The University will now use its power as a shareholder to encourage technology companies to crack down on conflict minerals.
On Friday, the Board of Trustees adopted a new proxy voting guideline for the institution’s investments. The guideline, proposed by Coalition for a Conflict-Free Duke, stipulates that DUMAC—the firm that manages investments for the Duke University Endowment—support shareholder resolutions that call for reports on the policies and efforts of companies regarding their avoidance of conflict minerals.
Duke will be the second university to pass a shareholder resolution regarding conflict mineral trade, following Stanford University in 2010.
“It’s always difficult to be the first person to start a movement, but at times it is more difficult to be the first time to follow,” said junior Stefani Jones, founding member and chair of the CCFD board. “It’s a meaningful step that demonstrates Duke’s leadership and... willingness to think about human rights and social justice in a tangible way.”
Conflict minerals—mined from conflict-stricken areas—are often found in electronic consumer products. In the Democratic Republic of Congo, armed forces use profits from mining minerals like cassiterite and wolframite to control populations and perpetuate the ongoing conflict, said senior Sanjay Kishore, president of the Duke Partnership for Service and board member of CCFD.
A multi-step process
In order for the Board to approve any proposal regarding the control of investment practices, the proposal must pass through two committees—the President’s Special Committee on Investment Responsibility and the Advisory Committee on Investment Responsibility. The ACIR and PSC are University bodies formed in 2004 after the Board adopted a policy on socially responsible investing.
The PSC unanimously supported the conflict minerals proposal in January and the ACIR approved it unanimously in April 26.
“What we concluded was that there was a considered course of action that Duke should take... and there needed to be a continuous process of learning about this complex problem,” said ACIR Chair Jonathan Wiener, William R. and Thomas L. Perkins professor of law.
In a 137-page report compiled by the ACIR, the committee noted some concerns raised by its members, including unintended consequences resulting from the proxy voting guideline.
Measures to encourage companies to report on or avoid the use of conflict minerals, Wiener noted, could unintentionally result in reducing the use of all minerals from central Africa, causing economic distress for already impoverished populations.
After ACIR approval, the proposal went to President Brodhead and the Trustees in June. The Board resolution in favor of the proposal stipulates that the PSC review the adopted policy and its implications in five years.
Kishore said the timing of the passage of the proxy voting guideline is important because interest in the issue has waned since the initial stirring of the national conflict-free mineral movement.
“It’s more important now than ever for students and consumers to take their step forward—this is a great entry point for students,” Jones said.
Students of CCFD are hopeful that other universities will follow suit.
‘The power of students’
The CCFD received much aid from similar movements at national institutions, Kishore said. Duke’s success in following through with the resolution and enacting change on campus has proven that the model initiated at Stanford can be replicated, he added.
Both Kishore and Wiener said the passage of the proxy voting guideline is in line with the University’s engagement in issues of socially responsible investing and service, noting in particular Duke’s involvement in the national movement in the late ’90s to ensure that branded apparel sold in university stores were not produced in sweatshops.
“It speaks well about the power of students... to provide and act on knowledge in the service of society by putting together a challenging problem and complex options in a careful and considered manner,” Wiener said.
The approval pathway for presenting a proposal to the Trustees is not as publicized as it should be, Jones said. If more student groups knew about the procedure, more important issues would be brought to the attention of administrators.
The ACIR had not met to review a proposal for five years before the conflict minerals meeting, Wiener said.
Jones added that although there were “many hoops to jump through,” the multiple committees that comprise the approval process are necessary to ensure that student groups are prepared. In the wake of the proposal’s approval, Jones and Kishore hope to bring the issue to the attention of local and state administrators.
“A lot of work needs to be done outside the Duke walls and we hope that the University will use its influence to enact change at the state level and eventually develop partnerships with companies as well,” Jones said.
In December, Jones and CCFD members reached beyond the campus walls when they posted a Facebook video appealing to Apple CEO Tim Cook, who graduated from the Fuqua School of Business in 1988. The video urged Cook to produce conflict- free Apple products. It was picked up by the Huffington Post in January.
Shortly after publishing the video, Jones received word from Apple acknowledging the University’s efforts toward relieving the conflict minerals issue. Apple has not contacted CCFD since.
“With this huge step, [CCFD] will reach out to Tim Cook again and hopefully convey to him how important this issue is being taken up at his alma mater,” she said. “It should show him that this is a topic that is definitely worth noting.”