MINNEAPOLIS– On college campuses across the country, a rallying cry from pro-Palestinian protesters is: “Reveal, divest! We will not stop, we will not rest.”
Now some are winning the first of these two demands: promises to provide information about how much university endowment money is invested in companies that profit from the war between Israel and Hamas.
As part of that effort, the University of Minnesota announced this week that about $5 million of its $2.27 billion in endowment investments — or less than a quarter of 1% — is tied to Israeli companies or U.S. defense contractors.
For Ali Abu, a 19-year-old student at the University of Minnesota and member of Students for Justice in Palestine, the revelation is a first step in what he described as “just the beginning of our struggle.” According to him, the ultimate goal remains disinvestment. A meeting with the university’s Board of Regents is scheduled for Friday.
But Jewish leaders have expressed concerns, and donation experts say the potential consequences of disclosure are difficult to predict. Transparency, they say, has pros and cons.
“I think the broader trend toward transparency is probably healthy. In response to a very charged situation, I think it makes people nervous. Once the information is there, what is done with that information?” said Kevin Maloney, a former investment manager who is now chairman of the finance department at Bryant University in Rhode Island.
Endowments have little to do with federal regulations compared to other fundraising institutions. And there have been calls for more transparency for some time.
Maloney said portfolio managers might say they don’t want to deal with all that attention.
University funds are increasingly the target of divestments by activists.
Over the past decade, students have pushed universities to cut financial ties with fossil fuel producers, weapons manufacturers, tobacco companies and prison companies. This is often done in collaboration with students from the Boycott, Divestment and Sanctions movement, which wants to cut ties with Israel and companies that support the country.
Most colleges have stood their ground, saying their investments provide financial support for future generations and should be protected from politics.
Neal Stoughton, a professor of finance at the University of Waterloo in Canada, said colleges are reluctant to release information because they don’t want competition from other universities or institutions. He compared it to the reluctance of billionaires to share investing tips.
“These types of people don’t tell you exactly where all their money is,” says Stoughton, former director of the Endowment Research Center at the Vienna University of Economics and Business in Austria. He currently conducts research and consulting at the University of Arizona.
At the University of Michigan, officials responded to recent calls for divestment by saying the institution’s decades-old policy “is to protect capital from political pressure and base our investment decisions solely on financial factors such as risk and return.”
Michigan’s policy allows for exceptions — it has divested itself of tobacco companies and apartheid-era South Africa — but the bar “is deliberately set extremely high.”
Officials announced only that there are no direct investments in Israeli companies and that indirect investments through funds amount to less than $15 million, a small portion of the $18 billion awarded by the university.
Universities also point to the complexity surrounding divestments. A large portion of donations are often held in investment funds that pool large numbers of assets. It can be difficult to track exactly where the money goes, and universities typically don’t get to pick and choose from a fund’s investments.
Other schools that have taken the disclosure route include Northwestern University outside Chicago, which said in an agreement posted on its website last week that it will answer questions from internal stakeholders about holdings.
The University of California, Riverside, also said it would begin posting information online with the goal of “full disclosure of the list of portfolio companies and the size of investments.”
And in New York State, Vassar College promised “greater transparency about large independent contractors,” as well as a review of a divestment proposal from defense-related investments.
At the University of Minnesota, the decision to provide more donation details came as part of a deal to end protesters’ encampment on the Minneapolis campus. Chants in recent weeks have included: “Not another nickel, not another dime. No more money for Israel’s crimes.”
Tye Gregory, CEO of the Jewish Community Relations Council, said disclosure will only lead to calls for divestment and risks harming Jewish students without actually changing the course of the fighting in Gaza.
“From my experience, unless you give in to all their demands, they will not give in to the government,” he said. “And governments are not in a position to give in to all their demands. So my advice – not that they will accept it – is not to negotiate that. You’re not going to make them happy.”
Abu, one of the protest leaders, said the students plan to demand full disclosure of all investments at Friday’s regents meeting, beyond just the $5 million that university leaders have already provided details about.
The information provided by the school mentions various companies in which the university has interests through investments or funds. The list includes defense contractor Honeywell, which protesters have singled out at rallies. Honeywell did not immediately return an email message from The Associated Press seeking comment.
The goal, Abu said, is to “attack all arms companies in which the university invests, and all stocks, contracts and bonds in countries complicit in war crimes.”
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Hollingsworth reported from Mission, Kansas. Collin Binkley of Washington, DC, contributed.