I am aware. Some universities have ignored these ethical questions altogether, on "academic neutrality" grounds: others have voted for one or two shareholder propositions at annual meetings or have announced a general policy of shareholder involvement in social questions: but no university, other than Harvard, has committed itself, on an active and continuing basis, to investigate and attempt to correct the oppressive or other harmful practices of a specific company in which that university holds shares. John G. Simon   Yale Law School