November 25, 2015

Companies Profiting from Mass Incarceration Mapped for Investors
    by Robert Kropp

The American Friends Service Committee publishes research on for-profit prison companies and recommends that investors divest their holdings in five.

SocialFunds.com -- In a recent three-part series on the social and economic implications of mass incarceration in the United States, Sonia Kowal of Zevin Asset Management informed readers that the American Friends Service Committee (AFSC) would soon publish an investment screening tool, which will strengthen the ability of shareowners to pressure corporations to act sustainably, and ease the process of divestment from those companies whose responses are inadequate.

The AFSC research has been published; according to the organization, its “research has spanned the entire scope of the criminal punishment system.”

"We wanted to expand the focus and go beyond 'the usual suspects,' the facility management companies," said Dr. Dalit Baum, AFSC's Director of Economic Activism.

According to the American Civil Liberties Union (ACLU), the United States, with five percent of the world's population, incarcerates 25% of the world's prison inmates. A study published in June found that “inmates in private prisons are likely to serve as many as two to three more months behind bars than those assigned to public prisons and are equally likely to commit more crimes after release, despite industry claims to lower recidivism rates through high-quality and innovative rehabilitation programs.”

“The privatized prison industry has been shown to contribute to human misery in its operations, and to mass incarceration in its political influence,” AFSC stated. And, while its primary focus is on the large, publicly traded corporations, “we hope to contribute to the larger movement to end mass incarceration by providing the information below on the entire field of profiteers,” it states.

To investors, AFSC says, “If you are invested in any of the companies on our screens, you should definitely do something about it. As an investor, you have the responsibility as well as the power to take action...We do recommend divestment from a limited number of companies.” Of the five for-profit corrections companies recommended by AFSC for divestment, four—Corrections Corporation of America (CCA); Geo Group; G4S; and Sodexo—are involved primarily in facilities management. The fifth, Providence Services, focuses on private probation; “Over 1.6 million adults were on probation for misdemeanor crimes as of January 2013,” the organization revealed.

Founded in 1983, CCA is the largest facilities manager in the private corrections industry. “Since the company’s founding, the incarcerated population has risen by more than 500 percent to more than 2.2 million people,” AFSC's research reveals. “Meanwhile, the number of people held in immigration detention centers has exploded from an average daily population of 131 people to over 32,000 people on any given day.”

"The profit motive is a key driver of mass incarceration in the US, and these corporations wield tremendous economic and political influence," Caroline Isaacs of AFSC said.

Earlier this month, AFSC launched its tool for investors at the annual SRI Conference hosted by First Affirmative Financial Network, where it received an enthusiastic response. "I'm delighted to finally have a good and credible source of information on companies profiting from mass incarceration and I'm looking forward to using the tool to instigate impactful change," Kowal of Zevin stated.

“There is something deeply wrong with profiting from human misery," Isaacs of AFSC said. "This tool will help us do something about it."