Partnerships at Work: Manhattan Country School

By Michele Sola
From the Summer 2012 Edition of Values


Manhattan Country School was founded in 1966 as a private school based on the principles of equality, social justice, and diversity in education, striving to make real the vision of Dr. Martin Luther King and the passion of the civil rights movement. Since 1966 we have worked to incorporate our core values in the curriculum, community practices, and governance of our school. This year we celebrate our 45th anniversary—and 25 years of partnership with Walden Asset Management. With Walden we were among the earliest adopters of socially-screened investing.

Concerned about the inequities of traditional “tuition scholarship” practices, the trustees, parents, and staff set out in the early 1970s to create a sliding-scale tuition system as the basis for economic diversity. A decade later the board began to raise funds for an endowment to help support what we called Tuition Reform. Examining our investments to ensure that they reflected our larger purpose was a natural extension of our mission. In 1982 the board voted to divest the stock of companies that did business in South Africa under apartheid. We believed that such companies were supporting institutionalized racism, even if unwittingly. When we discovered that our bank made loans to South Africa, we moved our business to another bank in protest.

Believing it was our obligation to spread the word, in 1985 we convened a conference for trustees of private schools in the New York City area, urging them to join the South Africa divestment campaign. New York Times coverage of this unusual gathering quoted Manhattan Country School founder Gus Trowbridge: “Many private schools are very private. They’ve been protected from a public accounting. But the issues have become too overwhelming.”

Choosing an investment manager to help us develop as a responsible investor was a logical progression, and so began our relationship with Walden (formerly United States Trust Company of Boston). This partnership resulted in a broader philosophy and more far-reaching social investment guidelines, moving well beyond South Africa. The belief that our school’s values needed to be integrated into our investment objectives and economic decisions became a reality for Manhattan Country School that has been embraced by our community.

Initially our investment approach focused on “screening out” companies whose policies conflicted with the school’s values. Over time we came to see our potential to strengthen corporate responsibility and accountability through shareholder engagement and proxy voting. We also took the very public step of co-filing shareholder resolutions with other investors, calling on companies to 

  • strengthen nondiscriminatory employment policies, including on the basis of sexual orientation;
  • increase board diversity;
  • review environmental policies related to oil sands development;
  • reduce greenhouse gas emissions and support climate risk mitigation;
  • adopt fair trade practices and robust health and safety standards in factories throughout global supply chains;
  • increase accountability and transparency on executive compensation; and
  • expand environmental and sustainability reporting.

Our shareholder resolutions, along with those of other investors, prompted many companies to strengthen policies, practices, and transparency on important social and environmental matters. Convinced of the “power of the proxy,” in 2005 Manhattan Country School sent letters to other schools, urging them to vote their shares as a means to support greater workforce diversity, environmental protection, and better working conditions overseas.

Today our work as a sustainable and responsible investor is a natural and internalized part of our identity as a school. We know that too few private schools, colleges, and universities take the time to ensure that their investments are aligned with their missions and values. We are also mindful that our commitment to an economically diverse student body depends heavily on maximizing our investment returns, a goal that does not conflict with our dedication to socially responsible investing. Our 25-year partnership with Walden has taught us something that we are glad to pass on to other schools and colleges; namely, that mission-consistent investing is both important and integral to a school’s fiduciary duty as a long-term investor.