THE FINANCIAL IMPLICATIONS OF DIVESTMENT: A REVIEW OF THE EVIDENCE

Contents: INTRODUCTION • PART I. FINANCIAL IMPACT OF DIVESTMENT • The State of Massachusetts • The State of Connecticut • Michigan State University • The State of Ohio Pension Fund • The District of Columbia • The State of Nebraska • PART II. APPROACHES TO DIVESTMENT • Substantial Investment • Strategic Involvement • Bank Loans to South Africa • PART III. SOUTH AFRICA AND THE DIVESTMENT CAMPAIGN • Decoding the Sullivan Principles • APPENDIX • APPENDIX B STATE OF CONNECTICUT PORTFOLIO ANALYSIS • APPENDIX C • APPENDIX D • TABLE INDEX • TABLE I Projected Performance of South Africa Related Massachusetts Portfolio • TABLE II Summary of Stock Transactions - Connecticut • TABLE III Michigan State University Common Stock Sales • TABLE IV Michigan State University Stock Purchases • TABLE V Companies with Substantial Investment in South Africa • TABLE VI U.S. Private Bank Loan to South Africa • The report says a growing number of Americans have criticized the wisdom and morality of investing in the South African economy and profiting from apartheid. After the events in Soweto, the murder of Steve Biko, forced removals of some three million black Africans to the Bantustans, and South Africa's aggression of the front-line states, there is an increasing demand by religious institutions, universities and colleges, unions, and human rights groups to do something about U.S. investments that help prop up the South African regime. Those in favor of such action have proposed a strategy of "divestment" to pressure companies and banks to withdraw from South Africa. The report discusses "constructive engagement," the Reagan Administration, the New World Foundation, alternative investment options, investment of public funds in companies in South Africa, legislation, General Motors (GM), BankAmerica Corporation, Citizen Southern Bank, Crocker National Bank, First Chicago Corp., Harris Trust and Savings, Maryland National Bank, First Interstate Bank, Central National Bank of Cleveland, Citicorp, Continental Illinois, Fidelecor, First City Bancorporation-Texas, Manufacturers Hanover Trust, Philadelphia National Bank, Franklin Research and Development Corporation, Abbot Laboratories, Dow Chemical, Caterpillar, Ford Motor, Exxon, DuPont, Pfizer, Union Carbide, Xerox, BankAmerica, Chemical Bank, Manufacturers Hanover, Crocker National Bank, Wells Fargo, Citibank, Bankers Trust, the United States Trust Company, Connecticut public investment law, strategic products and services, the South African government, police, military, Baker International, Celanese, Loctite, Measurex, NCR, Nalco Chemical , A.C. Nielsen, Capital Management Sciences, Danies and Bell Capital Management Company, United States Trust Co., IBM, Public Employees Retirement System, the Police and Firemen's Disability and Pension Funds, the School Employees Retirement System, the State Teachers Retirement System, the Highway Patrol Retirement System, stock and bond trading, Goodyear Tire and Rubber, AT&T, socially responsible investment, legislators, pension fund managers, U.S. corporate policy, limited voting rights, Coloreds, Asians, the black majority, economic, political, military and cultural ties, Mobil Oil, Caltex (SOCAL + Texaco), SOHIO (Kennecott), Newmont Mining Co., General Electric (GE), U.S. Steel, Phelps Dodge, Ingersoll-Rand, International Harvester, Control Data Corp., Dresser Industries, Fluor Corporation, coal-liquefaction plants, SASOL II, SASOL III, ITT, Eastman-Kodak, Hewlett-Packard, Motorola, Westinghouse, NCR, Burroughs, uranium, Allied Chemical Co., Bechtel, Gulf Oil, Arthur K. McKee, Superior Oil, Terradex Corp., Union Carbide, US Steel, Utah Mining, American Metal Climax, Interpace, Tektronix, Texas Nuclear, US Borax and Chemical CO., United Technologies, Koeberg Nuclear Power Plant, Babcock and Wilcox, Edlow International, Swuco, Combustion Engineering, Trans-Nuclear, Allis-Chalmers, Gulf General Atomic , US Nuclear Inc., Beckman Instruments, Picker International, Autoclave Engineers Inc., Kerr-McGee, Chase Manhattan Bank, European-American Banking Corp., First Pennsylvania Bank, Marine Midland, Sperry-Rand, Paine Webber, J.P. Morgan, Goldman Sachs, Lazard Freres and Co., North Carolina National Bank, Republic of New York, Security Pacific National Bank, Smith Barney, and Kidder, Peabody and Co.