Stonesifer Admits No Changes Planned to Gates Foundation Investment Strategy

As Idealog reported Thursday, CEO Patty Stonesifer of the Gates Foundation admits in an upcoming Los Angeles Times editorial that the Gates Foundation will not change its investment strategy:

It would be naive, Stonesifer said in a letter published today on the editorial page of the Los Angeles Times, to think that changing the foundation's investment practices could stop the human suffering blamed on the practices of companies in which it invests billions of dollars.

The text of her editorial has not yet been posted to the LA Times site but I can't wait to read it.

Patty, it would be naive to think that investing billions of dollars in corporations that cause public harm does not perpetuate human suffering.

I'll have a lot more to say about this soon.

Update:

Here is the LA Times link. It's just a letter to the editor:

In the recent coverage of the Bill & Melinda Gates Foundation's investments, The Times implies that we have made secret investments. We have always been open about the investments we make. Every corporate stock and bond we invest in is listed on our public tax forms, which are posted on our website going back to 2002. The stories you told of people who are suffering touched us all. But it is naive to suggest that an individual stockholder can stop that suffering. Changes in our investment practices would have little or no impact on these issues. While shareholder activism has worthwhile goals, we believe a much more direct way to help people is by making grants and working with other donors to improve health, reduce poverty and strengthen education. Bill and Melinda Gates have always reviewed investments and will continue to do so. To explain our philosophy and clarify how we make decisions, we have posted a statement on our website, gatesfoundation.org.

The LA Times' Charles Piller has published a new story to reflect the Gates Foundation's decision not to change their investment practices:

During the investigation and throughout a succession of statements last week, the foundation would not answer questions from The Times about its investment policies. ... The foundation's first statement on its website, written by Scott, said it would continue a regular review of its approach to investments, and added: "We will review other strategies that can fulfill a social responsibility role … [and] formalize the process by which Bill and Melinda Gates analyze and review these issues." The foundation's second website statement, also written by Scott, replaced the first. It said the foundation's investment team would enforce its regular investment exceptions, now limited to tobacco firms, and "consider whether there are other exceptions." In today's letter to the Los Angeles Times, however, Stonesifer said that none of this signaled a change in the foundation's practices.

Piller also says that there are apparent unaccounted for investments despite Stonesifer's claims:

She accused The Times of implying that the foundation had made "secret investments." "We have always been open about the investments we make," Stonesifer wrote. In an explanation of how it conducted its investigation, published along with its series, The Times said the foundation did not provide details for about $4.3 billion of investments it characterizes as loans. In a check of the foundation's financial statements, including its tax returns, The Times found no information about these loans, other than their amount.

Kristi Heim of the Seattle Times has also released another take on the Gates Foundation investment strategy: Gates Foundation faces multibillion-dollar dilemma.

Technorati Tags: bill gates, charles piller, gates foundation, stonesifer

Comments

[Dweep]

Jeff,
Were it not for your original post on Thursday, I would happily have blogged on how the Gates Foundation was embracing SRI, so thanks for pointing out the change.

Considering you are a fan of SRI (read your article on how you invest), I'd like to point out that SRI is not a no-brainer. It raises serious problems of its own - both ethical and practical - that are ignored by SRI proponents, given it is 'trendy' and easy. Perhaps my post on this specific case (see also previous commentary) will cause you to question SRI somewhat.
http://www.planetd.org/2007/01/13/gates-foundation-to-review-asset-investments/

IMHO, the Gateses should be commended for choosing which battles to fight.