Rejecting Silence 1: The University

**Preface: This is the first of what will be a series of posts inspired by the shameful catastrophe in Bangladesh. In it I'll draw attention to various undiscussed players (as in the last), share ideas for effective action, and comment on actions taken and not taken by major players. If anyone has any specific content requests, please feel free.**

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Before I respond to a reader's facebook request for my recommendations regarding the responsibilities of larger shareholders, I am happy to inform those who don't know of two positive developments. First is that a coalition of investors and faith-based organizations, through the Interfaith Center for Corporate Responsibility, have published a letter demanding improved working conditions for laborers in Bangladesh. Second, Amalgamated Bank LongView Funds drafted a similar letter signed by investors¹ from numerous organizations and firms. The language of these letters rebukes American corporations' (including The Gap Ltd. and Walmart), arguments that investors interests are best served by non-binding agreements for improved working conditions. Investors represented by these letters account for $1.1 trillion and $1.35 trillion in assets and assets under management, respectively. The interests--fiduciary and moral--of investors, whether signatories or not, are vulnerable to the effects to the consequences posed by signatories. Compliance with these influential investors ultimately serves the best interests of all those involved.

Of course, the list below (fn1) in no way represents all of any particular kind of industry. So, for a moment, let's discuss a major category of players completely absent from the list: universities. Unfortunately, universities often keep the specifics² of their corporate investments under lock and key. However, there are are other ways to influence these institutions to be responsible with their financial dealings.

Educational institutions answer to numerous players, and are therefore more vulnerable to pressure from various groups. For one, universities are accountable to students. Public universities are accountable to tax payers. All universities are accountable to alumni. They're also answerable to sports fans! This puts power in a wide variety of individuals hands and still, somehow, the expansive cross-section of the public takes only sporadic interest in universities' contributions--positive or negative--to the human rights discourse and experience.

Luckily, given the secrecy surrounding university finances, institutes of higher education are influential as more than just investors. They also have important contracts with manufacturers and retailers in a host of different industries. Therefore, pressure can be placed on universities--or collegiate athletic conferences as a whole--to make signing rights agreements a condition of contracts or contract renewal. In 2012 the Collegiate Licensing Company estimated that the market value of college-licensed goods was $4.3 billion. That's up from $3.9 billion in 2010. It is plausible, if not certain, that universities contracting with apparel manufacturers have some means of influencing behavior. Could a corporation possibly argue that signing a labor rights agreement served its shareholders' interests less than losing collegiate brand contracts? I certainly don't think so--especially if the university was joined by corporate shareholders in their plea for industry reforms.

In sum, universities are in a somewhat unique position to motivate change: They often hold sway as investors. It is likely that all have some pull as a brand. But more importantly for those of us feeling powerless, universities are vulnerable to the calls of many populations. That is both accountable to and influential among a diverse array of interests. It's time to make OUR voices heard.

Let's give everyone something to cheer about.

Coming up next...What not to do: Corporations Behaving Badly

¹Including representatives from: Corporate Governance Amalgamated Bank LongView Funds, Office of Investment American Federation of Labor-Congress of Industrial Organizations, California State Teachers' Retirement System, Connecticut Retirement Plans and Trust Funds, F&C Asset Management plc, North American Engagement Hermes Equity Ownership Services Limited, Illinois State Board of Investment Cllr, LAPFF  Local Authority Pension Fund Forum, Responsible Investment & Governance MN, The Nathan Cummings Foundation, The New York City Pension Funds, New York State Common Retirement Fund, Responsible Investment PGGM Investments, International Brotherhood of Teamsters, Teamsters Affiliates Pension Plan, and UAW Retiree Medical Benefits Trust

² Many university boards have created special associations governed by the university to manage and choose their investments. These are often called "Offices of Investment Management" or "OIMs". The Google search term "university office of investment management" returns several. Of course, you can also be more specific in your choice of terms.