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About Oregon daily emerald. (Eugene, Or.) 1920-2012 | View Entire Issue (April 1, 1985)
BUSINESS A hiiapartheid demonstrators at VC, Berkeley: A crisis of conscience on the campus est American investments are concentrated in oil, auto, mining and rubber works. These giants, like Mobil, General Motors, Ford, Goodyear. IBM and Union Carbide, are regularly.challenged by shareholders over their South African investments. Most de fend themselves by pointing to their adher ence to the “Sullivan Principles," drafted in 1977 by the Rev. Leon B. Sullivan, a Phila dephia pastor who serves on GM’s board of directors. His statemen t offers six principles of conduct for com panies doing business in South Africa—among them desegregating work places, paying equal salaries for equal work and training non whites for manageri al positions. Are the principles making any differ ence? Like almost everything else in South Africa, the answer depends on your point of view. The most recent monitoring report, prepared by Arthur D. Little Inc., of Cambridge, Mass., gave a mixed review. Thirty-two firms, including GM and IBM, ranked in the “making good progress” category. Another 44, including Ford and Gillette, were rated as “making progress.” Thirty-two others, including Motorola and Carnation, were said to “need to become more active.” Still, the report says that all work stations in the surveyed companies have been desegregat ed and that blacks hold more jobs than they once did. The bad news is that only 1 to 6 percent of managerial appointments go to nonwhites, and the percentage of non whites training for these jobs has fallen. No one pretends that this record is entire ly satisfactory. “The bottom jobs are still full of blacks and Colored, and the whites are still on the top,” complains Jennifer Davis of the American Committee on Afri ca. “The Sullivan Principles maintain and strengthen the whole system.” But, counter American executives; critics.must be more realistic. “We all agree that it is a; morally indefensible system and that it should be changed," says William Broderick' of Ford Motor Co. "The real difference is over the most effective means to achieve such changes. Sullivan signatories say stay, and work for change pn t he spot This moderate approach has great appeal to university administrators,. since, if both assumes the possibility of rational reform and endorses the maintenance of. lucrative investments. But it’s a hard sell.to.campus activists, as Columbia’s weary Dean Pol lack has learned. Chairman of a university investment-review committee, Pollack rec ommended last November a multistep ap proach to the problem that appears; to.have cost him support on both sides. While op posing outright divestment, the group sup ported refraining from any new investments in companies that deal with South Africa and leading an effort by a consortium of - universities to stiffen the SulliVan rules. St u dent opponents find this approach namby-pamby, yet it may still be too stern for the trustees. "The re port is not a sellout,” Pol lack says. “It hurts me that people think that.” Is there life after divest ment? The answer appears to be yes. In 1978, follow ing a round of student pro tests, the University of Wisconsin sold off all its shares in firms that had South African ties. The state school unloaded $9.8 million worth of stocks and bonds at a paper loss of about $850,000. The deci sion to sell, incidentally, did not come from the regents. Instead. Wisconsin Attorney General Bronson La Follette ordered the sale, after uncovering an obscure state law that prohibits the uni versity from doing business with companies that condone racial discrimination. The Texas regents'have refused' to sell- their i stocks, in part because of worries over their portfolio's ful ure. But t hat judgment too is a matter for debate - Student, groups have pointed to a 1.982 trust-company- report ar guing that'investments in large-companies without-ties to-South' Africa actually.;per- ;■ formed slightly better-1hanf.the-major,slock'- ] market average. ■’ -.- Rate of return: is.su.re to be one of the central issues in June when the' Califoriiia • r.egents.take up.a special, report on diyest anenl; About S I .7 billion of the system's S5.S 1 '• billiort poTtfolib is invested' in companies 'with South African ties I he stakes could . hardly be higher a complete L’C divestment wbujd be larger t han all (if ) he (it her cainpus 'sales..combined. Ninety, percent of these shares support staff and faculty pension funds, and the regents who serve as trustees are bound by law to behave in a "prudent manner." That consideration weighs heavi ly on regent Joseph Moore, who says, "It’s licit my money or the students'money, it s the employees’ money." The likeliest out come is that the regents will not opt for divestment blit may officially: protest apartheid.'.. • • Whether or not tIC divests, "The diVesiment campaign keeps the SputhAfricaiigciyernnient.herv ousand worried, sb i t dtjes. have an: effect,". according, to UjC-'.s. resident expert on South Africa, political; scifeii.ee”PrbT R<)b Crt Price - "The paradox is. t|iaf. it’s a powerful, toql. iintif it's used; (J!rice; sanc tions are invoked,' the power is loit.'-’"Nd university investor coi'i’ld' state; jhe creed, any better, and forithe-moment; .it appears iike'ly; -that, fe'w schools- will, challenge ■ Price’s .analysis: . From Harvard’s' Derek Bok to Stanford’s Donald Kennedy, The. Sulli ran: A mailer of principles leadership hopes to have it both ways: righteous state ments and a reasonable re turn. What university au thorities appear to believe is that the current South African regime will last awhile, whether they like it or not. But if they con tinue to invest, and they have misjudged the explo sive political situation, their dividend checks may be consumed in the fire next time. ARIC PRESS with RICHARD MANNING m Del roil. MARGAKI I MITM I IIACII m Berkeley. Calif. KI I I V K NOX in Austin, resas. SHARON WAXMAN m New York and bureau reports
