Establish Investment Policy

Once consensus has been reached about what it means for an institution to align its endowments with its mission,  the next step is to formalize this understanding into a statement that will serve as a living guideline for those responsible for managing the endowment assets. The statement should set clear goals and objectives related to sustainable investing which are linked to the mission of your institution.  

 

Guidance from IEN and others

The Paris Agreement in the Investment Policy: Sample Language for Integrating the Goals of the Paris Climate Agreement into an IPS  Intentional Endowments Network, June 2017

Considerations for ESG Policy Development Intentional Endowments Network, June 2017

Applying Mission Focus to Your Investment Policy Statement Through ESG Investing Trillium Asset Management, June 2017

Sample ESG Investment Policy Statement FEG, January 2018

Sample Investment Policy Statement Rider for Responsible Investing Commonfund, February 2016 

 

Specific IPS language for incorporating ESG into the investment process:

ESG Language Excerpts from Endowment Investment Policy Statements Intentional Endowments Network, March 2018

 

Sample Sustainable Investing Policies

Some endowments embed their sustainable or ESG investing policy throughout their IPS while others create a separate statement. Here are some samples of each: 

 

Embedded in full Investment Policy Statement

Haverford College | 2016 t includes Sustainability language, Section VI A.

Humboldt State University| 2015, Entire IPS Section VII: Socially Responsible Investing

Lewis & Clark College| 2014 Section 2.D (p. 2): Paragraph indicating that ESG integration supports long term investment objectives and states "Lewis & Clark encourages its managers to include ESG factors in their analytical processes."

Loyola University of Chicago l 2016 Section 1.D outlines responsible and sustainable investing principles to embody Jesuit and Catholic traditions, abide by fiduciary standards applicable to institutional funds, and integrate ESG factors.

Oregon State University| 2012, Should excerpt pages 8-20 for simplicity.  ESG language is around evaluating managers. The investment policy is on pages 8 - 20. Article 10: ESG Review

San Francisco State University2017 Section IV and Exhibit 1: Social Responsibility Policy and Prohibited Investments

San Jose State University| 2016 Page 8 has a section devoted to Social Responsibility

University of Puget Sound | 2016 Section XIV on page 11 allows for the capacity to invest in an SRI vehicle whose values align with the mission of the University and Section XV allows for the development of a fossil fuel free pool.

University of Washington, Seattle| 2016 Section D  Ethical Considerations, prohibits direct investment in coal companies whose principal business is the mining of coal for energy and applies negative screens to certain companies doing business in Sudan and to tobacco companies. It additionally establishes a focus on corporate responsibility as a consideration for investment in companies. 

Western University| 2017 Recognition of importance of ESG factors in Investment Beliefs section and Section 4: Responsible Investing Policy

 

Separate Sustainable Investing Policy

Earlham College | Sections 3. A and B. and 5 A and B. demonstrate SRI and ESG considerations
Georgetown Universityl 2017 Policy to memorialize the University’s existing commitment to meeting its fiduciary responsibilities in a manner consistent with its Catholic mission and Jesuit identity

Hampshire College | 3 page addendum to IPS on ESG investing policies, 2011

Pratt Institutel 2016, 2 page statement on Fossil Fuel Investment Policy

University of California| 20 page document outlining UC's sustainable investing framework; elaborates actions which include: joining initiatives such as PRI, Investing $1B over 5 years in climate change solutions (venture capital), harnessing the knowledge and expertise of the full UC community, opening ESG dialogue and eventually criteria with external managers, developing shareholder engagement policies and reviewing proxy voting policies, and reporting on progress.

Warren Wilson College | 2017 - need to download file for use in Roadmap| 4 page Responsible Investment Policy

Yale University | 2018, Ethical Investing Policy addresses governance, climate change, assault weapons, private prisons, Puerto Rican debt, and implementation.

 

Investment Policy Statements from Foundations

Many private and family foundations have been leading the way in mission-aligned investment.  Their IPS's may have language that higher education endowments will find helpful.

Heron Foundationl 2016, IPS begins on page 5 and includes eight guiding principles central to Sustainable, Responsible and Impact Investing

McKnight Foundationl 2016, Includes ESG Factors in most sections of the policy, includes a section on proxy voting

Rockefeller Brothers Fund 2016 Addresses Fossil Fuel Divestment in its benchmarking and includes a section on mission-aligned investment strategy.

Meyer Memorial Trustl 2016 provides investment principles that guide the investment program.

 

 

 

 


 

 

 


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