The issue: Prison industrial complex
Mass incarceration is a manifestation of racist policy
Investor-owned companies are profiting from exploitative prison labor, immigration jails, and other economic systems of oppression and exploitation.
Retirement plans are invested in private prison operators and other high-risk companies
Mass incarceration is particularly devastating for poor communities, immigrants, people of color, and their families. For-profit firms have flooded money into prison and immigration jail infrastructure and services, and have used industry associations to lobby for harsher policing and longer sentencing, even for non-violent offenders. People who are incarcerated work for pennies per hour while their families pay exorbitant fees to keep them supplied with bare necessities. Powerful, private equity interests and corporations reap enormous profits from the militarization of the U.S.-Mexico border and the policing of immigration.
Asset managers like Vanguard are investing in economic systems of oppression and exploitation – and they’re using workers’ retirement plan savings to do so. Through Vanguard, the retirement plans of companies like Amazon and Comcast are investing hundreds of millions of dollars into private prison operators and other companies recommended for divestment by the American Friends Service Committee state violence criteria.
FOCUS: SUSTAINABILITY RISK
Private prison operators
Cities, counties, states, and the federal government sometimes contract with for-profit private contractors to operate prisons, jails, and immigration jails. Corporate retirement plans have hundreds of millions of dollars invested in private prison operators like U.S.-based GEO Group and CoreCivic, British company Serco, and French company Sodexo.
These private prison corporations spend substantial money on lobbying and campaign contributions to secure contracts and promote legislation that results in higher rates of incarceration. For many of these contracts, the companies are paid based upon how many beds are occupied in any given facility, incentivizing the company to support incarcerating more people.
Exclude high-risk prison industrial complex companies from retirement plan default options
The default option offered in company retirement plans, which usually ends up with the bulk of employee contributions, should be sustainably invested and exclude companies with significant involvement in the prison industrial complex like private prison operators.