US Activists pressing public pension funds to divest $91 Billion in Sudan

By Marcy Gordon, AP Business Writer

WASHINGTON, Nov 14, 2004 (AP) — Black activists and religious groups are pressing public pension funds to divest a purported $91 billion in holdings of companies operating in oil-rich Sudan.

Displaced Sudanese children pray Saturday, Nov. 13, 2004, in the Kalma refugee camp near Nyala town in Sudan’s western Darfur region. The children were saying special morning prayers marking Eid al-Fitr, the feast that marks the end of the Islamic holy month of Ramadan.Ramadan was deemed by clerics in Sudan to be over Saturday. (AP).

Activists, including members of the Congressional Black Caucus, are making the case that public pension funds should sell investments in companies that do business in nations charged with sponsoring terrorism.

“This issue has captured the moral center of the vast majority of the people in this country,” the Rev. Walter Fauntroy said. The former congressional delegate for the District of Columbia was a leader of the successful South Africa divestment campaign in the 1980s.

No American companies are involved in the drive because of U.S. government penalties against Sudan. The pension funds do invest in shares of foreign companies that are active in Sudan — 83 in total, according to the Sudan Campaign. The group’s leaders cited the German equipment maker Siemens, the French oil giant Total, the Swiss-based engineering firm Asea Brown Boveri, Talisman Oil of Canada and PetroChina.

Pension fund officials have been noncommittal so far about the divestment campaign.

They often chafe at political demands to change investments, saying their primary duty is to secure a healthy return for funds that hold the retirement incomes of 20 million public employees around the country — and that amounts to some $2 trillion.

“It’s a very sensitive issue,” said Frederick Nesbitt, executive director of the 500-member National Conference on Public Employee Retirement Systems.

The group has no position on the Sudan divestment drive. But Nesbitt said that in general, “We become concerned when people start drawing lines. … You could end up having no place to invest.”

The leaders of the Sudan Campaign — Fauntroy and civil rights activist Joseph E. Madison — said in an interview that they want teachers, police officers, firefighters and other public employees to realize that in all 50 states, some of their retirement money is invested in companies that do business in Sudan.

Fauntroy and Madison are urging “shareholder activism,” asking people to write to pension fund managers and state legislators.

The campaign also includes the American Jewish Committee, Christian Solidarity International, the Salvation Army and other groups.

The California Public Employees Retirement System, the nation’s biggest public pension fund, is one of the largest holders of Sudan-related investments with some $7.5 billion, according to the activists. Their fund-by-fund figures, and the total of $91.2 billion, come from the Center for Security Policy, a conservative think tank that has pushed for divestment from companies doing business in terror-sponsoring nations.

The figures cannot be verified by the pension funds. They must disclose their holdings in reports to state authorities, but the investments in companies are not categorized by country of operation.

“We don’t have the resources to be CIA agents in this field,” said Brad Pacheco, a spokesman in Sacramento, Calif., for the $166 billion California pension fund, known as CalPERS.

Like many funds, CalPERS has adhered to prohibitions of the two most notable and successful divestment campaigns: the one that helped defeat South Africa’s system of apartheid and the drive against tobacco company investments.

But CalPERS officials generally do not believe that divestment is the solution to the problem of terrorism abroad, Pacheco said.

Some pension fund officials say it is more effective for the funds to work from within and bring pressure on company executives to make changes — and that divestment should only be a last resort.

For the New York State Common Retirement Fund, said to hold $6.2 billion in Sudan-related investments, “Sudan is an issue that we’re looking at,” said John Chartier, a spokesman for state Comptroller Alan Hevesi, who is the fund’s trustee.

Fauntroy said that if the funds in California and New York agreed to divest, “It would set the standard for leadership.”

Sudan Campaign: http://www.sudancampaign.com

National Conference on Public Employee Retirement Systems. http://www.ncpers.org

California Public Employees Retirement System: http://www.calpers.ca.gov

New York State Common Retirement Fund: http://www.osc.state.ny.us

Center for Security Policy: http://www.divestterror.org