Recently, when people think of investing, the mind conjures an image of power hungry Wall Street executives plotting to steal their homes. Arturo Jaras Watts ‘13 is trying to change this image from a malign one to a more peaceful one with his new student group, the Proactive Investment Club (PIC).
“PIC is a group that acknowledges that as individuals, we can be responsible for our finances, and [although] it will be a tiny bit of a difference, it would be a drop in the bucket,” said Jaras Watts. ”But if we can get institutions to invest responsibly then we’re talking about large scale and lasting change.”
Jaras Watts continued, “We believe it’s bigger than our campaign here at Fairfield University, because if we’re successful here to get Fairfield to change some of its practices, then nearby schools … may feel some kind of pressure to keep up and be ethically at the same level as other schools.”
According to Jaras Watts, getting the university to invest more humanely doesn’t simply mean divesting in those companies that engage in unethical business practices and investing in those with more commendable business models. Jaras Watts and his group strive to change things from the inside out using shareholder advocacy, which is an investment strategy that utilizes the power of stock ownership to enact social change within the company.
Watts continued, “One of the student government resolutions that we’re trying to pass is … firstly, for Fairfield to establish a committee on investor responsibility that will focus on this going forward… and secondly to engage in shareholder advocacy.” He added, “It really ought to be a responsibility for schools and large institutions to pay attention to what the companies they’re invested in are doing. “
Senior Michael Durand was sympathetic to the case, stating: “I think it may be a good idea depending on what the school invests its money in. I don’t know anything about what businesses the school does invest in, so I can’t really say, but if the businesses they are investing in have been affecting communities in a negative manner then someone should be responsible into looking at why that’s the case.”
However another student, Stephanie Kozinski, was more concerned with how this change would affect the university’s bottom line. “A lot of the ways these businesses get their money are unethical, and it would be nice if everyone would be more ethical,” she said. “But sometimes being ethical means less profit, not to be a downer.”
Jaras Watts had the foresight to expect this type of rebuttal and explained, “We want to stress that we acknowledge that none of us are as financially literate as some of the administrators probably are, and we want to work with them to find a mutually agreeable way of going about this.”
On top of tweaking Fairfield’s investment strategy, Jaras Watts would also like to see the university hold its money in smaller, community oriented credit unions, instead of large commercial banks. Credit unions are member-owned financial cooperatives, considered non-profit because the goal of their existence is to serve its members rather than maximizing profits.
Jaras Watts explained, “Credit unions … are not associated with the negative risky behavior that led to the financial collapse of 2008, but in addition to that they are specifically there to help alleviate poverty through providing financial services to those who wouldn’t traditionally get them.”
“Additionally we’d like to see community investment,” he continued. “A group of students at Fordham [University] … pressured their university to move $500,000 into community development credit unions in the Bronx. “
“Credit unions,” Jaras Watts explained, “make it so they can offer lower interest rates. They can make it easier for homeowners … the more capital there is available makes it easier for people to start small businesses nearby. “
Don’t be surprised if this new type of investment strategy seems unfamiliar to you, because it should. Only a handful of schools currently engage in this type of practice.
“Fairfield has the opportunity among the Jesuits to be one of the schools that are leading the way,” Jaras Watts explained. “Right now, Loyola, Chicago, Seattle University, in addition to Fordham University, are three Jesuit schools that have been involved heavily in this type of work. And of the 28 Jesuit schools across the country we have the opportunity to be breaking new ground.”
Jaras Watts made the point that he doesn’t want people to get the wrong idea about PIC. “People will associate us with finance, and investment, and business, and a lot of people will be bored,” he said. “But if you’re really getting a good idea of what we’re about it’s a social justice issue, and we’re just trying to take on a lot of the problems in the world through finance.”
“We want PIC to be a place where students with social & environmental justice concerns feel welcome regardless of the level of experience with responsible investment issues. We welcome new members and encourage anyone in the Fairfield University community to join,” he concluded.
Leave a Reply