Pro-Palestinian protesters at Columbia University recently broke into a building to demand the school divest from companies doing business in Israel. However, identifying and divesting from these investments is complex, as many university endowments are made up of numerous individual funds with differing rules on investments. Scott Malpass, former chief investment officer at the University of Notre Dame, explained that endowments are composed of thousands of distinct funds, each with its own investment policies. These agreements can be confidential and restrictive, making transparency difficult for students and faculty seeking information about their school’s investments.
Many universities have resisted calls to divest from Israel, offering limited information on their investment portfolios instead. Students have criticized the lack of disclosure regarding these investments, which often include indirect ties to companies in Israel through mutual funds and exchange-traded funds. While universities are required to report some investment information on the IRS Form 990, these reports do not provide specific details on individual holdings. As a result, some institutions only publicly report a small fraction of their total assets, leaving much of their investment portfolio undisclosed.
Despite the complexity of endowment funds, universities have divested in the past, such as from the fossil fuel industry following student protests. However, divesting from Israeli companies presents challenges, including concerns that it may not have a significant impact on the conflict in Gaza. Critics argue that corporate decisions and boycotts of goods may be more effective in influencing change. Additionally, there is a risk of alienating donors if universities choose to divest from Israeli companies, potentially leading to a loss of funding and support.
Chris Marsicano, director of the College Crisis Initiative at Davidson College, believes that campus protests in support of Palestine are attracting attention from the Israeli government. Prime Minister Benjamin Netanyahu has publicly criticized these protests, indicating their impact. However, the effectiveness of divestment efforts on campus remains a topic of debate, with some questioning the broader implications and potential unintended consequences of such actions. Overall, the issue of divestment from Israeli companies in higher education is complex and continues to spark debate and activism on college campuses across the United States.
