Commissioner Dan Saltzman is tired of talking about which corporations the City of Portland should or shouldn't invest in.
"There are a lot of issues I’m not getting work done on today," Saltzman said this afternoon, near the end of a lengthy hearing on a controversial new city investment policy. "I don't really want to have to do this once or twice a year and have the same discussion over 21 companies."
If not all of Saltzman's colleagues shared specifically that sentiment, two of them agreed with what he was driving at. In a 3-2 vote that is among the more divided of this group of elected officials, the council voted to make it the city's official policy not to invest in corporations going forward.
In doing so, the council sideswiped a proposed strategy that would have moved the city's investment decisions behind closed doors—a prospect that made many commissioners and an overwhelming number of vocal audience members uncomfortable.
Rather than wallow in acrimony, council decided to be done with corporate investments altogether. The vote means a number of things:
•That the City of Portland's in no danger of putting money into companies like Nestlé, Wells Fargo, Walmart, Caterpillar, and sundry others that a group of citizen advisers have dubbed the "worst of the worst" in terms of corporate actors.
Not long ago, the city created a "do-not-buy" list where it slapped companies it wanted nothing to do with (Walmart, Chevron, and Exxon all had homes there). But when a council-appointed Socially Responsible Investments Committee (SRIC) pressed council late last year to put nine more companies on the list, commissioners balked, worrying about the message that would have sent.
Instead, the council made a temporary decision not to invest in corporations, which it formally enshrined today—partly because Saltzman was sick of talking about it.
•It also means that Portland won't be taking a proactive stand against companies that do some objectionable things. Advocates for explicitly calling out certain corporations argue that those companies take a PR hit when a large city calls them out as toxic that's greater than any risk to their bottom line (see: Seattle pulling the plug on Wells Fargo).
As SRIC member Hyung Nam told the Mercury recently: "It's not about the financial impact. It's about the public image that these corporations care about so much."
Simply not investing in any corporate bonds—which was the city's standard operating procedure less than a decade ago—doesn't send that same message.
•Portland is also going to lose out on some cash, though exactly how much isn't clear. City Treasurer Jennifer Cooperman said at the hearing that not investing in corporate securities could mean $3.5 million less in city coffers this fiscal year, and perhaps a larger hit next year.
But that number is based on corporate bond returns versus lower performing US Treasury Bonds, Cooperman acknowledged to the Mercury after the hearing. That's a standard way of analyzing investment choices, Cooperman says, but the treasurer also acknowledged in a February memo that it is a "worst case." She wrote that other investments, like US Agency Bonds, are more lucrative, meaning the loss she spoke of at today's hearing isn't set in stone.
Still, the city can probably expect to take some financial hit, which was a big reason why Mayor Ted Wheeler forcefully opposed eliminating corporate investments.
"I really don't like the idea of completely getting out of corporate," said Wheeler, the former state treasurer, who rattled off a list of things that the lost money could pay for. "I just think they hit us too hard."
Rather than divestment, which Wheeler called a "blunt instrument," he used a lengthy speech to advocate that people (and the city) make more ethical purchasing choices, and suggested that there are people who will advocate divesting from any company.
"Do you use a Visa or Mastercard? Because if you do according to some you’re feeding the beast," Wheeler said.
The mayor pretty clearly wanted to move ahead with the proposal he'd brought forward. It would have scrapped all public discussion about which companies the city should invest in, and instead used a secretive ratings system that evaluates companies on their environmental, social, and governmental practices. The city would have been legally prohibited from sharing those ratings or its rationales with citizens.
Not a single person in the audience testified in favor. They called on the city to be a leader in social justice, suggesting companies' complicity in projects like the Dakota Access Pipe Line or funding private prisons needed to be highlighted.
The most forceful testimony came from Katrina Scotto di Carlo, a founder of Supportland and member of the SRIC. She was angry that council had refused to accept a report her committee submitted last September.
"I went through emotional battering on that committee," Scotto di Carlo said, speaking of the research she did into companies' bad practices. "I had to read about crap that I hope no one else in this room has to read about."
She used the indentured servitude of fishermen in Southeast Asia as an example, and said her group had truly picked the worst nine companies it could find.
"We only put nine on the list—that’s incredible," she said. "Unbelievable that you guys didn’t adopt the report."
Council split assunder pretty quickly when it came time to decide.
Commissioner Chloe Eudaly most clearly agreed with the activists on hand. She'd even tried to introduce amendments that would have explicitly put Nestle, Caterpillar, and the Bank of New York Mellon onto the do-not-buy list, and left leeway to add more.
When Wheeler recently called for Portland to be a sanctuary city, Eudaly told him, "you said that Portland would be a beacon of hope and set the standard for the country. I would argue that we have another opportunity here to set another standard."
Supporting the secretive investments system were Wheeler and Commissioner Amanda Fritz, who also was concerned about lost cash.
Saltzman and Commissioner Nick Fish came down on the side of doing away with corporate investments entirely (though Fish made clear he was cool going the secret route)—a compromise Eudaly found she could live with.
So there you have it! We're done with corporate investments—at least until next year, when the city is bound by state law to pass an investment policy again.