Show Me the Money: The Fight for Endowment Transparency

Underneath promises of a diverse campus community, an “elite” education, and a commitment to social responsibility, lies an unaccounted $804 million. This money, otherwise known as the endowment, sits in the hands of a select number of individuals who make decisions behind tightly closed doors about how to maximize financial returns and promote the prestige of the Vassar brand name.

With calls for increased financial transparency from the Vassar Greens, Students for Justice in Palestine, and Act Out, amongst other student organizations, the question of which corporations Vassar invests in is becoming increasingly contentious. Naturally, our curiosities were piqued by the conversations going on around campus and we decided to find out more about the state of Vassar’s investments. Where, exactly, is Vassar invested? Who makes the decisions about where we invest? What are the avenues for holding the administration accountable for where our money goes? Do the students have a say in any of this? How transparent, really, is Vassar with its money?

Before delving into this investigation, we were working with the assertion that financial transparency is a good thing. When students see which companies their assets are supporting, this can spark dialogues and in turn, the community is able to think critically about the role Vassar plays in actively engaging with the world around it – core tenets touted in our very own mission statement. Vassar is not a bubble (contrary to popular belief) and knowledge of our financial holdings is crucial to truly understanding this. However, we didn’t really know anything about these investments. Was that our fault? Was the information there, and we just hadn’t put in the effort to seek it out? This was our mission – we were going to find out where the money was.

When we began with our research, we quickly ran into dead ends. From the website “Vassar and the Economy” we were able to gather some rudimentary facts. Our investments are held in the form of our endowment, a fund that Vassar withdraws from every year to help pay for its operating and capital requirements. As the website further explains, “endowment funds are invested by the college in such a way that they can provide for annual spending and also sustain value over time.” More specifically, it provides for about a third of Vassar’s operating expenses over the course of an academic year. By looking at Vassar’s IRS 990, we found a basic breakdown of where the school is invested. The list reads, in order: financial derivatives, closely-held equity interests, hedge funds, venture capital, real estate, oil & gas, institutional mutual funds, marketable real estate, and balanced accounts. While this does provide general information about the asset allocation of our investments, the endowment ultimately remains hidden behind ambiguous terms that give a false appearance of transparency.

Upon further research, we learned that the main avenue for any sort of student involvement in Vassar’s finances is the Campus Investment Responsibility Committee (CIRC), which consists of two students, two alumnae, two faculty, and two administrators. The committee meets during the spring and the purpose, as Max Moran ’16, one of the student representatives on CIRC, states, “is to look at our school’s investments and see whether or not they’re ethical.” The committee does this through a process known in the corporate world as “proxy voting,” wherein shareholders vote on resolutions put forth about the questionable policies and potential human rights violations of corporations. CIRC discusses these issues, often using third party independent reports, and then makes a decision on how Vassar will vote in the proxy. CIRC then sends their recommendations to the Trustee Investment Responsibility Committee (TIRC), who make the final decisions. As Moran explains, “we don’t have any deciding power, it’s just recommendation power.” So CIRC, supposedly a representative of the entire campus community, has no real say in our investment policies. Like most other decisions about the college, the ultimate power lies with the Board of Trustees.

Clearly, this committee is not an effective means of informing the student body of the status of Vassar’s investments. While CIRC has played an important role in Vassar’s history, including successfully voting for divestment from companies doing business in South Africa in the 1980s, their role has become increasingly irrelevant. College endowments, Vassar’s included, have moved their investments away from directly held, publicly traded securities into more indirect investments in commingled funds where issues of responsible investing are largely ignored.

Within the context of American neoliberalism – a form of global capitalism based on increasing privatization of wealth and the deregulation of free markets – this shift in investment policy is a symbol of the growing link between academic institutions and multinational corporations. Despite the diminishing number of direct equity holdings in Vassar’s investment portfolio, zero changes are being made to the structure of CIRC that could address this change in investment policy, making CIRC a largely symbolic bureaucratic organization that gives the illusion of transparency and accountability.

Even if proxy voting was still a valid way to hold our investing policies accountable, the implementation of CIRC has been inadequate. It is simply impossible to find any concrete information, mainly, its past proxy voting records. When asked if any of this information was, or ever would be, publicly available to the student body, Moran’s answer was pretty straightforward: “No, because I know it’s a closed committee…I was never told that that was something I should be doing, like outreach, going out and seeing what people want us to vote.” While the students on CIRC are supposed to represent the entire student body’s needs, administrators have repeatedly failed to encourage their engagement with us on issues of proxy voting.

We decided to book an appointment with Stephen Dahnert, Vassar’s Associate Vice President of Finance and Director of Investments. We wanted answers, and Dahnert was the one who would be able to give them to us. However, it quickly became clear that our inability to find information wasn’t just an overlooked mistake. The Finance and Administration Department actively conceals information about our investments and it’s clearly more interested in functioning as a business rather than reflecting the concerns of its community. “An endowment portfolio is a nonpolitical thing,” claims Dahnert, “the endowment exists for one purpose: to make money for Vassar College so we can fulfill our educational mission.”

There are a number of things that are disturbing about these comments. For one, the claim that money is ever “nonpolitical” is wildly false; an illusion perpetuated by the privileged elite to preserve the status quo through allegedly “neutral” policies. Giving money to a corporation is an active form of support, whether that is the intention or not. With the increasing corporatization of the school and the focus on maximum financial returns, Vassar is continually excusing itself for questionable investments and financial accountability.

In defending Vassar’s policies of financial nondisclosure, Dahnert exposed the real reasons for keeping the information secret: to bar us from challenging the ethics of our investments. “If we release to the general public what our holdings are, whether at the security level or even the manager level, it instantly becomes politicized,” said Dahnert. And rather than having to investigate the policies and practices of corporations that we actively support with our finances, the Vassar administration chooses to ignore questions from students and teachers of alleged human rights violations by these companies. “It’s irrelevant to me what, say, twenty faculty members feel about this particular holding…maybe it’s true, maybe it’s not. I don’t know. It’s irrelevant to me,” asserts Dahnert, “And I think it’s irrelevant to the Board.”

This community thrives on the diverse ideas of all its members – faculty, staff, alumni, and students alike – and Vassar’s continual insistence on the irrelevance of our opinions is, quite frankly, offensive. We agreed with Dahnert that if Vassar’s investment records were released, different groups would object to certain companies for various reasons. However, being scared of backlash is absolutely no excuse. An intentional lack of financial transparency on the part of the school, besides being insulting to those who seek out this information, completely undermines Vassar’s emphasis on developing a critically thinking and socially conscious community. Instead, the Vassar administration avoids this political nuisance by hiding the information that could hold them accountable to the members of our community.

Where do we go from here? Vassar, clearly, has no interest in divulging any sort of financial information to the community without political pressure. And according to Dahnert, in terms of financial transparency, Vassar is “not dissimilar from other, you know, colleges, other endowments of our size…we’re quite similar to our peers in terms of how we go about investing.” Yet Dahnert’s comments about other schools not disclosing their financial status, when researched further, turned out to not be as black and white as he had implied. Dartmouth College, with an endowment approximately four times larger than Vassar’s, makes a list of endowment holdings available at the investment office to all members of the school community, as well as a list of past proxy voting records publicly accessible online. Carleton College, with an endowment size similar to Vassar’s, makes a list of all holdings available to select members upon request, and a list of past proxy-votes available to the entire school community. And even Vassar itself, back in 1977, disclosed all of its financial investments, dollar for dollar, to a student reporter in an article entitled “Vassar’s Investments: Are We Well Endowed?” in the then student newspaper Unscrewed.

But when it comes down to it, it doesn’t really matter how other schools handle their finances. Rather than encouraging intellectual growth and social justice-oriented politics, all elite academic institutions have become servants to corporate profits and the neoliberal business model. Still, as student activists, we believe in our own community’s ability to demand greater financial transparency and to challenge the academic-industrial-complex. We have a choice: Are we simply going to graduate as upwardly mobile individuals with elite degrees? Or are we going to actually mobilize collectively against the inequality and oppression that our college sustains?

Vassar… it’s time to practice what you preach.


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