America

Sudan – Divestment activists get act together

20 July 2006
In America

By Nick Timiraos

July 19, 2006 — When Daniel Millenson sits down to persuade university investment officers or state-pension-fund trustees to divest themselves from Sudan, the 19-year-old arms himself with the tools of today’s student activist: a PowerPoint presentation, charts, maps, reports, proposed legislation and lists of targeted companies.

He asks his audience to take notes. “I go over a lot of information quickly because I’m not always given a lot of time,” explains Mr. Millenson, a sophomore at Brandeis University in Massachusetts and executive director of the Sudan Divestment Task Force, a U.S.-based group formed by college students last year.

Two decades ago, it took years for grass-roots activists to convince colleges and other institutions to sell holdings in companies that did business in apartheid-era South Africa. These days, a similar campaign targeting companies doing business in Sudan has gained momentum in a matter of months.

The difference is a tale of how activists have learned to harness both technology and information in ways that were unimaginable 20 years ago, while at the same time making a more sophisticated effort to sway investors. While divestiture movements of years past often had the feel of a scruffy campus protest — complete with tense standoffs between board members and crusaders — tie-dyed shirts and bullhorns have been replaced by tucked-in oxfords and white papers.

“They wanted to work with us. They were patient,” says Craig Carnaroli, executive vice president at the University of Pennsylvania in Philadelphia. “I remember in my day, students threw their buttons at the trustees. … This group, they came to meet with me in ties.” While Penn found it had no direct holdings in seven companies identified by an advisory committee, it agreed to refrain from future investments with connections to Sudan.

The students’ information-driven approach uses the Internet to spread their message and get results. “We must have released a thousand pages of research before we even had a rally,” says Adam Sterling, who graduated from the University of California, Los Angeles, in May and helped to form the task force.

The divestment campaigns aim at putting pressure on Sudan’s Khartoum regime, which the United Nations says has sponsored militias in the Darfur region, where more than 200,000 have died. The U.S. has referred to the violence as genocide. Students hope that as companies’ share prices drop in response to sales of their stock, those firms will either push Sudan’s government to end violence or decide to leave the country altogether.

At least five states in the U.S., including Illinois, New Jersey and Oregon, have passed legislation requiring state pension funds to divest themselves of Sudan-related holdings. New Jersey sold $2.6 billion worth — or 3.4% of its $75.3 billion in total assets — in 17 companies.

At least 15 other states are considering legislation fueled by the student campaign. The California State Teachers’ Retirement System pension fund said in April that it would consider divesting more than $11 million in holdings in three foreign energy companies operating in Sudan. The Conflict Securities Advisory Group, a Washington research-and-consulting firm, says some 2% to 3% of state pension-fund holdings could be affected by legislation.

There are 148 publicly traded companies that do business in Sudan, according to Institutional Shareholder Services, a research firm. Students focus on about 20, generally foreign oil and energy firms that activists consider least likely to provide humanitarian services and whose tax revenue could help the government to finance military operations. They include PetroChina Co., ABB Ltd., Alcatel SA, Siemens AG and Sinopec Shanghai Petrochemical Co., all of which trade on the New York Stock Exchange. A U.S. embargo keeps most American companies from doing business in Sudan; those doing humanitarian work are exempted.
Siemens of Germany says it believes providing “products and services such as medical equipment, power and telecommunication systems is more beneficial to the people of Sudan than disengagement.”

ABB, a Zurich supplier of power and automation technologies, says advisers, including nongovernmental organizations and U.N. representatives in Sudan, have encouraged the company to continue its operations. “We do believe that we have taken all precautions to ensure that we are not complicit, and on the contrary are a force for progress,” says ABB’s Ron Popper.

Alcatel declined to comment. PetroChina and Sinopec couldn’t be reached.

Students have made it easy to replicate their campaigns. The proposal that convinced University of California regents to divest Sudan-related holdings for the 10-campus system in March can be downloaded from the Sudan Divestment Task Force’s Web site. The organization offers a customizable version via email. It hopes to convince investors — and legislators — that divestment could help to build momentum for change in Sudan.

Another organization, the American Anti-Slavery Group, builds school-specific Web pages for new Sudan divestment campaigns. The group helped to launch bcdivest.com for Boston College this year, and an online petition on the site generates an email to the university’s president, treasurer and board chairman.

Students Taking Action Now: Darfur, an umbrella organization founded two years ago, has more than 200 college chapters in the U.S. and Canada.

Activists have taken their message to the national media. MtvU — a version of the music network seen on college campuses — produced a documentary last year that followed three American college students who visited with refugees in Darfur to tell their stories.

Massachusetts State Rep. Jay Kaufman credits the students with helping to make the state’s proposed legislation more politically acceptable by suggesting criteria to limit the number of companies affected, rather than target all companies doing business in Sudan.

Illinois, the first state to pass legislation, went with that “blanket divestment” approach. The National Foreign Trade Council, an industry lobbying group, is preparing to challenge the Illinois law in court on the grounds that states are unconstitutionally pre-empting federal authority to set foreign policy. “It’s not always true that doing something is better than nothing,” says William A. Reinsch, the group’s president, who says divestment will set back U.S. efforts in Sudan.