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Into the Archives: Apartheid Divestment, part II

in Campus Journal/Columns/Into the Archives by

Last CJ issue, I wrote about an exchange between 1985 Swarthmore grad Perry Chang and then-president David Fraser about the college’s policy on divestment from Apartheid. This week, I’d like to dig a little into what that process actually looked like.

Before the college came to the decision to divest in 1986, it adhered to the “Sullivan Principles,” a set of rules enacted by an African-American minister Leon Sullivan on the board of General Motors. GM was one of the largest employers of black South-Africans in Apartheid South Africa. The principles, which were originally created in 1977 and slightly amended in 1984, were as follows:

  1. Non-segregation of the races in all eating, comfort, and work facilities.
  2. Equal and fair employment practices for all employees.
  3. Equal pay for all employees doing equal or comparable work for the same period of time.
  4. Initiation of and development of training programs that will prepare, in substantial numbers, blacks and other nonwhites for supervisory, administrative, clerical, and technical jobs.
  5. Increasing the number of blacks and other nonwhites in management and supervisory positions.
  6. Improving the quality of life for blacks and other nonwhites outside the work environment in such areas as housing, transportation, school, recreation, and health facilities.
  7. Working to eliminate laws and customs that impede social, economic, and political justice.

Eventually, however, the principles came under fire as perpetuating an inherently oppressive system, as opposed to ending it.

On December 7, 1985, 41 students and one member of the faculty sat-in on the the Board of Manager’s meeting to protest the college’s policy of continued investment in companies doing business in South Africa. In a Board of Managers document from March 3, 1986 — the day divestment was finally agreed-upon by the Board — titled “Background on Swarthmore College, Endowment and Divestment of South African-Related Stock” outlined the process of the college’s transition from the Sullivan principles to divestment.

“They ringed the room, made brief speeches and then sat on the floor. Board Chairman Eugene Lang told them that the meeting would not be conducted in their presence. Discussions failed to resolve the impasse, and at 12:30 p.m. the meeting was adjourned,” the document read.

On December 11, 1985, students conducted a similar sit-in, this time in president David Fraser’s office.

“At noon on Wednesday, December 11 , 1985, 6 students entered President David Fraser’s office for a sit-in, although the President was out of the country for three weeks. The students demanded total divestment of stocks in companies doing business in South Africa, increased efforts to recruit black students, increased efforts to recruit black faculty, and the appointment of black faculty to important committee and professional positions. Between 3 and 40 students rotated in the President’s office for the next nine days, leaving the office on December 19 around 3 p.m.,” the document continued.

From student, alumni, and social pressure — as exhibited by Chang’s letter and many others — the college eventually decided to pursue full divestment.

As of the day the college finally divested,  $42.5 million of the college’s $195 million endowment was invested in 41 companies doing a fraction of their business in South Africa. However, this number had been decreasing for a while.

“Under the direction of the Board of Managers, the College has monitored its investments since 1978. To date, Swarthmore has sold over $3 million of South African-related stock, in four separate divestments. ln each case, the Board advised its investment counselors to sell the stock because the companies involved did not convince the College that they were conforming to the Sullivan Principles, which set forth goals for the equal treatment of workers of all races,” the document continued.  

In a memo dated that same day, Vice President and Treasurer of the board Loren Hart announced the board’s decision to fully divest.

“At the meeting on Saturday, March 1, the Board of Managers decided to move toward total divestment of stock in companies which do business in South Africa following a plan to be presented at the May meeting of the Board. Since the plan is not yet developed, we cannot now estimate precisely the impact of divestment on the endowment and, hence, on endowment income available for next year’s budget,” Hart wrote.

Hart and other board members were concerned with the impact of divestment on the community as a whole.

“This uncertainty, combined with the Board’s considerable concern the large amount of endowment income we need to balance next year’s budget, has forced us to cut next year’s budget by $300,000 (1%) from the amount previously discussed,” Hart continued. “The cost is to be borne approximately equally by the whole community: from faculty and staff, in Iower than expected compensation; from students, in lower financial aid; in lower departmental budgets; and lower major maintenance expenditures.”

Indeed, while the decision to divest had much support, it was not without setbacks. According to a letter from Ken Landis ’48, former Vice President, by April of 1988 the college had lost $1,300,000 in its efforts to divest.

“If extrapolated, this would mean total divestment would cause the College to lose each year the price of building a new Performing Arts Center or twice the cost of running our financial aid program,” Landis wrote to 1982 alum Dana Lyons.

The college crafted a plan to manage the losses over time, but it also emphasized that the goal was not to extend the losses for generations.

“The Board has consístently expressed its concern that future generations at swarthmore not bear the costs from divesting. We now deduct 300,000 from the operating budget each year — to cover losses incurred by this process. Thus, it is the current students, parents, faculty, and staff who are shouldering the financial responsibility for the change,” Landis wrote in another letter in 1989 to two alums.

It’s true, the students of the time did shoulder the financial responsibility for the charge. But they did also enjoy the moral responsibility of pressuring their own institution to help undermine an explicitly racist regime. By 1991, a year after the college fully divested, Apartheid was over — at least in a codified sense.

Desmond Tutu said of Apartheid,

In South Africa, we could not have achieved our freedom and just peace without the help of people around the world, who through the use of non-violent means, such as boycotts and divestment, encouraged their governments and other corporate actors to reverse decades-long support for the Apartheid regime.”

That’s a legacy of which Swat should be proud of being a part. Sacrifices were made, from an institutional point of view; faculty and staff took pay cuts, financial aid took a hit, projects were not enacted. But the sacrifices did work, and the success of Apartheid divestment serves as a reminder that collective action and institutional accountability is not only possible, but powerful.

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