Calvert's Senior VP for Social Research and Policy on the Urgent Need to Address the Crisis in Sudan
Why is Sudan an important issue right now?
Over the last several years the situation in Darfur has become probably the most important and urgent human rights and humanitarian crisis in the world. The regime in Khartoum had previously fought a vicious civil war with the whole southern region of the country and in the last several years has been directly complicit with atrocities of the magnitude that compelled the US Government in 2004 to characterize them as genocide in the Darfur region in particular. It's not easy for the US Government, or others in the international community, to use the word "genocide." When used, it certainly focuses attention on the gravity of the situation.
What is Calvert doing to address this crisis?
As the situation in Darfur has deteriorated in recent months, we at Calvert felt compelled to see what, if anything, we could do that would make any positive contribution whatsoever toward mitigating the situation there.
First, we took a very close look at our social fund portfolios. We checked to be sure we have no current investments in companies that are on the targeted divestment list put forward by the Sudan Divestment Task Force. And that means we're not investing in companies that have a significant presence in the country or really materially contribute to the revenue base of the regime in Khartoum, let alone toward facilitating the atrocities and human rights abuses that it continues to perpetrate on its own population.
We were struck by the growing and potential further impact of the Sudan divestment movement, especially by the fact that a number of major pension funds—especially at the state and local levels—have decided to divest themselves of stocks that are on that divestment list put forward by the Sudan Divestment Task Force. Several states, Illinois among them, have passed legislation compelling their pension funds to divest of Sudan-related stocks.
As we've seen the momentum grow with this divestment movement, it seemed to us that given our expertise in social and especially human rights research and analysis, we might be in a position to provide some substantive support to this movement.
Tell us about Calvert's partnership with the Sudan Divestment Task Force.
The Sudan Divestment Task Force has been at the forefront of the current divestment movement in the United States, and it's a remarkably focused and effective operation for one that has only just got off the ground in recent months.
We're pleased to be in a position to have some relevant capabilities that can contribute to its work. To that end we're delighted to be entering into a partnership with the Sudan Divestment Task Force, together with the Save Darfur Coalition, both to support the analytical work of the Sudan Divestment Task Force and to support the targeted divestment advocacy work of both organizations.
Specifically, several Calvert social research analysts will be working with the Sudan Divestment Task Force to review the analytical criteria that the Task Force has developed in recent months that are used to judge which companies warrant being on the divestment target list. It's not at all an obvious decision as to which companies should be on or off the list. Our own review gives us confidence that the analytical criteria developed by the Task Force are sound. Yet at the same time, the Task Force has asked us to help in applying their criteria to specific tough cases as they emerge. And our social research analysts at Calvert are great at making tough calls on the margins as to the performance of certain companies around very specific issues -- based on very specific criteria.
It's the heart of what we do. So we'll be providing this kind of analytical expertise on a continuing basis and also lending our support on the advocacy side to the targeted divestment movement. We can take advantage, of course, of the facts that Calvert is next to Washington, DC; that we've got useful relationships with the US Government, particularly at the State Department and with Congress as well as with human rights NGOs; and that we can therefore lend the benefit of those relationships together with our experience and our expertise to help this targeted divestment movement.
Calvert is not the only SRI firm with a compelling interest in doing whatever it can to address the Darfur crisis. Other firms have taken an interest as well. So part of our initiative is to work as closely as we can with others in the SRI community, especially in the US, to make sure that we are combining and leveraging our efforts wherever we can.
Why does Calvert think targeted divestment can make an impact?
What gives us confidence that this targeted divestment movement can make a difference is that it's well-focused on a narrower rather than wider group of companies operating in Sudan. This divestment movement, as coordinated by the Sudan Divestment Task Force, does not seek to knock out of Sudan each and every company with any presence there whatsoever. What it does seek to do, and what Calvert explicitly supports, is to discourage companies from continuing to operate in Sudan that have direct ties to the government in ways that sustain the regime's revenue base and its overall ability to remain in power. For that reason, the targeted divestment list focuses on large-infrastructure companies, and in particular, those that are essential to the fundamental workings of the economy and that contribute to its revenue base -- especially companies working in the oil sector, which has proved to be the major source of revenue for that government.
Does this divestment movement have links with the anti-Apartheid divestment movement?
Supporting the Sudan divestment movement is an easy and natural choice for Calvert, given both our values and our history. After all, Calvert was the first US SRI firm back in 1982 when we launched our first social funds -- or the first mutual fund of any kind -- to declare that it would not invest in companies operating in then-Apartheid South Africa. We supported that divestment movement for its duration through the 1980s. And of course [the movement] made a significant contribution to the downfall of Apartheid.
The Sudan divestment movement is a little more complicated in some respects than its South Africa predecessor with which Calvert was closely aligned. That's partly because it will probably prove to be more difficult to bring to bear direct economic pressure through divestment on the regime in Khartoum. That's the case because the regime is fairly impervious to outside pressure -- probably more so than the Apartheid regime was in South Africa. It's also because Chinese-based oil companies and others based elsewhere in the world are disinclined to leave Sudan, and for that reason the divestment movement is going to have a tough nut to crack.
Are there limits to what targeted divestment can achieve?
There are limits to which this current divestment movement can make a real economic impact on the government of Sudan. But even with that recognition, the targeted divestment movement itself—and we at Calvert certainly concur—makes a critical political and moral statement that is certainly worth making alongside the overall economic impact that we're trying to achieve at the same time.
We just don't feel that we have the luxury of sitting back and not taking a stand on Darfur. It's really up to everyone—whether governments, international institutions, multinational corporations, investors, NGOs, citizen-activists—to take a stand and do what we can that's consistent not only with our values but also our capabilities. So with Calvert that comes back to ensuring that our portfolios are free of companies with any significant material involvement in Sudan, and to remain vigilant as corporate involvement in the country may change. And it means in our case taking the extra step of partnering with the Sudan Divestment Task Force and the Save Darfur Coalition to give the kind of analytical and advocacy support consistent with our experience that they've asked us to provide at this important time.
So at Calvert we feel that this is the right thing to do at the right time, given the gravity and urgency of the situation, and given our identity as a socially responsible investment firm with a strong legacy of commitment to human rights.
Bennett Freeman, Senior Vice President for Social Research and Policy
University of Oxford, MA in Modern History; University of California at Berkeley, AB in History.
Mr. Freeman manages Calvert's Social Research Department and directs its research and advocacy work. From 2003 until early 2006, he led Burson-Marsteller's Global Corporate Responsibility practice advising multinationals on policy development, stakeholder engagement and communications strategies related to human rights, labor rights and sustainable development. During the Clinton Administration he served in three positions as a political appointee in the State Department, most recently as Deputy Assistant Secretary for Democracy, Human Rights and Labor from 1999 to early 2001. In that capacity, he led the development of the Voluntary Principles on Security and Human Rights, the first human rights standard forged by governments, companies and NGOs for the extractive sectors. Earlier in his career he was Manager-Corporate Affairs for General Electric and a presidential campaign aide to former Vice President Walter Mondale. He serves on the Board of Directors of Oxfam America and the Steering Committee of Amnesty International USA's Business and Human Rights program.