The Milwaukee Sentinel
December 5, 2003
By Nahal Toosi
Madison - In a rare and symbolic move, the regents of the University of Wisconsin System have decided to divest their trust fund of $201,000 worth of bonds in Tyson Foods, the company mired in a months-long labor controversy in Jefferson.
While UW System officials have long listened to social concerns about the companies they invest in, it's very rare that the system divests for reasons unrelated to finance.
The last time it happened was in the late 1970s, when universities nationwide started to divest in companies that did business in apartheid-era South Africa, UW officials said. The UW dropped investments in those companies from 1978 to 1994, said Doug Hoerr, the system's assistant trust officer.
The system's trust fund has no other Tyson holdings and will not be purchasing any for the time being, Hoerr said. "It's a statement, the divestment," Hoerr said. "Obviously, it's not a huge financial impact on the company."
Not that any of the regents interviewed were publicly willing to criticize Tyson, a $24 billion meat processor, Friday. One regent criticized the decision to divest.
In fact, when the business and finance committee announced the decision to the full board Friday, there was no discussion on the topic. The move does not require full board approval and, according to a report prepared for the committee, won't cost the system money.
"We're not violating our fiduciary responsibility," said Deborah Durcan, UW System vice president for finance.
Regent Vice President David Walsh, a member of the committee that approved the divestment, said the decision was not an attempt to take sides in the months-long labor dispute involving Tyson and the United Food and Commercial Workers Local 538.
More than 400 workers at the sausage plant in Jefferson have been on strike since Feb. 28, and the company has turned to replacement workers.
Instead, Walsh said, the committee was merely showing support for recent decisions by UW-Madison and UW-Milwaukee to stop purchasing Tyson products until the labor dispute is resolved. Those two universities made the decisions after getting pressure from students and other activists in their communities.
The chairman of the committee, Regent Mark Bradley, agreed that the decision was primarily a show of support for the two universities. But he also said he was impressed by comments made on the Tyson issue by people who spoke at an annual forum held last month on the system's investment practices.
Bradley is one of nine new regents on the board, all of whom have started serving on the 17-member body this year and most of whom were directly appointed by Democratic Gov. Jim Doyle. The board had long been stocked with appointments by former governors Tommy G. Thompson and Scott McCallum, both Republicans.
Tyson spokesman Ed Nicholson declined to criticize the regents on Friday but wondered whether the company's views had been accurately and adequately represented.
Meanwhile, Mike Rice, president of Local 538, said the UW decision would boost the morale of the striking workers.
Regent Fred Mohs, who had apparently stepped out of the meeting when the subject of Tyson came up, reacted in dismay to the decision when a reporter told him about it afterward.
"I think it's inappropriate," said Mohs, a Thompson appointee. "If they did it because Tyson was involved in a labor dispute, I think it's inappropriate for a university to take sides in a labor dispute. I think we should be maximizing our income for all the good we can do with it."
The system also is looking through its investments in companies that do business in Myanmar, also known as Burma, and expects to have a report and discussion on socially responsible investing practices in February. In the past, UW campuses have also been asked to divest from companies that do business in Israel.
Also Friday, the full board approved two final pieces of a plan to ease transfer of credits between the state's technical colleges and UW campuses.
From the Dec. 6, 2003 edition of the Milwaukee Journal Sentinel