MuseumDESCRIPTION:
Adam Sterling, director of Genocide Intervention Network’s Sudan Divestment Task Force, discusses the growing divestment movement, which received a boost with passage of the Sudan Accountability and Divestment Act (SADA).
TRANSCRIPT:
JERRY FOWLER: My guest today is Adam Sterling, Director of the Sudan Divestment Task Force, a project of the Genocide Intervention Network. Adam, welcome to the program.
ADAM STERLING: Thanks, Jerry. It’s an honor to be here today.
JERRY FOWLER: Well, it’s an honor for me to have you. You’re kind of celebrity now. I’ve been familiar with your work for quite some time, but you were recently featured in the film Darfur Now. And I was wondering has that changed your life at all?
ADAM STERLING: You know, beyond getting to know George Clooney and Angelina Jolie, it hasn’t changed my life too much. But it’s been a strange trip. I mean, this whole experience has been one surprise after another, you know, some good, some bad, but it was really unique to be a part of the film.
JERRY FOWLER: Have you had any experiences where people have recognized you on the street from having seen you in the film?
ADAM STERLING: Not yet. The film premiered at the Toronto Film Festival, and they had the big opening. And so throughout the weekend in Toronto I was stopped and recognized, but it hasn’t expanded beyond that yet.
JERRY FOWLER: Probably needs to go into DVD or something before ...
ADAM STERLING: Yeah. You know, maybe the next film will.
JERRY FOWLER: Well, the thing that is featured in Darfur Now and that, obviously, is the focus of your work is this campaign to get divestment from companies that do business in Sudan. And I think a very basic question that many people who listen to this show may know, but in case they don’t, is just what is divestment? What’s encompassed in this term?
ADAM STERLING: Sure. In its most general terms divestment describes an investor relationship. So as an investor you own shares in a company, and divestment means the selling of one’s shares. Most often divestment is done for purely financial reasons. A company’s performing poorly, so you sell your shares and buy shares in another company. Now, really, with the Sudan Divestment Campaign, we’re divesting for more of a social and moral reason, and we’re trying to change the behavior of a company. So the concept is that I have a problem with the actions of a company. The situation in Sudan is that these companies are supporting the Sudanese government and not supporting the marginalized populations that we’re trying to help. So basically I approach that company as a shareholder and I say, “I have a problem with what you’re doing, and if you don’t change your behavior I’m going to sell my shares in the company.” So that’s kind of-- in its most basic concept that’s what divestment is. Now, the larger campaign, and we’ve done this on a very large level, is looking at big investors, and some of the biggest in the world are state pension funds. For example, the two state pension funds in California have combined over $300 billion dollars worth of investments. So it’s a really powerful investor. So when they go and make those statements to companies there’s really a lot of weight behind it.
JERRY FOWLER: Because if I own one share that’s like a little piece of sand on the beach of this company, but the pension funds, other big institutions, mutual funds, they’ve got buckets of sand.
ADAM STERLING: Absolutely, and really, you know, as I’ve said the goal is to change company behavior and to use corporate leverage in Sudan to influence the situation in Darfur. And it’s really been remarkable. When we first started and, you know, a few universities had divested, you know, no one was taking us seriously. And, you know, now, we target about three dozen companies in Sudan and we’re in communication with almost all of them. I mean, they respond to our e-mails, to our phone calls. Since the campaign took off in 2005, nine major foreign companies in Sudan have either left, or have significantly changed their behavior in response to the divestment campaign. And that directly relates to the size of our investor constituency, you know, beyond having one individual, we’ve got thousands of individuals. We’ve got presidential candidates. We’ve got 22 states, 58 universities. And just recently about six months ago we sent one of our staff members to London. And so we’ve been working campaigns throughout Europe.
JERRY FOWLER: Well, walk me through, though, how this act of divestment, getting especially large institutions to divest, effects change on the ground in Darfur. What’s the connection between the investment or divestment decisions that individuals and groups can make in Europe and in the United States in stopping violence on the ground in Darfur?
ADAM STERLING: So I’m going to walk us backwards, start in Sudan and take us to one’s pocketbook. Sudan as a whole is a poor country. The average yearly income is around $650 dollars, yet the Sudanese government brings in billions of dollars a year in foreign investment, particularly in the oil industry. But they’ve got a foreign debt that exceeds their gross domestic product, so they actually owe more than they’re bringing in. So the question we ask is “if they’re getting all this money from these foreign companies, where’s it going?” And it turns out that most of that money is going to military spending, particularly in Darfur and other military campaigns throughout the region. Now, when we took a little closer look at the oil industry in Sudan, we found that you need three things to turn oil reserves into revenue. You actually need to have the reserves, which Sudan has plenty of. You need to have technical expertise; you have to know how to extract oil. And third, you have to have capital, or money, to invest in oil extraction, which is a pretty complicated and involved process. So Sudan, the Sudanese government has one of those three pieces, reserves, but they don’t have the capital or the expertise to extract their own oil. So they bring in these foreign oil companies. And there’s four big ones, or excuse me, three big ones, Oil and Natural Gas Company of India; China National Petroleum Company, or PetroChina of China; and Petronas of Malaysia. And then a bunch of oil field service companies that come in and either invest or basically do well pumping, or things like that. So we track, as I mentioned, about two to three dozen of these companies that we see as problematic. So Sudan relies on this foreign income, this investment in the oil sector. So we know that these companies have enormous leverage because without them in Sudan, they would have no money and they couldn’t fund the genocide in Darfur. So the question then is how do we influence these companies because we know they have enormous leverage over the Sudanese government? And if they said to Sudan, “Listen, your campaign in Darfur is killing the bottom line, we might pack up and leave,” Khartoum’s going to change. So taking a closer look at these companies we found that in order to raise the money, that capital that they need to extract oil in Sudan, they need access to western markets like the New York Stock Exchange or the London Stock Exchange. That’s how foreign companies raise money is by selling shares on stock exchanges. So then the question is let’s find big investors in those companies. Who provides them with that capital? Who can leverage these companies? And it turned out that it’s state pension funds, mutual funds, university endowments that have millions of dollars invested in these companies. So we’re going to use that leverage, the investments in these companies, to influence them to use their leverage in Sudan because really we haven’t found anyone that has the power that they do in the country and the power over the Sudanese government. So basically I send a message. I invest in a mutual fund and I tell my mutual fund company, “I’m really concerned about what this company, PetroChina, is doing in Sudan. And you as a mutual fund company – be it Fidelity, or American Funds – have billions of dollars invested in PetroChina, and I want you to send a message to PetroChina that what you’re doing in Sudan is wrong and the Sudanese government needs to change their behavior.” And so that’s really the chain reaction. And as I mentioned, we really start to see companies respond. You know, given that we only target three dozen in the last two years, nine of those companies have responded to this chain reaction and have either left Sudan or have significantly changed their behavior, begun to use their leverage for good in the country.
JERRY FOWLER: What has been the effect on the Sudanese government? I mean, if nine companies have started responding in a way that you want, has that had then the ultimate goal of somehow influencing the Sudanese government? Because it seems like they’re as recalcitrant as ever.
ADAM STERLING: Sure. Well, there’s a few ways to judge that and, you know, it’s difficult because the genocide is still going on. And I think it’s important to understand that divestment is one tool of many that we need to use to fight the genocide. But there are a few markers that we’ve seen to show that the divestment campaign is working. The first is that the Sudanese government just doesn’t like it and they’ve responded to it in a lot of different ways. In March of last year they took out a million dollar ad, six pages in the New York Times, basically promoting Sudan and investing in the oil region, and saying that the country had entered a new era of peace and prosperity, you know, a lot of heavy propaganda that they’ve used to confront the divestment campaign. There was a report in the Brookings Institute that came out recently talking about the impact of the departure of one of the companies. Rolls Royce which sells a very specialized oil field product and that is very hard to get anywhere else in the world. So Khartoum actually responded to Rolls Royce leaving and was concerned that, you know, they weren’t able to get this product anywhere else. And Rolls Royce’s departure was directly connected to the Darfur genocide and the divestment campaign. So the message to Khartoum was, “You’re no longer getting this important product for your oil industry, and it’s because of what you’re doing in Darfur.” So I think the response of the Sudanese government, and the change in company behavior. We’re seeing a lot of companies adopt more sustainable practices. And, you know, to this point it’s really been companies on the periphery, the oil field service companies. We really haven’t had the breakthrough with the kind of, as I mentioned, big three oil companies. And if we see those companies respond, then I think we’re really going to start to see a change, and hopefully a solution and end to the genocide, but we need more willpower. We need to build that investor coalition even further so we have the leverage we need against those companies.
JERRY FOWLER: Well, let me push on that for a second, because PetroChina’s obviously probably the biggest. It is the biggest that you mentioned, and then oil companies from Malaysia and India. All three, I think, probably get substantial support from their governments, and all three of those governments are governments who are not very keen to get involved in the internal affairs of other countries. Is it really feasible for investors abroad to bring enough pressure on those government-supported companies that they can change their behavior?
ADAM STERLING: I think it is. It’s not easy. It’s definitely a difficult task. But let’s take a look at PetroChina and China who is, I think, the best example, as you mentioned. And the two arguments are 1) You can’t influence PetroChina because it’s controlled by the Chinese government, and 2) China is just too difficult to move in Sudan. On both those points, if you dig a little deeper, you can see that there is leverage. On the first point, as far as influencing as an investor in PetroChina, more and more PetroChina has approached and has tried to access western capital. In 2000 they had a major public offering on the New York Stock Exchange. So, again, more and more they’re becoming exposed to these types of pressures. And then if we look at the Chinese government, I think, you know, even though they still are kind of the elephant in the room in Sudan, they have moved from when we first started in 2005. They’ve appointed a special envoy. They did vote for Security Council Resolution 1769, which authorized a peace keeping force in Darfur. So although China’s not where we’d like them to be, they have moved. And I think a lot of that goes back to the two campaigns that have included China’s role in Sudan, the divestment campaign and now this campaign linking China to the Olympics and to Darfur.
JERRY FOWLER: We’re sitting here talking now in late December, and then by the time this interview gets posted it’s going to be early January. And just recently, just before it went on holiday break, the Congress passed an Act called the Sudan Accountability and Divestment Act, or SADA, I guess some people call it. We’re waiting to see whether the President is going to sign it. By the time this is posted we’ll know one way or the other. But let me ask you first, what does SADA do? I mean, it sounds like this divestment’s been going on. Why was it necessary to get Congress to pass a law?
ADAM STERLING: Well, SADA does three things. First it actually authorizes and encourages states to divest, and local entities, universities, cities, which was actually really important. One of the barriers, and we have being doing it anyway, but one of the barriers to divestment is there were questions as to whether states could actually do this. Were they interfering in foreign policy? Were they just making investment decisions? So this basically puts all those questions to rest. So states will have no constitutional concerns moving forward with divestment. The second thing that SADA does is it actually provides legal protections for pension funds, and mutual fund companies, and asset managers that divest. So they don’t have to be concerned about, you know, getting sued if this creates a loss. And then the third thing, which is really significant, is that SADA will prohibit these problematic companies in Sudan from actually receiving federal contracts, which is a big deal. So basically the message we’re sending is either you do the things you’re doing in Sudan, or you get our federal contracts, which is a big stick. So we’re really excited about that. And we really feel that this is the most robust piece of Darfur legislation to come out of Congress since the genocide began.
JERRY FOWLER: And as I mentioned it’s still up in the air. We’ll know by the time this is posted whether the President is going to sign it, but it was the case that the administration opposed this legislation while it was being considered by Congress. Why would the administration be against it?
ADAM STERLING: You know, there’s some concern, and I think, you know, from my experience in working with the State Department, who’s kind of been the administration’s lead on Sudan, they really don’t want anyone else involved in their business. And they feel that, you know, “we’re running the show, and we need to make the decisions about Sudan and,” you know, “Congress this is out of your arena, states this is out of your arena.” And I think one of the reasons we’ve seen this divestment campaign proliferate is because the administration has failed to live up to their rhetoric, to live up to the promise of never again. And if we did have an effective response to Sudan we wouldn’t need such a massive grassroots campaign, which is really what the divestment movement has been about, grassroots. So despite this opposition from the administration, SADA passed both the House and the Senate unanimously, and so credit really goes to the hundreds of thousands of activists out there who everyday called their Senators, their members of Congress and really pushed this bill from day one.
JERRY FOWLER: I think it’s important to emphasize this, because it is relatively unusual, especially on the issue of foreign policy, to have Congress pass a bill that’s opposed by the administration and by the State Department, much less pass it unanimously.
ADAM STERLING: Yeah, and again, I think that credit goes to the activists. I mean, you’ve got 22 states that have responded and passed legislation. For example-- and there’s so many stories throughout this process, throughout the development of this legislation. When the bill passed the House it went to the Senate Banking Committee, and there were rumors that the ranking member of the Senate Banking Committee, Senator Richard Shelby of Alabama, was putting on a hold, or was holding up the bill. And so a group of activists from STAND, which is the Student Anti Genocide Coalition that’s been at the forefront of this movement, they got a list of Senator Shelby’s donors and they started calling up his donors, saying-- talking about the bill, talking about Senator Shelby’s resistance and got the donors to actually call up Senator Shelby. And when the bill finally did get to the Senate Banking Committee, Senator Shelby was a sponsor of it and actually helped spearhead the final push of the legislation through the Senate. So, you know, again, just the devotion of the activists and the grassroots throughout the country really, I mean, again, it is a surprise that despite the administration’s opposition this bill passed unanimously in both Houses of Congress.
JERRY FOWLER: So what’s next for this divestment campaign? I mean, you’ve mentioned 22 states have divested. I know a lot of major universities and colleges have divested. What needs to happen now?
ADAM STERLING: I look at the divestment campaign as a marathon. And I think one of the things that’s attracted a lot of activists to the campaign is that it’s really been organic in this. It’s been a consistent source of pressure on the Sudanese government, and it’s something that we’ve been able to build on from the very beginning: adding more states, adding more companies that have responded and changing their behavior in Sudan. So looking at that metaphor of the divestment campaign being like a marathon, I think we’re maybe half way there. And the second half of the race is much more difficult. You have to look into your reserves and push a little harder to finish the race. And, you know, I think we need more support. We’ve gotten 22 states; we need 50 states. And we’re going to be working state legislatures across the country next year. We need help from other countries, investors, you know, around the globe. Individual investors can screen their own mutual funds on our web site, www.sudandivestment.org, and reach out to your mutual fund companies which are some of the biggest investors in these companies. So, as I said, we’ve come across a lot of companies, but we really have to push those big companies, those three companies, the PetroChinas, the Petronases, that have so much leverage over the Sudanese government. And if we can just find the energy and the willpower to finish the race, I think we can change their behavior, change the calculus of the Sudanese government and change the situation in Darfur.
JERRY FOWLER: Well, thinking of the idea that we’re in a marathon and we’re only halfway through can be a little overwhelming for people.
ADAM STERLING: Sure.
JERRY FOWLER: What would be the two, or three or four things that you would encourage individuals and groups to do now in the coming days and weeks?
ADAM STERLING: Absolutely, I think, the first thing, you know, start with your own investments. Close to 60 million U.S. households have mutual funds. And if you go to our web site, www.sudandivestment.org, we’ve got a mutual fund screen tool which allows you to put in the name of your mutual fund, and then you’ll automatically see if it has any exposure to the problematic companies in Sudan. And then we’ve got directions to reach out to your mutual fund manager, explain your concern, have them reach out to the problematic companies, and this has really been a great campaign. We’ve seen thousands of individuals from presidential candidates to soccer moms use this tool to great success, and it’s really had an impact. You can check out on our web site if your state is one of the states that have divested. If it isn’t, then I can almost guarantee we’ll have a campaign and legislation in your state next year in the 2008...
JERRY FOWLER: Let me ask you.
ADAM STERLING: Yeah.
JERRY FOWLER: My home state of Virginia?
ADAM STERLING: Home state of Virginia is one of our biggest targets this year.
JERRY FOWLER: All right.
ADAM STERLING: And it was actually the only state last year where we actually failed to pass legislation. We had legislation. It made it to the last day of the legislative session and didn’t pass. So Virginia is a huge target and it’s still one of the biggest pension funds that’s left that hasn’t divested. So Virginia is at the very top of our list. So if your state has divested you can look at your city, or your university, your college those are all big investors. So, I think, you know, almost every American has the ability to influence and has exposure to these investments that can change the world, or at least change the situation in Sudan.
JERRY FOWLER: Well, we’re coming to the end of the time that we have, and I think a question that’s probably on a lot of people’s minds is, how did you find yourself in this position? I mean, I’m willing to think that-- willing to bet that maybe even five years ago you wouldn’t have imagined that when you graduated from college you’d be the subject of a film and spending all your time trying to stop genocide in Sudan.
ADAM STERLING: You know, absolutely. Five years go I wouldn’t have been able to find Darfur on a map, or tell you that Darfur was a person, or a place, or a region. So, you know, it was about three and a half years ago I was exposed through a class at my school, at my university to the situation in Darfur. And we didn’t wake up overnight and say we were going to start a global divestment campaign, or be feature in a documentary film. We basically said we’re going to start a group and raise awareness. And I remember for the first couple of months we couldn’t get more than four people to our meetings, and it was the four people that started the group. And, you know, as we started to get more people to our meetings we started to think, “what can we do next?” Let’s put on an event. And as we started getting a lot of people to our events, you know, “what next?” Let’s write to our Senators. And after we started sending thousands of letters to our Senators, “what’s next?” And ultimately we came to this divestment campaign. So it was just kind of, you know, looking at what the resources we had available and how we could use those to effect change. And there’s an anecdote in the movie where I say, “I always expected that if I just pushed a little bit further, that at some point the experts would come in,” and whether it was the divestment experts, or the Sudan experts, they would say, “Good job, you’ve got this legislation introduced, you know, shake my hand, we’ll take it from here.” And I quickly learned that those experts don’t exist, or if they do exist, they’re too busy doing their own thing. And we had to become our own experts. And, you know, myself and the countless others that have been part of my team are, you know, some of the most amazing people in the world. And that’s what’s inspired me. I mean, the difficult part is looking at the situation in Sudan and how terrible it is, but the inspirational part is that there’s just thousands of the most amazing people in the world that have dedicated their lives to this. And that’s where I draw inspiration. I mean, there’s good and there’s evil, but you need a little bit of both. I mean, you need the evil because you have to have something to fight, but you need the good to motivate you. And, you know, the film Darfur Now does an excellent job. While it does show the atrocities in Darfur, its focus is on six people who have, you know, dedicated their lives, or parts of their lives, to ending the genocide. And I think that’s what’s inspirational. I hope that is what will drive more people to stand up and take action.
JERRY FOWLER: Adam Sterling is the Director of the Sudan Divestment Task Force, which is a project of the Genocide Intervention Network. Adam, thanks for taking the time to be with us.
ADAM STERLING: It was great to be here. Thank you, Jerry.
NARRATOR: You have been listening to Voices on Genocide Prevention, from United States Holocaust Memorial Museum. To learn more about preventing genocide, join us online at www.ushmm.org/conscience. There you’ll also find the Voices on Genocide Prevention weblog.
