Repository: UIHistories Project: Board of Trustees Minutes - 1986 [PAGE 300]

EXTRACTED TEXT FROM PAGE:

1985]

UNIVERSITY OF ILLINOIS

289

1. Complete divestiture by the University would have minimal effect upon the companies whose stock is sold or upon the government of South Africa; absence of standing as a stockholder would diminish further avenues of influence; 2. Replacement of investments sold would, of necessity, require purchase of securities in companies with smaller capitalization, thereby representing less diversification possibilities and thereby increasing overall portfolio risk. 3. Complete divestiture could be contrary to the policy of prudent investment and diversification whose goal is preservation and enhancement of public funds under the laws of Illinois. d. The current policy of the board of selective divestiture should be enhanced and amended to add the following provisions: Shareholder Petitions The University of Illinois will support petitions of a company doing business in South Africa where such petitions seek the following objectives: 1. the furnishing of information regarding corporate activities in South Africa, and 2. the termination or prevention of sales to the South African military or police. Stock Divestiture Because of our belief that the University can more effectively influence company policy by correspondence, shareholder resolutions, and public statements than by divestiture, the divestiture of stock in companies doing business in South Africa would be appropriate only under very limited circumstances. However, when persistent efforts to persuade a company to abandon unethical practices have proved ineffective and the outlook for future success seems hopeless, divestiture may be justified as a last resort. Accordingly, the University will consider divestiture if the following conditions are obtained: 1. The company has failed substantially to conduct its business in a manner consistent with the policy established by the Board of Trustees. 2. The company has failed to amend its policies in spite of our persistent efforts to persuade the company to conform with the policies as established by the Board of Trustees. 3. The company clearly indicates that it will not amend its position and policy to conform with the policy as enunciated by the Board of Trustees. 4. The company has not attained one of the top two rating categories of the Sullivan Principles or comparable standards of per-