Dive Brief:
- The University of Pennsylvania’s board of trustees killed a proposal on Friday calling for the institution to divest its endowment in tobacco stocks.
- The move comes despite an open letter signed by more than 500 senior faculty members,citing the deadly health effects from tobacco and the industry’s marketing toward youth. In the 17-page proposal, professors noted that Harvard University, Stanford University, Columbia University, and others had divested from tobacco years ago, The Inquirer reported.
- Board chairman David Cohen said tobacco doesn’t qualify as a moral evil on par with genocide and apartheid, which would require divestment under university policy.
Dive Insight:
Although the amount of the tobacco investment by Penn’s $7.7 billion endowment is not public, Cohen said it is negligible. Trustees argued that the board has a fiduciary responsibility to maximize the endowment’s returns, and that there were other ways to make a stand against tobacco besides divestment. Cohen said, however, that the university could instruct new investment managers that it does not want to have any tobacco stocks in its name.