The Harvard Corporation today (April 4) announced its decision to have Harvard Management Company divest its holdings of stock in PetroChina Company Limited.
“This decision reflects deep concerns about the grievous crisis that persists in the Darfur region of Sudan and about the extensive role of PetroChina’s closely affiliated parent company, China National Petroleum Corporation, as a leading partner of the Sudanese government in the production of oil in Sudan,” said the University’s Corporation Committee on Shareholder Responsibility (CCSR) in a statement endorsed by the Corporation. “Oil is a critical source of revenue and an asset of paramount strategic importance to the Sudanese government, which has been found to be complicit in what the U.S. Congress and U.S. State Department have termed ‘genocide’ in Darfur and what a United Nations commission of inquiry recently characterized as ‘crimes against humanity and war crimes . . . [that] may be no less serious and heinous than genocide.’”
The Corporation’s decision, on the recommendation of the CCSR, was made in light of advice from the University’s Advisory Committee on Shareholder Responsibility (ACSR), which comprises four faculty members, four students, and four alumni. At the request of President Lawrence H. Summers, the CCSR had asked the ACSR to study the issue, after concerns had been expressed by members of the Harvard community about PetroChina and the situation in Darfur. A subcommittee of the ACSR, after hearing from representatives of the group urging divestment from companies doing business with Sudan and otherwise inquiring into the circumstances, prepared a report recommending divestment from PetroChina. The full ACSR endorsed the subcommittee recommendation and forwarded the report to the CCSR, which in turn brought forward the recommendation to the Corporation.
“I want to thank the ACSR for its thoughtful consideration of these issues,” said Summers. “Divestment is not a step that Harvard takes lightly, but I believe there is a compelling case for action in these special circumstances, in light of the terrible situation still unfolding in Darfur and the leading role played by PetroChina’s parent company in the Sudanese oil industry, which is so important to the Sudanese regime.”
While affirming the strong institutional presumption against divesting stock for reasons unrelated to investment purposes, the Corporation accepted the recommendation that the extraordinary combination of circumstances presented in the case of PetroChina warrants the rare step of divestment.