Yale was one of the first institutions to address formally the ethical responsibilities of institutional investors. In 1969 Professors John Simon, James Tobin, William Brainard, and Charles Lindbloom along with Yale graduate students Charles Powers and Jon Gunnemann conducted a seminar entitled “Yale’s Investments,” which explored the ethical, economic, and legal implications of institutional investments. As a result of the seminar, Messrs. Simon, Powers, and Gunnemann wrote The Ethical Investor: Universities and Corporate Responsibility. Published in March 1972 by Yale University Press, the book established criteria and procedures by which a university could respond to requests from members of its community to consider factors in addition to economic return when making investment decisions and exercising rights as shareholder.
The Yale Corporation adopted the guidelines outlined in The Ethical Investor in April 1972 and Yale became, according to the New York Times, “the first major university to resolve this issue by abandoning the role of passive institutional investor.” The book subsequently served as a blueprint for the ethical polices of a number of universities.
In the 1972-3 academic year, as suggested in The Ethical Investor, Yale established the Advisory Committee on Investor Responsibility (ACIR). The inaugural committee addressed social responsibility issues ranging from company investment in South Africa, to defense contracting, political lobbying and environmental safety. Later the Yale Corporation formed the Corporation Committee on Investor Responsibility (CCIR).
The CCIR is composed of Fellows of the Corporation. It recommends policy to the full Corporation and is charged with implementing approved policy. In discharging its responsibility, the CCIR is assisted by the ACIR. The ACIR is composed of two students (one undergraduate and one graduate), two alumni, two faculty, and two staff members.