The university’s endowment fund, meant to support educational and research goals, was misused to acquire 850,000 hectares of farmland across 5 continents during the past 10 years
An investigative report shows how Harvard University’s endowment fund used an opaque corporate structure to acquire control of an estimated 850,000 hectares (ha) of farmland across five continents during the past 10 years.
The investigation done by Barcelona-based GRAIN and the Brazilian Network for Social Justice and Human Rights based in Sap Paulo (Rede Social) demands an immediate stopping of all its investment in farmland and resolve all land conflicts and ensure the affected communities are adequately compensated for damages. The report titled, Harvard’s billion-dollar farmland fiasco was released on September 6.
The endowment fund was meant to support educational and research goals of the university but it has been misused for farmland deals in South America, Africa, Rusia, USA and Australia.
An endowment is a fund that holds its principal in perpetuity and only pays out a small portion, about four to five percent per year, for campus operations and programs. It has dual goals i.e. to grow the principal and to generate income.
A small international non-profit, GRAIN supports small farmers and social movements in their struggles for community-controlled and biodiversity-based food systems.
Rede Social de Justiça e Direitos Humanos, also a non-profit, provides legal defense, research, education and advocacy support to guarantee the economic, social, cultural, civil and political rights of social movements in Brazil.
What does the report say?
The report shows a number of case studies from Brazil which clearly show human rights violation of indigenous communities by denying the right to access of water and land. It documents in detail about the continuous conflict over land and water with the local community.
Harvard’s farmland deals in Brazil are concentrated in the northeast region of the country (see map), where lands traditionally used by local communities are being grabbed at an alarming rate by agribusiness companies for the large-scale production of commodity crops like soybeans and sugarcane.
The university began buying farmlands in the immediate aftermath of the financial and food price crises of 2007 and 2008. During this time, there were collapse of the housing market in USA and Europe, where they had been invested its endowment funds.
The university began by buying farmland in Brazil, South Africa, and New Zealand in 2008. Major investments were also made in Russia and Ukraine, followed by several farm purchases in Australia and the United States. By June 2017, Harvard had injected over US$ 930 million into its various farmland subsidiaries and had acquired control of over 850,000 hectares of farmland around the world, making the university one of the world’s top farmland buyers
The reports showed it through map how endowment funds have been used to grab land. The largest chunk of lands in East Europe mostly includes Russia and Ukraine. In East Europe, it purchased 487,000 hectares of land valued at $152.5 million followed by South America 293,631 ha estimated at $450 million.
The report details how Harvard’s farmland deals are connected to multiple conflicts over land and water, including instances of land grabbing in Brazil. “We estimate that Harvard’s endowment fund spent over US$1 billion during the past decade to acquire farms around the world, which is more than has been spent by any other endowment or pension fund,” says Devlin Kuyek, a researcher with GRAIN in its press release. “They made risky investments with seemingly little due diligence in some of the most conflict-ridden rural areas of the planet, such as South Africa and northeastern Brazil.”
The investment has been channeled through opaque network of subsidiaries, registered in different tax heavens such as US state of Delaware or the Cayman Islands or Mauritius.
One of the overseers of this fund, Kat Taylor has resigned from this Endowment fund accusing the university of indulging in unethical activities, including forcible land purchase in violation of indigenous rights over their access of natural resources like water.
“We identified farms covering nearly 300,000 ha of land that Harvard acquired in Brazil’s Cerrado, the world’s most bio-diverse savannah,” says Daniela Stefano, a researcher with Rede Social. “Our investigations into these deals show that Harvard is contributing to land grabbing, environmental damage and the destruction of water sources for local communities.”
“We found several cases where Harvard purchased land from Brazilian business groups with titles to the properties that were not valid,” says Stefano. “In some instances, the local communities had been intimidated into vacating the lands. In others, there were long standing legal disputes over the lands that Harvard should have been aware of.”
In the meantime, the idea of investing in farmland has not proved profitable. The Boston-based fund managers that orchestrated university’s controversial move have recently exited from the endowment. The top fund manager made a whopping $242 million in revenue whereas endowment funds performed badly.
Last year, the endowment’s new chief, N.P. “Narv” Narvekar, re-evaluated the fund’s investments in timber and farmland which led to the entire natural resources portfolio being written down from $4 billion to $2.9 billion. The Harvard Endowment fund management was aware of these violations, the report says.
“Harvard cannot plead ignorance,” states the report. “It pursued these investment in farmland despite years of public criticism and demands for greater due diligence”
Source: Down To Earth