Since 1972, Harvard has maintained a pair of committees that together play a central role in the University’s consideration of matters of shareholder responsibility. These are the Advisory Committee on Shareholder Responsibility (ACSR) and the Corporation Committee on Shareholder Responsibility (CCSR).
To an increasingly large extent, Harvard’s investments in the U.S. public equity markets are now held in the form of pooled investments and commingled funds typically managed by outside investment firms, rather than through individual stocks directly owned in the University’s name. In the absence of such direct ownership, Harvard itself does not have the opportunity to vote on shareholder resolutions related to specific companies. It does, however, aim to exercise its voice on a broad range of shareholder resolutions raising issues of corporate social responsibility, in view of its substantial if indirect exposure to a wide range of publicly traded U.S. companies.
The chief responsibility of the ACSR – which consists of four faculty members, four students, and four alumni – is to consider and recommend proxy guidelines on a range of issues and topics of current interest. With attention to Harvard’s existing precedent in voting on specific resolutions over many years, the ACSR proposes these guidelines for approval by the CCSR – which comprises a subset of the Harvard Corporation.
Once new or revised guidelines have been approved by the CCSR, Harvard Management Company (HMC) shares the guidelines with outside investment firms that manage funds for the University, urging the firms to give close attention to the guidelines when voting on relevant shareholder resolutions. The guidelines are intended to provide helpful advice based on an extensive body of precedent and thoughtful deliberation reflecting the views of a major investor.
Besides sharing the guidelines with external managers, the University makes them publicly available, so that other interested investors can consult them as desired in determining how to vote. Harvard also shares the guidelines in periodic public reports of the CCSR.
In instances where Harvard, through HMC, continues to directly own publicly traded domestic equities, and therefore retains the right to vote on individual shareholder resolutions, the ACSR is asked to assess the merits of the resolution in light of precedent and to advise the CCSR on how Harvard should vote. The CCSR then decides whether Harvard should support or oppose the resolution, or abstain from voting. Harvard’s votes are reported to its external fund managers and made known to the public.
In recent years, the University, through Harvard Management Company, has embarked on a range of initiatives intended to address issues of investor responsibility through active engagement with external investment managers, with companies, and with other institutional investors. Among other things, Harvard’s endowment was the first of any U.S. university to subscribe to the UN-supported Principles of Responsible Investment; Harvard became a signatory to the PRI’s Global Statement on Investor Obligations and Duties; and Harvard recently joined the initiative known as Climate Action 100+. HMC consults closely with the CCSR in regard to aspects of these and other engagements. For more information, see the HMC’s webpage on sustainable investing.
From time to time, the CCSR also addresses questions of investment (or divestment) policy. Examples include the 1989 decision to divest from companies engaged in the manufacture of tobacco products, as well as decisions in 2005 and 2006 to divest from certain companies involved in oil production activities with the government of Sudan (which had been found to be engaging in genocide). The Statement by Harvard Corporation Committee Shareholder Responsibility Regarding Stock in PetroChina Company Limited (April 2005) endorsed the ACSR recommendation, which described the University’s policy: “The University maintains a strong presumption against divesting itself of securities for reasons unrelated to investment purposes, and against using divestment as a political tool or a ‘weapon against injustice’—not because there are not many worthy political causes or deeply troubling injustices in the world, but because the University is first and foremost an academic institution.” Occasionally, the CCSR seeks advice on such questions from the ACSR or others.
CCSR Membership 2019-2020
The CCSR includes the following members of the Corporation:
Mariano-Florentino (Tino) Cuéllar
William Lee (Chair)
The ACSR includes four faculty, four students, and four alumni. Faculty and student membership is rotated among the schools.
- Corporate Political Spending
- Environmental Issues
- Executive Compensation
- Human Rights
- Corporate Political Spending
Committees on Shareholder Responsibility
17 Quincy Street
Cambridge, MA 02138