Socially Responsible Investing and Supporting the Free Exchange of Ideas
On college campuses around the country and here at the University of San Diego, concerns have been raised about investments and associations that USD may have with certain companies, countries, institutions or industries in light of the ongoing war in the Middle East.
First and foremost, USD stands in solidarity with Pope Francis and Cardinal McElroy in calling for an immediate ceasefire in Gaza, the release of Israeli hostages and the free flow of humanitarian aid to those impacted.
USD has a longstanding practice of aligning its investments with the university’s commitments to social justice, stewardship of the planet, protection of human dignity, and the promotion of the common good. In October 2021, USD updated its investment policy to emphasize its commitment to these values through the adoption of a revised investment policy statement, which was the result of a collaborative effort by our Board of Trustees, faculty, staff, students and alumni. These changes reflected the multiple commitments made by USD to set a standard for investment of university resources in a socially responsible manner, which includes not having investments in corporations and funds that directly profit from genocide, ethnic cleansing or activities that violate fundamental human rights.
In light of the concerns and questions expressed by members of our university community, we requested that USD’s investment partners review our endowment portfolio and identify any direct investment in companies that would contradict the university’s investment policy statement. Their review indicated no such evidence of investment within the university’s direct holdings that were not aligned with the investment policy statement.
The USD Endowment, composed of donor gifts and institutional savings, provides the university financial stability through the permanent funding of mission-critical needs like student financial aid, academic department support and student services. That support depends directly on the performance of endowment assets. The endowment must balance its socially responsible investment goals with other requirements, such as broad diversification to manage risk and achieving a strong return to sustain endowment resources in perpetuity. It is important to understand that USD does not select the individual stocks that make up the endowment’s portfolio, rather we are one of many investors in commingled funds, which limits our ability to dictate changes to a fund’s underlying holdings or identify every indirect connection or association.
In contrast to the university’s endowment, tuition dollars and grant funds are used to support university operations and not for investment purposes.
USD remains committed to the free exchange of ideas within and between institutions. Connections and programs with academic institutions around the world are vital to USD’s educational mission and role as a global university. Cutting ties or boycotting academic programs precludes scholars from collaborating across boundaries to share knowledge, expand research, fuel discovery and work for peace. It’s also important for students to have a full range of academic programs where they can safely explore their interests and passions as they seek to become global citizens.
We are proud of our record of investing in a socially responsible manner. We will continue to monitor global events and come together in civil dialogue and discussion as our community works together to create a more hopeful and peaceful world.