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Bill would force US higher education endowments to reveal where they invest

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In January, Missouri Rep. Emanuel Cleaver will introduce the Endowment Transparency Act to Congress, a move that could, frankly, change everything.

Cleaver’s bill seeks to amend the Higher Education Act of 1965 to require universities and colleges to share information about how they allocate endowment investment funds to women-owned businesses and women. minorities. These higher education institutions, which collectively manage more than $821 billion in assets, have been notoriously secretive about where they invest money and, despite calls for change, many have refused transparency.

“It was noble to desegregate a student body and a faculty, but it’s nobler to desegregate the economy because those are the reasons things are the way they are.” Representative Emanuel Cleaver

Education giants play a vital role in the venture capital market as sponsors. TechCrunch previously reported on the pressing need for leaders to take more responsibility in the unequal corporate landscape that disproportionately excludes women and people of color. Those calls turned into cries for more diverse fund managers and more money invested in minority-led funds — or at least criteria by which LPs hold venture capital general partners accountable for the type of companies in which they invest.

Heartbreaking statistics on the number of diverse fund managers, coupled with the dearth of capital allocated to minority fund managers and founders, point to the role endowments can play in maintaining existing inequalities. Speaking to TechCrunch, Cleaver said that when he tried to contact higher education institutions to discuss their reluctant behavior regarding asset management diversity and allocation, even he sometimes got closed doors.

“These colleges brag about inclusion because they have minorities in their faculty and an inclusive student body, so they think it’s okay,” he said. “But let me say it was noble to desegregate a student body and a faculty, but it’s nobler to desegregate the economy because those are the reasons things are the way they are.”

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