You may be familiar with the practice of “land-grabbing,” as it has recently gotten a fair amount of coverage in the mainstream media. However, the media has primarily focused on China and India buying up land in Africa, and not so much attention has been paid to American businesses and even universities doing the same.
Yes, universities. As a society, we've been slow to recognize that because they invest sizable endowments, many institutions of higher education function as important players in global financial markets. Unfortunately, university investment decisions are often based strictly on profit maximization without concern for the environmental damage, human rights violations or other adverse impacts caused by the entities or activities that these investments fund.
You may remember one of the most prominent social movements of our time—the pressuring of universities to divest from South Africa over apartheid. Now, university investments are once again perpetuating injustice in Africa. Major American universities - including Harvard and Vanderbilt - are working through British hedge funds and European financial speculators to buy or lease huge tracts of African farmland in deals that will likely result in displacement of small farmers, environmental devastation, water loss and the further impoverishment and political destabilization of these developing nations.
Here’s how it works: Investors buy up land from African governments (at ridiculously low prices, as low as 25 cents an acre) with the purpose of growing commodity crops—often genetically modified and often for biofuel—primarily for export to Western countries. These investment companies often claim to be investing sustainably and even improving food security. However, a growing body of research debunks those claims and even suggests that these investments are making the global food crisis worse. While investors claim to be setting up businesses and creating jobs on unused parcels of land, these deals often force large numbers of people to relocate, including small farmers who rely on the land to feed their families and local communities. Though it flies in the face of agribiz’s self-serving contentions, converting small farms and forests into natural-asset-based, high-return investments drives up food prices and increases the risk of climate change.
I spoke with Martin Bourqui of the Responsible Endowments Coalition, a nonprofit group that fosters social and environmental justice by transforming the way universities invest by empowering students, administrators, trustees and alumni to help their institutions of higher education invest more responsibly. Below, Martin explains how the system works—and how you can change it.
For an extensive report on the reality of African land grabs, read the Oakland Institute’s Special Investigation: Understanding Land Investment Deals in Africa.
So land grabs—what are they?
I think a precise definition is less important than looking at the situation holistically, since one person’s land grab is apparently just another business deal for many of the people who manage large sums of money. We have London-based asset managers investing in some of the most fertile, choice land in parts of Africa, and then making a profit off of that land. U.S. universities are investing in these funds and in doing so are also making a profit - or perhaps I should say, "making returns on their endowment," since universities are actually still considered not-for-profit, taxpayer-subsidized institutions. Considering that these investors are making 25% returns, it’s no surprise that they're eager to label this as an investment handled "responsibly." Unsurprisingly, according to the Oakland Institute’s new report, it seems that buying huge tracts of the best land in very poor countries and forcing people to move so that the rich can profit off of it may be just as bad an idea as the title of 'land grab' would indicate.
What are the dangers of land grabs?
I do not purport to speak for those who are affected most by this - the farmers and landowners on the ground - and I believe strongly that theirs are the voices that should be lifted up in this discourse.
I will say that there are clearly problems with this sort of way of making a dollar. This touches on a number of problems inherent in our globalized marketplace and the way in which those with the least are exploited the most. The dimension of neocolonialism alone is disturbing. Are we really watching, more than half a century after the African independence movement, London-based businessmen taking land from African farmers? Does the mind not rebel at any point in the process, that this can be "business as usual" in the 21st century?
There is also a more fundamental set of issues relating to self-determination and the rights of people to take power over their local economies. For people half a world away to be determining how land is used - what is farmed, how the land is treated, who oversees the process, how it is mapped out - it will inevitably have enormous political, societal and ecological ramifications.
How many universities do this—and do we even know?
The outrageous truth of university finance is that most of our institutions of higher education are invested in almost everything, including in the worst of the worst.
The vast majority of colleges and universities in the U.S. - and investors in general - invest purely for maximum returns, with no environmental, social or governance (ESG) factors taken into account. Investment officers at major institutions deny responsibility, citing that the larger systems of investment finance dictate that they have to make their goals, or "benchmarks," of how much money they are required to make. Our Boards of Trustees that make up the highest rungs of university decision-making are, for the most part, similarly unwilling to realize that the financial system as it stands is unsustainable. They earned their credentials in the pro-deregulation, "Greed is Good" culture of the 1980s and 1990s, and many of them see no cognitive dissonance in Harvard, Yale, Stanford and virtually all (yes, virtually all) of the rest invested in companies that practice slave labor conditions, that own private prisons, that practice environmental destruction in the tar sands of Alberta, you name it.
If you care, and you attend or attended college, it is your responsibility as a student or alum to speak up and say that you care. If enough of us do so, they will listen!
Are any universities taking actions to divest from these land grabs?
Unfortunately not. Almost all universities are invested in outrageous things like this, and just consider it part of doing business. Most are too afraid to even speak up and say they're doing anything about it even if they want to, because they're afraid it'll just attract more attention to the fact that our schools hold a collective $350 billion and nobody knows where any of it is going. But it’s about time we blew the lid off of this story!
We are at the very early stages of beginning to see a cultural shift. There are leaders like the University of Louisville in Kentucky where the administration is actually trying to do the right thing without the students having to organize and petition and deal with intentionally constructed roadblocks (like byzantine committee structures) just to have a conversation about these issues. We're beginning to see some forward-thinking administrations and schools actually willing to take action, and that’s encouraging.
Most schools, however, are falling far behind, and major problems of transparency and accountability are front and center. Why do universities not reveal much of anything about where they're invested? They claim it’s because if they reveal their investments, their special investment "strategies" will be poached by their competitors. This is, quite simply, a fantasy. Most universities of similar statures and wealth are invested in the exact same stuff. The real reason why universities don’t open the books is because students and alumni will have to face the fact that they're invested in the worst of the worst - when they simply don’t have to be - and they don’t want that controversy damaging their sterling reputations. This debate also intersects with the question of "ownership" of the endowment and whom the university is accountable to. If my university is a nonprofit institution, being subsidized heavily by taxpayers, and its endowment is made up of alumni gifts, then I see the endowment as very much something that all students, alumni and taxpaying community members have a stake in.
What can students do to get involved?
There is so much that each and every one of us can do! The biggest misconception people have is that you need to have sophisticated knowledge of finance to engage on these issues. You don’t. Students can and must feel empowered to say that our universities should be reflecting our values -- it’s not their job to be experts in finance. Don’t let anyone ever tell you otherwise.
Broadly speaking, students need to constantly hold their universities accountable to their mission statements, the values of the community (inclusiveness, sustainability, diversity, respect for different cultures) and to the concerns of the current and future alumni whose donations are the lifeblood of the school. There is so much good work to be done everywhere. This can and must happen both within existing power structures, if they exist, and outside of them. This can mean setting up and serving on committees on investor responsibility (CIRs), raising awareness, petitioning, getting alumni, prospective students and parents involved, you name it.
The Responsible Endowments Coalition was founded by five undergraduates working to change the way their universities invest, and we've been supporting students and other university community members doing this important work since 2003. We have a wide variety of resources available to help students get involved, and my full-time job is giving advice, support and feedback to students!
If you're an alum, there’s plenty you can do, too. Write to your schools and explain why you don’t feel comfortable giving when you don’t know whether the money is going to things like these land grabs. Get five of your friends to do the same. Speak up about it at your local alum fundraiser -- you don’t have to crash the party, but you most certainly have a right to voice your concerns. Schools live for alumni giving - if alumni speak up, the schools will be forced to adapt to their wishes.
Why is student activism important?
At my alma mater, Tufts University, there’s a framed photograph of a student protest against the school’s investment in South Africa in the 1980s hanging in our library. They're celebrating that divestment now, but I'll bet you all the money in my pocket that the school resisted those efforts as long as it could back then. Those who will be regarded as the moral leaders twenty years from now are those who are pushing back against the existing power structures today. It’s never too late to get involved.
I've studied the history of investment-related activism in higher education, and here’s the simple truth: universities will not change their investment policies unless their community demands that they do so. Universities didn’t divest from apartheid South Africa because some college president thought it would be a good idea, or because some benevolent investment officer read something in the New Yorker that made them think. (Although I'm sure they did, and failed to believe they could act on it.) No. Schools divested because students organized, and were visible, and said, "Hey, this stuff flies in the face of our values and the values of our schools." And the schools, in turn, realized that their reputations - their ultimate currency - were at stake. Only then did they do the right thing. It was exactly the same with the divestment movement from the Sudanese genocide in the early-to-mid 2000s. We all want our schools, which claim to be "a light to the world" and "fostering global citizenship" and all of that, to wake up and realize that they have a role to play. But unfortunately, our schools must be held accountable, time and time again, or the change we need to see won’t happen. And believe me, it will take more than asking nicely.
It really is students that make it happen, much more so than other constituencies. Faculty are silenced and fearful for the stability of the scarce jobs that exist. Low- and mid-level staff members at most universities are no longer unionized and don’t feel like they have a voice either. Alumni hold a huge amount of power as the donors to the school, but they are far-flung, busy and harder to organize. At the end of the day, it’s the students who will get this done -- the ones who have the power and the privilege to be able to speak up, to be visible, to say, “We will make this happen, and we will not leave until you make this change.”
If you can be brave and vulnerable enough to take action in the face of uncertainty and complexity, that’s real leadership. This is the future of finance, and it’s about time we brought our universities up to speed.
For students and alumni who want information on how to get involved at your university, contact the Responsible Endowments Coalition.
For more information on land grabs and what you can do, visit Oxfam International.