As a responsible investor Harvard should sometimes, according to the Austin committee report, "attempt to influence management in directions that are considered to be socially desirable."

Since 1972, the ACSR has had the responsibility of seeing that Harvard invests its money and votes its proxies. Stevens says "The very fact that this is a public community process is already a position by the Corporation on behalf of its responsibility as a shareholder." But whether the process is a strong enough statement of Harvard's social responsibility is a matter of controversy, especially when it comes to the question of investments in corporations doing business in South Africa.

In a report issued March 24, 1978, the ACSR outlined several basic propositions that had emerged from its discussions throughout the preceding winter. Acknowledging that both the University and corporations have "responsibilities of citizenship" that may supercede economic considerations, the ACSR stated, "When the policies of actions of a company in the Harvard portfolio are not consonant with good citizenship, the University has an obligation to advocate that such policies and actions be changed."

The ACSR also decided that in the case of South Africa, the corporations themselves would have to prove their good citizenship. The ACSR listed a series of guidelines that companies choosing to remain in South Africa should follow in order to "ameliorate the effects of apartheid with respect to their own employees, even where such action impinges on profitability." The guidelines are based on principles first proposed in 1977 by Rev. Leon Sullivan, a director of General Motors Corporation, and would require a company to end discriminatory practices in employment and working conditions.

In addition to improving employment practices and policies, companies operating in South Africa should provide descriptions of product lines and services offered in South Africa, reports on sales to the South African government and its public corporations, reports on the extent to which labor practices meet the ACSR's criteria, and an annual income statement and balance sheet for operations in South Africa, the ACSR stated.

Because corporations are under no legal obligation to disclose all the information the ACSR requests, and because the South African government prohibits the release of some of this information, the committee considered a few options for dealing with intransigent companies. The ACSR rejected the option of divestiture of stock in such firms except in extreme cases because, according to the March 1978 report, "Our investigations persuade us that the act of divestiture by Harvard alone is unlikely to result in financial consequences to the divested company of sufficient magnitude to force a change in policy."

In its statement of April 27, 1978, based on the ACSR report, the Corporation concluded that divestiture "is only appropriate under extremely limited circumstances" because "it is a relatively ineffective means of pursuing ethical ends." The statement called divestiture a "last resort" to be employed only when a company fails to adhere to reasonable ethical standards, long-term efforts to change company policy have failed, and future efforts seem doomed to failure.

With divestiture essentially ruled out as a way to change corporate policy, the ACSR turned to the question of how to vote shares in Harvard's portfolio, specifically on resolutions calling for the withdrawal of corporations from South Africa. Unable to reach a consensus, the committee recommended evaluating the question of withdrawal on a company-by-company basis.

The Corporation agreed with the ACSR's position and established specific conditions under which it would support a resolution calling for withdrawal, including the following:

* A company fails to disclose all the information required by the ACSR's guidelines.

* A company refuses to demonstrate within a reasonable period of time its determination to implement the employment practices and policies set forth in the ACSR report.

* The nature of the company's operations in South Africa is such that its continued presence inevitabley does more to strengthen the existing regime than progressive employment and social policies can contribute to the welfare of non-white employees and the eventual destruction of apartheid.

Stevens believes the ACSR faces two major problems in deciding on questions of withdrawal. First, the committee must acquire "a decent base of information on which to judge," he says. "The second problem is you have to have some feel for what is net negative and net positive in South Africa," he adds. To obtain information, the ACSR and Corporation often write directly to companies, and sometimes Corporation members who know company directors can use their personal relationships to extract information.

Much of the information which the ACSR and Corporation use comes from the Investor Responsibility Research Center, a non-profit organization based in Washington that was created by universities and foundations in 1972 to investigate corporate practices and supply its sponsors with relevant information.

If attempts to obtain information fail, the ACSR recommended, in its report of January 1979, that the Corporation initiate what it termed "information resolutions," noting that requests for information by universities are especially appropriate because "their primary purposes revolve around education, learning, and the dissemination of knowledge." It distinguished "information" from "action" resolutions, and said the latter should be used even more sparsely.

Harvard has never sponsored a shareholder resolution.

Says Stevens: "The charge has been made so often that the University has no policy. It has a very clear policy. It has one of the few clear policies that exist at any university-type investor in this country."

But Stevens acknowledges that the policies are still a matter of debate. "The question is not whether we have a policy or not, but whether the policy we have goes far enough," he says. Many people, including the hundreds of members of campus organizations and the thousands of students and faculty who have signed petitions demanding the University divest, believe Harvard's policies do not go far enough.

And, that disagreement will lead Harvard from a relatively mild winter into a stormy proxy season.