Policy on Divestment from the Endowment

The Art Institute of Chicago is comprised of a world-renowned art museum and one of the country’s leading schools of art and design.  Broadly speaking, therefore, the Art Institute’s purpose is to promote art and design through scholarship, displays and exhibitions, research, education, publications, and community engagement.  While individual members of the Art Institute community may have opinions on social and political issues, it is neither the mission nor the priority of the Art Institute as an institution to take positions on such matters.  If anything, in fact, the Art Institute should remain silent so that individual staff, faculty, and students may engage in open discussion and debate without concern that the institution favors one view over another.  Institutional positions on political and social matters of the day risk suppressing the atmosphere of free inquiry and expression so important to both the museum and the school.  A healthy community of artists and scholars will have a diversity of viewpoints, and the institution’s role is to encourage and protect that diversity rather than to enter the discussion itself.

Given these principles, along with the fiduciary responsibility to maximize returns on investment consistent with appropriate levels of risk, the Art Institute maintains a strong presumption against divesting for social, moral, or political reasons.  This presumption may be overcome only in rare and extraordinary circumstances, where the activities of the company in question are in direct and significant conflict with a core value of the Art Institute or with the Art Institute’s very mission.  In determining whether the strong presumption against divestment is overcome, other factors that may be considered include the likelihood that divestment will affect the company’s activities and whether the identified concerns are better addressed outside of the investment arena (for example, through decisions on operating expenditures).

Process

Any member of the Art Institute community who seeks to have the Art Institute divest from a company must submit the request in writing to either the President of the School or the President and Director of the Museum.  The written request must explain how the company’s activities conflict with the mission or a core value of the Art Institute and provide supporting evidence.  The submission should also address whether divestment by the AIC will affect the company’s activities and whether there are other avenues that can address the identified concerns outside of the investment arena. The President of the School and the President and Director of the Museum will forward all such requests to the Management Committee, which currently consists of the two Presidents, the two Executive Vice Presidents, the School’s Provost, and the Museum’s Chief Operating Officer.  The Management Committee may consider the request on its face without any further investigation or it may take any steps it wishes to evaluate the request, such as consulting with others, conducting research, or asking the requesting party for additional information. It is up to the requesting party to establish that divestment is appropriate; the Management Committee is under no obligation to gather supplemental information.  

If the Management Committee determines after due review that the requester has not overcome the strong presumption against divestment, it will inform the requester that the request is denied.  Alternatively, if the Management Committee cannot reach agreement, believes the matter presents a close case requiring further review, or is persuaded that the strong presumption has been overcome, the Management Committee will forward the request to the Executive Committee of the Board of

Trustees for consideration.  The Management Committee will report all denied requests to the Executive Committee solely for information; denials by the Management Committee may not be appealed.  The Management Committee need not keep minutes of its meetings on divestment requests or issue a written explanation of its decision to the requester, but may do so if it so chooses. 

If the Management Committee refers a request to the Executive Committee, the Executive Committee will receive the original request, any supplemental information the Management Committee may have gathered, and an oral or written report from the Management Committee explaining why it forwarded the request for the Executive Committee’s consideration.  The Executive Committee may take any steps it deems necessary to evaluate the request before reaching a decision.

If the Executive Committee determines that the strong presumption against divestment has been overcome, it will direct the Management Committee to notify the requester of its decision and issue appropriate instructions to the Investment Committee to carry out the divestment.  If the Executive Committee determines that the strong presumption against divestment has not been overcome, it will direct the Management Committee to inform the requester that the request has been denied. 

Denials by the Executive Committee may not be appealed to any other Board committee or to the full Board of Trustees.  The Executive Committee may consider divestment requests in executive session without keeping minutes and need not issue a written explanation of its decision but may do so if it so chooses.  It is up to the Executive Committee to decide whether any report of divestment requests and decisions should be made to the Board of Governors and/or the Board of Trustees.

Adopted by the Executive Committee of the Board of Trustees, October 16, 2013.