Penn Rejects Divestment of Tobacco Company Stock

June 23, 2014

The University of Pennsylvania board on Friday rejected a proposal that it sell endowment holdings in tobacco companies, as faculty and student groups have urged. A statement from David L. Cohen, Penn's board chair, noted that the university has established criteria for divestment, and Cohen said that tobacco did not meet a key criterion: being morally evil. "After thorough deliberation, the board has determined that the tobacco proposal does not meet the criterion of establishing that there exists a moral evil," the statement said. "The linchpin of any divestment decision at Penn rests on the interpretation of moral evil, which we would view as an activity such as genocide or apartheid. We fully appreciate and understand the concerns that were raised by those who advocate divestment, and we recognize that reasonable people may disagree on this issue. Nonetheless, it is the carefully considered judgment of the board that the manufacture and sale of tobacco products – which is widely accepted as legal, although significantly regulated, in this country – does not qualify as a moral evil." Cohen did say that the university would not seek to add tobacco holdings and that it would use its influence in companies in which it invests to promote responsible policies.

Chris Feudtner, a professor of medical ethics who has helped advocate for divestment, had this reaction via email: "Open and vigorous debate can lead to positive change. Today the trustees of the university took action to prospectively divest from tobacco holding, to use what holdings it retains to advocate for the cessation of tobacco marketing to minors and the curtailment of marketing in the developing world, and to avow the university's commitment to improving the health of individuals and the public by diminishing the harm caused by tobacco. While these steps do not constitute total divestment, they represent a victory for better aligning our institutional values and actions."

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