The University of California has sold approximately $25 million worth of investment stocks from private prison corporations — the Corrections Corporation of America (CCA), Geocorp and G4S. This decision was made on Dec. 1 after UC administrators met with students from the Afrikan Black Coalition (ABC) student advocacy group, who campaigned against these investments throughout 2015.
Kate Moser, a media representative for the UC, stated that this decision came after the UC system’s Chief Investment Officer Jagdeep Singh, who met with the students, determined that its stock was not a good investment in the long-term. “From a risk perspective, this made sense given our conclusion that, based on risk over the next several years, these holdings were not a good investment for a long-term investor such as UC,” Moser explained.
According to Moser, the UC does not have a blanket policy to forbid investment in certain companies, stating, “Instead, we evaluate our investment opportunities from a risk perspective. Many factors figure into this perspective, such as whether social, governance, or environmental issues make the asset too risky over the long-term.”
Private prison corporations have come under controversy by student advocacy groups who believe that the prison system has had adverse effects on minority communities. The National Association for the Advancement of Colored People (NAACP) cites that “African Americans now constitute nearly 1 million of the total 2.3 million incarcerated population (approximately 43 percent),” despite making up only 12 percent of the population in the U.S.
“These demonstrations display that student activism is a powerful tool when utilized properly. Also, the UC’s divestment from private prisons (sic) reinvigorate the ideology that students can make ‘real and legitimate change,” Alex Wilson, a fourth-year history major and member of ABC at UCR, stated.
Others, such as UCLA Finance Professor Ivo Welch, were critical of this decision, stating to the LA Times, “If you start going down the list of Fortune 500 companies, I’m sure we can come up with reasons we should divest from each one. I’m almost left speechless by how we pamper student whims.”
Kamiah Moore, a field organizer for ABC, contends that despite this victory, divestment from private prisons is still not complete. “In order for the UC’s mission to be fulfilled, it is imperative to assess investments not only from a risk perspective, but from a socially responsible perspective as well. Our campaign is not over. We will continue to call for complete divestment, increased transparency, and reinvestment in education and businesses owned or controlled by the formerly incarcerated,” Moore elaborated.
ABC is now looking for the UC to divest approximately $425 million from Wells Fargo Bank, citing discriminatory lending practices and its investment in private prisons. “Wells Fargo also acts as a syndication agent and issuing lender on CCA’s $900 million line of credit, serves as a trustee to Geo Group’s $300 million corporate debt, and is a Million Shares Club member,” Anthony Williams a media representative for ABC stated in a press release.
“As a Million Shares Club member, Wells Fargo owns over one million shares in CCA and Geo Group, effectively financing the dehumanization of Black and migrant people,” Williams elucidated. “Unless Wells Fargo immediately cancels all of its business relationships with private prisons, the $425 million the UC has invested in Wells Fargo must be divested immediately.”
Alex Wilson is a contributing writer for the Highlander