Occidental College in Los Angeles took a new approach in traditional college investment policies, announcing in February that the college would no longer be investing in firearm companies. The college’s board of trustees made this decision in response to recent gun violence on school campuses.
This type of social movement is atypical for universities, and Senior Vice President of Investments and Chief Investment Officer of Pepperdine Jeff Pippin said it is highly unlikely that Pepperdine would follow Occidental down a similar path.
“There have been no selected causes picked out to say we are going to prohibit this and prohibit that,” Pippin said. “The basic role of the board is to promote the mission of the university. If you are making an investment that two basic people could disagree on, and it costs Pepperdine University some money if the company ends up doing well, one might question whether the decision to boycott that company was in the best interest of Pepperdine.”
Pippin said there has never been a controversy over taking a social stance on investments at Pepperdine. “We have no particular social issues that are part of our investment policy,” Pippin said. “That doesn’t mean that as individuals we don’t support certain causes. Our university doesn’t have a coordinated policy because it hasn’t been an issue. Very few endowments have a policy that would have social implementations.”
Since Pepperdine is a 501c3 nontaxable, tax-free entity, Pippin said the goal of Pepperdine’s Board of Trustees is to make sure the resources are invested and employed in a way that best ensures that the Pepperdine mission is accomplished.
“Basically, we are a charity,” Pippin said. “The board’s duty is to earn the best risk-adjusted investments based on standards that have been employed by top quality companies.”
Most of the companies that Pepperdine makes investments in – there are thousands according to Pippin – are mainstream and recognizable to the common consumer. For this reason, Pepperdine has steered clear from any companies that would cause concern.
“On a selective basis, there may be an instance where we might look at a company and say, ‘No, we don’t want to get involved in that,’ but that hasn’t really happened,” Pippin said.
Investments are made in stocks, bonds, real estate, private assets, inter-capital start-up businesses and more, according to Pippin.
“The companies that Pepperdine invests in range from technology to consumer retail companies, to industrial, to manufacturing in U.S., Europe, Asia and emerging markets,” Pippin said. “We are trying to diversify the types of investments that we make.”
Though the board may feel that social issues don’t have a place in investments, some students on campus said they think otherwise. Freshman Rachelle Holdridge said she doesn’t agree with Occidental’s firearm company boycott, but she respects that the college stood up for a cause.
“I feel like we should make investments that align with Pepperdine’s mission statement,” Holdridge said.
Junior Karolina Keach said although there isn’t an issue in particular she would expect Pepperdine to take a stance against, she would hope that the board would consider students’ opinions when making decisions.
“I’ve never really thought about it, but I think Pepperdine should take a stance on social issues,” Keach said. “What do the majority of the students think? If we were to take a vote, I think they should make an action depending on what the majority of students believe.”
Freshman Mike Burton said he believes Pepperdine’s investments should uphold Christian policies, whatever that entails.
“Any company that violates those premises I think Pepperdine would have to boycott,” Burton said.
Regardless, Pippin said the board feels it is best to keep social issues out of investment decisions.
“There are certain issues that as individuals we may like to stand against, but I would argue that boycotting a company is not the best way to do it,” Pippin said. “Once you start going down that road, where does it end?”
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