University News

Advisory committee: Don’t reinvest in HEI

Staff Writer
Thursday, January 27, 2011

Brown’s Advisory Committee on Corporate Responsibility in Investment Policies recommended at its Dec. 6 meeting that the University not reinvest in HEI Hotels and Resorts.

ACCRIP cited “a persistent pattern of allegations involving the company’s treatment of workers and interference with their efforts to unionize, combined with repeated settlements” as the reason for its recommendation in a Dec. 7 letter to the Student Labor Alliance, which SLA has made available to the public.

Two years ago, students expressed concern to the committee about alleged mistreatment of workers at certain HEI hotels. Since then, SLA has held a number of protests, including a mock wedding ceremony between HEI and the University’s Investment Office. In March, President Ruth Simmons sent a letter to HEI stating that if the allegations were true, it would “be a matter of deep concern and contrary to our standards for investing.”

Brown has a 10-year investment in HEI that began in 2006, according to ACCRIP’s December 2008 minutes. The recommendation does not include any plans to divest from the current investment, only to refrain from reinvesting in the future.

This is still a victory, said Haley Kossek ’13, because the recommendation makes Brown “the first university to take this stance, that management interference in workers’ rights to organize is a reason not to invest.” Kossek is one of the two undergraduate representatives to ACCRIP, but she said she was speaking to The Herald solely in her capacity as a member of SLA.

ACCRIP, whose members include faculty, staff, alumni and undergraduate and graduate students, has made recommendations in the past to divest from tobacco companies and companies that profit from the genocide in Darfur, according to its website. The committee’s primary concern is “with the ethics of Brown’s investments,” said ACCRIP Chair Luiz Valente, associate professor of Portuguese and Brazilian studies and comparative literature.

The accusations against HEI include “discriminatory retaliation” against workers who attempt to organize to form a union, Kossek said. In an Oct. 27 guest column for The Herald, Kossek cited multiple instances of mistreatment at two HEI-owned hotels, Embassy Suites Irvine in Irvine, Calif., and Sheraton Crystal City in Arlington, Va.

The Sheraton Crystal City Hotel signed a settlement with the National Labor Relations Board in June, agreeing to hire back an employee who was allegedly fired for his involvement in a protest and to pay him $24,800 in back wages.

The agreement also required the hotel to post notices acknowledging their employees’ rights, including the right to organize or support a union without threats or disciplinary action.

The settlement included a non-admittance clause, stating that “by entering into this settlement agreement the charged party does not admit that it has violated the National Labor Relations Act.”

“We are not accusing HEI of doing anything illegal,” Valente said. He said there was “sufficient evidence” to justify not reinvesting, but declined to comment further. He added there is no clear line in determining what is ethical and what is unethical.

The Yale Advisory Committee on Investment Responsibility also looked into the issue, but found there was “not sufficient evidence of violation of our ethical investment norms,” said Jonathan Macey, chair of the committee and a professor at Yale Law School.

Yale’s ACIR, similar to ACCRIP, is made up of staff, students, faculty and alumni whose role is to advise Yale’s Corporation Committee on Investment Responsibility, according to Macey.

The standards used by ACIR are contained in “The Ethical Investor,” a guide written by Yale professors. Macey emphasized the need for “facts and evidence” before taking action.

Yale would only revisit the issue if ACCRIP’s recommendation was based on “any new facts or any new evidence,” Macey said, but Brown’s recommendation “appears to be based on the existence of complaints or allegations.”

HEI released a Jan. 7 statement “in response to inaccurate reports in the media regarding an investor in HEI Hotels and Resorts.” No investor has contacted HEI to change its investments, according to the statement. An HEI representative declined to comment further on the statement.

“Multiple false accusations are being made by certain union organizers as part of a larger publicity campaign to unionize our employees,” HEI said in the statement. The company also emphasized a commitment to workers’ rights and claimed “an employee satisfaction rating of 90 percent.”

ACCRIP’s recommendation states that the University should not reinvest “until the Corporation is confident that HEI adheres to our high standards regarding respectful and humane treatment of workers, and that workers at HEI-operated hotels are able to seek union representation without fear of intimidation.” Valente declined to comment on what specifically HEI would have to do differently.

“To me, a change in a positive direction would be HEI responding to those workers’ demands,” Kossek said.

The recommendation will be discussed at the next meeting of the Corporation’s Investment Committee, Simmons wrote in an e-mail to The Herald. She added that she is “hopeful that they will be favorably disposed to following ACCRIP’s recommendation and that we review HEI compliance” with the University’s standards on ethical investments before reinvesting.