Archives

Halliburton & Loyola: Controversy amid financial gains

Loyola University owns $588,906.50 in Halliburton – a company famed for no-bid contracts of oil well protection in the Iraq war and whose former CEO is current U.S. Vice President Dick Cheney.

The university’s stock portfolio was given to the Shareholder Advocacy Committee, and subsequently obtained by the Phoenix in September 2007, and includes information that the university has invested in other controversial corporations including Clear Channel, Wal-Mart and Dow Chemical as late as March 2007.

According to Ray Catania, chair of the SAC, Loyola President the Rev. Michael J. Garanzini and the board of directors created the committee about a year and a half ago. The committee’s creation was intended to increase transparency and “monitor LUC’s portfolio for ‘socially responsible’ investments,” according to the minutes of the Dec. 5, 2006, Staff Council meeting.

Loyola’s portfolio consists of the number and value of stocks the university invests in various corporations. The committee aims to research companies that oppose Jesuit values and employ proxy voters – voters separate from Loyola – to encourage corporations to follow socially responsible practices.

“The Shareholder Advocacy Committee is a fairly recent development that we put in place, and their role is to be the face of the university,” said Eric Jones, assistant treasurer and chief investment officer at Loyola. “So if we own something in our portfolio, and there’s an advocacy initiative to influence how that company conducts business then ideally the shareholder advocacy committee would be involved in some way.”

Jones explained that many institutions, such as Harvard University, Stanford University, Yale University and others, formed such groups, depending upon the organizations’ goals and corporate structure. Loyola currently invests in approximately 20 to 25 companies.

“This is the model that Loyola has adopted, and it’s in its first year of existence,” Jones said. “Sometimes we employ the same company in multiple different strategies in multiple different funds. Depending on the investment strategy and depending on its complexity it leads you to different structural characteristics in the investment.”

According to filings with the Internal Revenue Service, Loyola is registered as a not-for-profit public charity under Internal Revenue Code 501(c) (3).

“I think we’re run pretty much like a business, even though we are here at the end of the day to serve and to teach students, Catania said. “It is a business. We’re here to educate the students obviously, but we still want to control costs and increase revenue.”

Jones elaborated on the business nature of the university’s investments.

“All the decisions that we make to either buy or sell are made by professionals,” Jones said. “For all of the university’s investments, we employ external investments that would cover the university’s endowment, pension plan and operating funds.”

The money Loyola invests in stocks is roughly $400 million from the university’s endowment.

“The endowment fund is essentially a long-term pool of savings that we spend fractionally from year in and year out,” Jones said. “When a donor endows a gift, they give it to you to be invested in gratuity, and only the earnings can be spent. What happens is, you can’t spend the original gift; you can only spend the earnings. You spend essentially only what you can afford to spend.”

The committee consists of three staff, three faculty and three students.

Elaine Lehman, a member of the SAC and assistant director of Corporate & Foundation Relations at Loyola, expressed in an e-mail the value of transparency the SAC hopes to achieve.

“It’s really important for us to make decisions that are not soley [sic] ours and more of the Loyola communities,” Lehman said.

According to Jones, the stock portfolio has changed since March 2007; Jones denied the Phoenix access to a current copy of the university’s stock holdings.

“In general, we do not make this information broadly available [,] and we would like to allow the members of the Shareholder Advocacy Committee to perform their role on behalf of the [u]niversity,” Jones stated in an e-mail. “This information has been distributed periodically to the Shareholder Advocacy Committee.”

According to Catania, the stock portfolio has not changed.

“We’re not really into trading in and out of stocks,” Catania said.

Without agenda, this article contains descriptions of several companies listed in Loyola’s March 2007 stock portfolio, as well as alleged abuses connected to the companies. All dollar amounts are the shares’ equivalent value as of the companies’ Oct. 30, 2007, stock exchange closing price.

HALLIBURTON

Halliburton was awarded the first and only preferred work project, or no-bid contracts, in Iraq to protect oil wells by the U.S. government, according to Halliburton’s Web site. Loyola owns 15,050 shares in Halliburton, approximately .017 percent of the company’s total market value.

CLEAR CHANNEL

Clear Channel Communications Company owns more than 1,172 radio stations and 35 broadcasting stations, according to the Federal Communications Commission Web site. The corporation is criticized for establishing itself as a media monopoly, according to The New York Times. Loyola owns 7,375 shares in Clear Channel, the equivalent of $278,111.25, or .0014 percent of Clear Channel’s total market value.

WAL-MART

Loyola owns 5,040 shares in Wal-Mart, or $228,664.80, or .00012 percent of the company’s total market value. According to Wal-Mart’s 2007 Annual Report, the corporation earned $11.3 billion in net incomes in 2007.

According to Human Rights Watch, a non-governmental organization that researches and advocates human rights globally, none of the 1.3 million Wal-Mart employees are represented in a union. HRW claims Wal-Mart teaches managers “how to remain union free in the event union organizers choose your facility as their next target.”

Chinese contractors produce 70 percent of Wal-Mart’s goods. The contractors will not permit independent, unannounced inspections of its contractor’s facilities, and Wal-Mart will not reveal its contractors, according to Global Exchange, a non-governmental organization and advocacy group that promotes human rights and social, economic and environmental justice.

Critical human rights advocacy groups include Wal-Mart Watch, ACORN, Business Ethics International, Sierra Club, Wake-Up Wal-Mart, International Labor Rights Fund and United Students Against Sweatshops.

DOW CHEMICAL

Loyola owns 740 shares, or $32,930, approximately .000078 percent of the total market share, in the corporation Dow Chemical is considered one of the “most wanted” corporations by Global Exchange.

Dow produced Agent Orange, a chemical weapon employed in the Vietnam War criticized for damaging Vietnamese and U.S. veterans. In 1988, despite warnings that they would be used for chemical warfare, Dow sold pesticides to Saddam Hussein for $1.5 million.

In 2001, Dow acquired The Union Carbide Corporation. The UCC faces manslaughter charges from a 1984 chemical explosion at a pesticide in Bhopal, India, where thousands were gassed to death and more than 150,000 people were left severely disabled after a catastrophic chemical leak.

Dow produces chlorinated chemicals and burns and buries waste, including materials consisting of Agent Orange, in Midland, Mich., and Plymouth, New Zealand.

The Vietnam Dioxin Collective, International Campaign for Justice in Bhopal, Students for Bhopal, Amnesty International-USA, Greenpeace International and Beyond Pesticides are some human rights advocacy groups.

CHEVRON

Loyola owns 12,165 shares in Chevron, or $1,095,823.20, approximately .0005 percent of the company’s total market value. Chevron is considered another of the “most wanted” corporations by Global Exchange for environmental destruction, health violations and violent killings.

Global Exchange accuses Chevron of endangering the land and wildlife of the Amazon during its 1964-92 involvement with Texaco Oil Co. The companies are accused of dumping 18 billion gallons of toxic wastewater in rivers used by indigenous communities for bathing, resulting in cancer, skin lesions, birth defects and miscarriages. In 2001, Chevron merged with Texaco.

The company’s largest refineries in Richmond, Calif., produce oil flares and toxic waste by processing 350,000 barrels of oil per day. Local residents suffer high rates of lupus, skin rashes, rheumatic fever, liver problems, kidney problems, tumors, cancer, asthma and eye problems, according to Global Exchange.

In 1996, Burmese villagers who live along the Yadana pipeline, represented by EarthRights International – a human rights and environmental abuse watchgroup, filed a lawsuit against Unocal Corp., a recent subsidiary of Chevron, alleging charges of rape, summary execution, torture, forced labor and forced migration.

In 2005, the parties reached a settlement, resulting in Unocal pledging funds to “improve living conditions, health care and education and protect the rights of people from the pipeline region,” according to a March 21, 2005, joint statement between Unocal and ERI. Chevron acquired Unocal on Aug. 19, 2005.

Acci

(Visited 62 times, 1 visits today)
Next Story