In an Indonesian shoe factory, workers labor 10 to 12 hours a day, seven days a week, crowded in hot rooms, ingesting poisonous chemicals.

Across the globe, a Canadian oil company makes plans to drill on a South American Indian tribe's ancient burial ground, changing its plans only when thousands of U'wa Indians threaten to throw themselves off a cliff in a mass suicide.

At home in the U.S., a healthcare company defrauds the federal government and lies to industry regulators.

These are allegations against Nike, Occidental Petroleum and Columbia/HCA, respectively, as published by The New York Times and the Los Angeles Times.

And as of last June, Harvard owned 91,000 shares of Nike, 320,000 shares of Occidental Petroleum and 500,000 shares of Columbia/HCA.

But Harvard administrators say they are concerned about the ethics of investment. In fact, in 1972 the University created two committees on shareholder responsibility to review Harvard's holdings.

But instead of aggressively scrutinizing whether to buy or sell certain stocks, these committees confine themselves to narrow and formal questions of company policy, called proxies--questions whose answers rarely change anything.

Meanwhile, fund managers at the Harvard Management Company (HMC), which manages Harvard's $11.2 billion endowment, continue to pursue the highest yield, officially relieved of the burden of making ethical choices.

Division of Labor

Each year the Multinational Monitor, a Washington-based organization, names 10 companies that it alleges maintain the worst working conditions, create environmental hazards or engage corruption.

And according to a report filed by Harvard with the Securities and Exchange Commission, the University owned stock in seven of the top 10 companies during the 1997 fiscal year.

In addition to Nike, Columbia/HCA and Occidental Petroleum, Harvard invests in Elf Aquitaine, TRW, Tyson Foods and American Electric Power, companies which the Multinational Monitor alleges are involved in improprieties including bribery, international coups or maintaining substandard working conditions.

HMC's freedom to focus solely on profitability has led it to record-breaking success. In two years it has added nearly $4 billion to Harvard's coffers with annual returns of 26 and 25.8 percent.

HMC President Jack Meyer refused to comment on the issue of shareholder responsibility, but Provost Harvey V. Fineberg '67 says HMC should continue to focus solely on questions of financial success, not ethics.

"I wouldn't want a system that combined the two," Fineberg says. "Money managers get the best return."