UC officials said the regents’ move, approved at a Los Angeles meeting, significantly differs from steps taken by other colleges, the San Francisco Chronicle reported. The university system will be shedding both direct and indirect holdings in nine publicly traded companies as it carries out the regents’ directions, the officials claimed.
The regents’ decision represents a significant step beyond divestment actions taken by other colleges, UC officials said, because the university plans to shed both its direct and indirect holdings in the nine publicly traded firms.
University officials refused to indicate the approximate dollar amount of the investments to be shed or what percentage of the university’s $4 billion foreign investment portfolio would be divested, saying that premature disclosure could affect the market for its shares.
According to the news report, UC spokesman Trey Davis said the university plans to sell off about two-thirds of its shares in the companies. Its remaining shares, Davis said, are in portfolios that are not directly controlled by the university. However, the university plans to write letters to the managers of those commingled accounts, urging them to consider the university’s action.
Californiastate Assemblyman Paul Koretz said that he would revise his own legislation urging CalPERS to withdraw public employee retirement funds from Sudan-related businesses to use UC’s divestment plan as a model.
“I think we have a greater moral responsibility that outweighs any purely fiscal principle,” Koretz told the newspaper. “This will be noticed … I have very little doubt that the other public pension systems in California will follow suit. This will make a very dramatic difference. I believe that it will ultimately save tens of thousands of lives.”
The nine firms from which UC plans to divest are mainly based in China, Russia, India and Malaysia. One of the firms, Taftnet OAO of Russia, has a history of trading arms for Sudanese oil. Two other firms, the China Petroleum and Chemical Corp. and PetroChina Co. Ltd., are among the Chinese firms that are tapping into Sudan’s vast oil reserves. Russia and China are Sudan’s primary arms suppliers.
Divestment will not take place until the state enacts a law that would indemnify the individual UC regents, administrators and their asset managers from any claims arising from Thursday’s decision.