In their recent Foreign Policy In Focus piece, “Divestment: Solution or Diversion?” activists Kevin Funk and Steve Fake criticize Sudan divestment as an ineffective diversion from the real bugaboo: Israel. If the “worst offending” companies bankrolling the Sudanese government’s genocide in Darfur are not based in the United States, Funk and Fake reason, the process of influencing companies and the Sudanese regime will inevitably be “convoluted.”
Better for activists to “focus their efforts where they can most effectively influence change, generally the policies of their own governments.” For Funk and Fake, that means divestment from Israel for its “war crimes.” Putting aside the authors’ puzzlingly one-sided conception of the Israeli-Palestinian conflict, their article betrays a fundamental misunderstanding of both the motives and the mechanics of the Sudan divestment movement.
Divestment ought to be activists’ last resort, even in cases of human rights abuses. The vast majority of foreign direct investment helps developing countries by improving living standards and often promotes democratization. Even in cases of corporate malfeasance, shareholder engagement is almost always more effective than divestment in changing problematic behavior. Sudan divestment is therefore unique in the extremity of the situation (an officially declared genocide with more than 200,000 dead), foreign direct investment enabling the atrocities, the failure of traditional shareholder engagement, and perhaps most importantly, divestment’s effectiveness. “Convoluted” as the process may be (“sophisticated” seems more apt), the strategy of expedited engagement followed, when necessary, by divestment, is already changing corporate behavior and the situation’s diplomatic dynamic. Though in some cases, divestment has forced firms to leave Sudan entirely, this is not, as Funk and Fake presume, the campaign’s primary goal. The issue is not whether companies do business in Sudan, but whether or not that business contributes to genocide in Darfur.
Unfortunately for Darfuris, they live in a place and time in which U.S. influence is on the wane. As Funk and Fake point out, the United States has not contributed as much to the African Union (AU)-UN peacekeeping force as it could (although more funding currently appears to be in the works). But it has given more than anyone else, footing 25% of the peacekeeping bill and donating more than $4 billion in humanitarian aid. Far from detracting from these efforts, state-level divestment has prodded the federal government to take stronger action and prompted both multinational corporations and foreign governments to change their behavior, not to mention rattling Khartoum.
Implying that Sudan divestment has been successful only because it accords with “establishment prerogatives” (which would automatically discredit the movement), Funk and Fake ignore Bush administration opposition to the Sudan Accountability and Divestment Act currently in the Senate. The administration’s opposition comes in addition to investors’ longstanding reluctance to even consider social factors in their decision-making process. The UN has called Darfur the “world’s worst humanitarian crisis.” Funk and Fake would rather change the subject.