Harvard Darfur Action Group

Divestment

Mission
Why Divest?
FAQ
Press

Mission

To identify and pursue strategies in order to generate financial pressure on the Sudanese regime to end their campaign of genocide in Darfur and to end the financial complicity of public and private instututions around the globe in genocide. For a history of Harvard's first divestment campaign, see The Nation, Apr. 28, 2005: "How Harvard Divested From Petrochina".

For more information about our most recent campaign, please visit www.harvarddivest.com.

Divestment as a Tool to End Genocide

Genocide and Divestment: Since the genocide in Darfur began in 2003, the world has attempted to exert pressure on the Sudanese government with minimal success. The Sudanese government relies heavily on foreign investment to fund its ongoing genocide. In addition, the Sudanese Government has shown itself to be responsive to financial pressure in the past. Given this particular confluence of factors, Darfur presents a special case in which institutions can influence the Government of Sudan by pressuring the companies that are funding the genocidal campaign to sell ("divest") shares that they own in the companies operating in the Sudan...

What is divestment? Divestment is the process of selling shares of a company in which Harvard University is invested. This tool can be used as a moral statement that Harvard does not support the actions of the company that is financially complicit in a genocidal regime. Harvard University has an endowment managed by Harvard Corporation invested in both domestic and international companies from a range of industries. Due to a United States Executive Order, no US corporations are able to invest directly in the Sudan; however, some of Harvard's investments are in foreign corporations that are engaged in business with the Government of Sudan. These are the companies that are considered for possible divestment.

Harvard's role: Harvard University can make a statement that it will not be morally complicit in the companies' affairs by withdrawing its funds from those companies. As a result, this action or the mere threat of divestment will encourage the companies to engage with the Government of Sudan to end the genocide or cause them to withdraw operations and significant profit margins from Khartoum.

Hasn't Harvard University already divested? Yes, over the past two years, the University has pursued ad-hoc divestment from its shares in Petrochina and Sinopec, citing in the case of Petrochina that "there is a compelling case for action in these special circumstances, in light of the terrible situation still unfolding in Darfur and the leading role played by PetroChina's parent company in the Sudanese oil industry, which is so important to the Sudanese regime." However, a targeted model would be more a more appropriate response to the most egregious companies operating in Sudan. The model is well-researched and road-tested, with other universities and the State of California having already implemented the model.

What is targeted divestment? Targeted divestment affects only companies that meet very stringent criteria; companies that (1) have a business relationship with the government of Sudan or are involved in a government-sponsored project and, (2) impart minimal benefit to Sudanese civilians, and (3) have demonstrated no substantial corporate governance policy regarding the Darfur situation and (4) fail to respond to attempts at shareholder engagement.

Has Harvard University ever divested this thoroughly in the past? Yes, Harvard University divested during both the South African Apartheid and from tobacco industries. In 1984, the University divested from companies that received the lowest ratings in the Sullivan Principles until the end of Apartheid, and the University divested from all companies in the tobacco industry indefinitely.

For more information, visit Sudan Divestment Task Force website at www.sudandivestment.org.

Frequently Asked Questions

Below we address the following misconceptions about divestment:

1. "Divestment will cut the Sudanese government's already limited funds for development, hurting civilians."
2. "Governments without the rule of law are unresponsive."
3. "Divestment jeopardizes the momentum of an anti-genocide movement."
4. "We should be pushing for a UN peacekeeping force in Darfur."
5. "A single petition won't save Darfur."

1. "Divestment will cut the Sudanese government's already limited funds for development, hurting civilians."

This belief stems from a misunderstanding of the aims of targeted divestment and is actually far more applicable to the South Africa divestment, in which the Sullivan Principles outlined aims and desired changes but not methods of selecting companies for divestment. Our model specifically targets those which impart minimal social benefit upon citizens outside the government, meaning that these companies are not engaging the government in social development projects.

The average Sudanese civilian is not benefitting from the targeted foreign investments. Only half of Sudanese live in the northern states, where the benefits of oil production have been concentrated (despite the geographical reality that most oil comes from the south), and improvements have been inequitably distributed. Even at the locus of development, Khartoum, over two million people (a full third of the total six million) reside in squatter camps on the periphery of the city, most without electricity or running water (Washington Post). In the name of "development," these camps are frequently destroyed to make way for roads or shopping malls for more affluent Sudanese, and this region is calm in comparison to the turmoil that is Darfur.

Paradoxically, the Sudanese government is spending record amounts, embarking on what the New York Times describes as "an infrastructure binge, pouring hundreds of millions of dollars into roads, bridges, power plants, hospitals and schools, projects that tend to boost any government's popularity." These projects are aimed at the northeastern region, however, and both the South and Darfur have been utterly neglected and in fact the object of past and current military attacks. They are undertaken to benefit a sliver of the Sudanese while depriving others of the most basic assistance.

The companies we target bring the bulk of their workforce from their own countries, and only a fraction are actually Sudanese. Additionally, 80% of working Sudanese are in the agricultural sector, which is not targeted under our model (Divestment Proposal, 36). The GNU (Government of National Unity, a power-sharing arrangement between South and North, with al-Bashir as its president) has already committed 200 million USD for both 2007 and 2008 to rebuild the Darfur region (Darfur Peace Agreement, Article 153a). Reducing foreign investment in Sudan by way of divestment does not alter these obligations. Sudan has a poor history of following through on these commitments, of course, and will probably break its hollow promise, but this is not for lack of revenue. Furthermore, not all development is good development. In the name of mechanized agriculture, thousands have been forced off of their land in eastern Sudan, which has created resource struggles as the displaced move further west and south and compete against inhabitants of these areas. The oil-driven economic boom has led to an insidious government practice known as kasha, under which mud houses are bulldozed by the government to clear the land for sale to developers (Washington Post). No consultation is undertaken with these already impoverished residents, who are subsequently forced to move further into the desert.

Sudan also does not face external military threats or require increased military buildup. If the government reduces military expenditures, it will simply restrict its ability to wage a continuing genocide on the scale that it has.

Indeed, over 70% of oil revenues are currently used to fund military expenditures (New York Times). Finally, continued military spending will only intensify attacks on humanitarian aid workers and refugee camps and could very well force these groups to scale back their operations or even pull out of Sudan (AllAfrica). The loss of food and medical assistance to the country's most vulnerable individuals, those internally displaced persons who have fled military assault, would result in disease and malnutrition that NGOs have so successfully worked to minimize.

The logic that depriving the Sudanese government of funds will, on balance, hurt civilians ignores the targeted nature of divestment and relies on the fallacy that the government will choose to cut its already inadequate social spending. If we believe this argument, after all, and if the benefits of money in the hands of these leaders is so great, should we not be donating money to Khartoum?

Obviously, the notion is ludicrous because this money is not being allocated equitably or efficiently. Thus, a decrease in national development funding, as currently allocated, is not likely and would have far less deleterious consequences than the withdrawal of aid agencies due to deterioration of security.

2. "Governments without the rule of law are unresponsive."

Clearly, the Sudanese government is ignoring the needs of the bulk of its population, catering instead to those inhabiting Khartoum and pitting people it oppresses (like Arab herders forced off their traditional lands) against more distant targets to the south and west. It has long marginalized and is now actively destroying peripheral regions like Darfur and has ignored repeated pleas for a fair allocation of resources.

Yet the government is responding to its eroding base of support by increasing spending. Current development projects are not focused on meeting basic needs but rather on making commercial and cosmetic improvements which benefit a segment of the Sudanese population. Spending on these sorts of projects is a desperate attempt on the part of northern leaders like al-Bashir to retain some popular support and transform the image of Khartoum.

Entities operating in Sudan concede that American economic sanctions on Sudan are not enough, and divestment is a way for those residing in the U.S. to exert financial pressure on foreign corporations and nations. " 'The Americans are not a threat, but if the international community lines up against us, ahh, that is a different issue,' said Osama Daoud Abdellatif, chairman of the DAL Group, a conglomerate that owns the Coke factory, the Ozone Cafe and a number of other businesses. 'Everything has been going so well, but Darfur could spoil the party' " (New York Times).

To be clear, divestment does not amount to another American sanction. The U.S. can only legally bar companies based in the U.S. from conducting business in Sudan. By contrast, divestment leverages the tremendous American capital invested in foreign firms to force them to change their business processes, a less direct but sorely needed disincentive.

Autocratic governments like al-Bashir's in Sudan rely on foreign support precisely because they lack domestic legitimacy. China in particular has enormous influence over Sudanese leaders. When state-owned Chinese companies like PetroChina and Sinopec are targeted by divestment, the intent is not to make them withdraw from Sudan. After all, they are hardly likely to forego lucrative supplies of oil.

Instead, divestment would begin to make these oil investments less profitable, and the Chinese government would eventually decide to convince al-Bashir to allow a UN peacekeeping force (which has already been authorized by the Security Council) into Sudan. If China is truly the key to securing reluctant Sudanese approval for peacekeepers, then it must first be convinced that Chinese economic interests are threatened by collusion with a genocidal government.

3. "Divestment jeopardizes the momentum of an anti-genocide movement."

Divestment has provided a rallying point for activists at Harvard and is widely supported by students and faculty.

In each of the past two years, student-led movements have brought the issue to the Harvard Corporation and secured divestment from PetroChina and Sinopec. Regrettably, Harvard has not yet fully divested, and a criteria-based approach is needed to ensure that none of our university's funds are sponsoring the Darfur Genocide.

Much of the advocacy work done by Harvard's Darfur Action group, such as calling Congressional representatives, fundraising, or protesting and rallying, has a more limited or less visible impact, which is unsatisfying for many.

By contrast, the targeted divestment campaign helps students understand that they have both a moral and financial stake in the genocide while offering them a way to achieve tangible results. It provides an excellent opportunity to educate students on the history of genocide and the crisis in Darfur and to generate public interest in Darfur throughout the community through the media coverage it attracts. In sum, discussions of divestment inevitably bring awareness to the Darfur genocide.

While we have a broad base of support for our divestment campaign, the few opponents to divestment on campus have not elected to work with us on our non-divestment advocacy projects. Our challenge to detractors is to work in whatever way they can to end the genocide - calling senators, writing letters, attending rallies, and more. But after four years of these tactics producing limited results, it's time to try other methods, as well.

It's also worth noting that even our members largely believe that divestment is not desirable in response to most crises. In this case, however, we are convinced that divestment is necessitated by the urgent nature of the genocide and legitimated by the past responsiveness of Khartoum to economic pressure.

4. "We should be pushing for a UN peacekeeping force in Darfur."

While a UN peacekeeping force in Darfur is desirable, we believe it is unlikely one will ever be deployed without the consent of the Sudanese government. The mission was authorized by the UN Security Council in Resolution 1706 last August, but it has failed to materialize due to (predictable) opposition from President al-Bashir. Calling congresspersons will not change this. Instead, the pressure of divestment will help force the Sudanese government to make concessions and allow UN peacekeepers in.

5. "A single petition won't save Darfur."

Signing onto a petition could never completely repair Darfur, just as divestment, a UN force, or even the magical disappearance of the Janjaweed could not. Darfur is a broken land, with some four hund red thousand slaughteredand two and a half million barely subsisting in refugee and IDP camps. Repairing the damage done in Darfur is a tremendous task, which is exactly why we need to involve as many people as possible and work as though lives depend on it - because they do.

Our petition has two goals: raising awareness about the genocide and demonstrating the support of Harvard students, faculty, and alumni/ae to targeted divestment. It is a means to our goal of fully divesting Harvard of companies which facilitate genocide with the revenues they provide to the Sudanese government. Divestment, in turn, is a means to starve the military of revenues and bring cessation to the killings. It is also intended to weaken Khartoum's bargaining power and convince colluding corporations to pull out or use their influence to end the genocide.

Of course, it is also a way to send a powerful signal, a way to make Harvard a leader in condemning the genocide and working to put lives first, not profit. Harvard's prior agreements to divest placed it in the vanguard of the national divestment movement, a movement which has continued to grow and now encompasses a range of universities and state governments. Twelve states have already divested, most notably California (with a targeted divestment model very similar to our own) last September. Over a dozen others are currently considering legislation to divest, as well.

We know divestment is having an effect. The Sudanese government recently took out a full page in the New York Times specifically to promote investment in their country and to allay fears. ABB, Siemens, and Rolls Royce have already terminated business with the Sudanese government, citing divestment as a factor. Divestment only works if many people and institutions commit to divest and actually honor those commitments, and it is for this reason that we need to continue pressuring Harvard.

So no, your ten-second signature will not save Darfur, not by itself, at least. But we know from the Holocaust and from Rwanda what happens when people don't take the time to act. Please, consider the merits of divestment and the facts supporting it rather than hollow and baseless claims. We are students, admittedly, and do not (yet) make the decisions to deploy peacekeepers or strike diplomatic bargain or place asset freezes on military leaders. But we each have a voice that means something to one of the most wealthy and influential educational institutions in the world. Don't let that voice be stifled.

Links:

Text of the Darfur Peace Agreement

New York Times article

Washington Post article

All-Africa article

Press

Students React to Divestment Decision
July 6, 2007 - The Harvard Crimson

Harvard's Sort-of Divestment
July 2, 2007 - Inside Higher Ed

Harvard OK's some Darfur investments
June 30, 2007 - The Boston Globe

Harvard Can Own Funds Holding Stocks Tied to Sudan
June 29, 2007 - Bloomberg

Divestment Not An Easy Affair
May 16, 2007 - The Harvard Crimson

UC Votes To Encourage Harvard To Cut Ties with the Sudanese Government by Ending Indirect Investments
April 16, 2007 - The Harvard Crimson