Back in 1998, Mark Yusko came to UNC to head up the the endowment. He was brought in because, he said, former Chancellor Michael Hooker “was tired of losing every year to Duke. Not in basketball or football but investing.” When he tore into the position with the idea of transitioning from traditional stocks and bonds to energy investments, he encountered firm resistance from University administrators.
After a few years of operating the fund within the confines of the bureaucracy, he distanced the endowment from the University administration, creating the UNC Management Company in 2002. The nonprofit fund manages UNC-Chapel Hill’s endowment and the $4.5 billion fund that represents all schools in the UNC system.
UNC Management Company releases end-of-year reports, detailing the industries it invests in. But, notably, the reports include no details about specific companies or regional distribution of investments. While this may be standard practice for private universities and organizations, we expect and need more from our public institution.
And that’s because we all have a stake in how this money is invested. With a public university supported by our state legislature, North Carolinians should know what our UNC system invests its money in.
Recently, a few cautionary tales have shed light on what can happen when these university funds are not transparent. A 2015 investigation into the public endowments for public universities in Texas (University of Texas and Texas A&M University) revealed that the Permanent University Fund invested in 10 companies that promoted or supported genocidal campaigns in Darfur and 14 companies companies that worked with the government of Iran to commit human rights abuses.
This public investigation, led by Texas A&M’s student newspaper, led the managers of the Texas fund to quietly divest millions of dollars from the organizations found to have violated human rights in Sudan and Iran.
But while we celebrate the power of this student journalism in this case to bring truth to light, we cannot also help but wonder: Could it happen here? Is it possible that any of the companies that receive some of our $4.5 billion investment are conducting business with similarly destructive human rights violations?
Right now, without any level of transparency from this closed-off fund, we have no way to tell you that our University’s fund is invested ethically.
While we welcome continued efforts for UNC’s fund to focus on environmentally responsible companies, we also believe that we need a more fundamental shift in the way that this fund interacts with our community. We need transparency — we need to know what companies, what mission statements, and what overseas businesses our University profits from every year.