The University Record, October 8, 1997

Tobacco stock divestment among Assembly topics

By Kerry Colligan

Is divestiture of University holdings in tobacco stock a smart move? What is the proper role of faculty in the governance of the University? These are two of the questions put before the Senate Assembly at its meeting Sept. 29.

"We've got to be proactive rather than reactive," said Louis G. D'Alecy, chair of the Senate Advisory Committee on University Affairs (SACUA). "Despite the inefficiencies of the system, we've got to make an honest effort at it."

One of the recommendations the group may make concerns divestment of tobacco stock. In May 1997, the Assembly raised a series of questions about potential divestment of tobacco stock. SACUA forwarded a report to the Assembly addressing those questions. In summary, the report states that, theoretically, divestment increases volatility of the University's portfolio. However, over the past five years the Standard & Poors (S&P) 500 average annual return has been almost 3 percent higher than the S&P Tobacco Index.

The report also notes that several peer institutions˜public and private˜already have enacted divestment policies, including Wayne State, Harvard and Northwestern universities and public pension funds in California, Florida, Maryland, Texas and New York.

Whatever the Assembly decides to do about divestment, its communication with the executive officers will be crucial. D'Alecy told members to remember that in communications with executive officers and regents "there are structures in place that need to be fully utilized. Regardless, in a lesser day, where communication is less commodious, additional channels may be needed."

Assembly meetings may take on a different flavor this year. The Assembly will hear presentations from chairs of several Senate committees including the Academic Affairs Advisory Committee and the Committee on the Economic Status of the Faculty. These presentations, D'Alecy said, will be designed to keep the Assembly abreast of the agendas and activities of the various committees.

The meeting was the first of the academic year and included the orientation of new members for approximately one-third of the 72-member Assembly. D'Alecy outlined for them the committee structure and, in response to a concern raised earlier this year, emphasized the need for Assembly members to sit on various committees.

"One of the difficulties we have in the Assembly," D'Alecy said, "is that we only meet once per month. If we account for presentations by the president, provost and those concerning special events, it is difficult for us to fully discuss more than one or two issues all year.

"Because of that difficulty, the committee structure was established such that the action and activity occurs there. We are asking people who are already committed to do more. We've all got to do that extra little piece."

Other Assembly discussion

Additional announcements made at the Sept. 29 Senate Assembly meeting:

Copies of the "Principles" will be mailed to all faculty and are available at the SACUA office, 6048 Fleming Administration Building, 764-0303.