Exerpts from Report On Investment Plans

(The following exerpts from Report On Investment Plans

are taken from the Austin Committee's report on University Relations with Corporate Enterprise:)

"The Abstraction that we call the University is certainly real enough to have an obligation to be a good corporate citizen of the community in which it lives.

"The University in its role as initial investor, should strive fundamentally for maximum return. Not only would any other policy embark the University on uncharted seas; maximization of return is a matter of sheer necessity in this era of spiraling costs that may threaten the very existence of the private university as we know it.

"Investment parity turns out to be an elusive ideal: almost any corporation might be found to be engaged in some activity that some would consider deleterious to the public welfare.

"When the University is already a stockholder, it need not remain passive in the face of substantial evidence thatthe company is acting in an antisocial way. That is to say, once the University has taken a particular corporate plunge, choice in a sense becomes inescapable; for it is a truism in the financial world that abstention in a proxy contest is a vote for the management."

"The University should not go so far as to litigate or solicit proxies itself in favor of a policy that is considered to be socially desirable; nor should it join forces with other large, tax-exempt organizations in policing the conduct of business corporations.

"Certainly the University should vote its stock on occasion in favor of change for the symbolic effect of a great university's taking a position in a social problem.

"We are inclined to the view that the creation of a new Faculty (for social research) would foster a greater sense of commitment on a University-wide basis, and would elicit greater support from all segments of society than could another Institute or Center."