2017 Presidential Climate Leadership Summit | Second Nature, February 13-15, 2017, Tempe, AZ
IEN members will be delivering a plenary panel on factoring climate and sustainability considerations into the endowment investment process; and IEN will be hosting a half-day workshop on endowment investing.
- Research shows that companies where women are better represented in leadership simply perform better. And the financial power of women continues to grow. Yet, staggering gender inequality persists in varying forms across the globe. In this session, Kathleen McQuiggan and Julianne Zimmerman will explore why we should be investing more in women, the economic, social, and financial investment case for investing in companies led by women, how investors can make an impact when it comes to gender diversity, and the role we can play in closing the gender gap.
- The webinar will provide an overview of the value of proxy voting and additional forms of engagement for endowments that are involved in commingled funds through an outsourced CIO – including the current landscape, trends, specific issues, and why it is important for investors. Guidelines and opportunities of how to take action will also be provided.
- Find out why leading global investors are putting increasing pressure on US managers to adopt stricter environmental, social and governance (ESG) principles as they consider investing in private equity and other alternative asset classes. Building on the success of the longest-running ESG event in Europe, the Responsible Investment Forum comes to New York to bring together the most sophisticated LPs, GPs and service providers to discuss why, when, and how your firm should be implementing an effective ESG strategy.
- The Impact Investing Forum will look at many of the asset classes that encompass this space. We invite you to join us and meet top influencers, experienced investors, money managers, and service providers that are leading the charge in this ever growing space. Themes of defining impact investing, portfolio construction, asset class opportunities, and the role of the investor are just a few of the stimulating topics to be covered at this event. This conference will exclusively feature dialogue driven panel discussions led by consultants and family offices.
- The Impact Capitalism Summit is the Largest Convening of Impact Investors Globally. This year at the Impact Capitalism Summit in Chicago we will explore the progress of leading impact investment portfolios, discover the latest innovations across sectors, themes and asset classes, and identify the steps needed to harness the power of capital markets to build a sustainable, fair and just economy where opportunity and prosperity are shared by all.
- Companies identified as “long-term” outperform their shorter-term peers according to new research from professional services firm McKinsey for FCLT Global, the investor/corporate coalition that promotes long-term investment. Read a summary of the results from Responsible Investor (subscription) here.
- This week's Bloomberg Brief highlights how some investors in Facebook Inc. and Alphabet Inc. (including IEN Founding Member Arjuna Capital) are growing worried about how the tech giants manage "fake news" on their platforms could drag down profits and leave them vulnerable to regulatory risks. Other highlights include Seattle council unanimously voting to withdraw about $3 billion of the city's funds from Wells Fargo & Co. as it seeks to distance itself from the bank's involvement with Dakota Access Pipeline, a new start-up that thinks newly moneyed millennials will be willing to pay extra for a passive investment that gives them more of a voice, and AOL Inc. Chief Executive Officer Tim Armstrong setting a goal to have women represent 50 percent of the organization’s leadership by 2020.
- Access to capital is notoriously difficult for farmers. To make the process easier, Dr. Stephen Rivard and David Miller created Iroquois Valley Farms (An IEN-Member) to invest in land leased to farmers who convert conventional operations to organic. The Iroquois Valley Farmland REIT public benefit corporation, includes 32 farms across nearly 4,500 acres in Michigan, Maine, New York, Kentucky, Montana, West Virginia, Illinois and Indiana; 73 percent of that acreage has transitioned into certified organic land. It has some $30 million in assets, with 41,500 shares valued at $568 per share.
- This article discusses Kevin Parker's Sustainable Insight Capital Management and the various dynamics of the ESG market.
- The London Stock Exchange Group (LSEG) has issued guidance, through its Global Sustainable Investment Centre, which sets out recommendations for "good practice" in Environmental, Social and Governance (ESG) reporting. The global guide brought calls today from a member of the World Bank Group for other stock exchanges around the world to follow the bourse’s example and lead. The guide responds to “demand from investors” for a more consistent approach to such reporting that now forms a core part of the investment decision process and to enable investors to make more informed investment decisions.
- Nearly 200 nations agreed in Paris in 2015 to take steps to limit the increase of the global average temperature to no more than 2°C (from pre-industrial times) by the end of the century. The physics of climate change demands an exceptional and immediate response. The world remains on track for 3.6°C of warming, according to the United Nations, and 2016 marked another year of record breaking high temperatures. Further, the U.S. election results created more uncertainty. Amidst these challenges, investment tools and strategies to fight climate change are increasingly important and already available.
- On December 29, 2016, the U.S. Department of Labor (“DOL”) issued new guidance for ERISA plans regarding proxy voting, statements of investment policy (including proxy voting policies) and other shareholder rights. The new guidance, Interpretive Bulletin (“IB”) 2016‑1, withdraws previous guidance which had been interpreted to restrict ERISA plans in voting proxies and exercising shareholder rights unless a cost‑benefit analysis had been conducted. The new guidance also confirms that material environmental, governance and social factors are permissible considerations when developing statements of investment policy. Trustees of ERISA plans may wish to review their proxy voting policies, statements of investment policy and investment manager contracts to ensure they reflect the new guidance.
- People often talk about barriers to ESG integration. Hiding places might be a better metaphor. If you ask an investment fiduciary to do something new, some (though not all) will seek out a number of things to hide behind as to why they can’t. The most popular hiding places have tended to be: fiduciary duties, investment consultants and lawyers. PRI is interested in eliminating hiding places. Through their work on fiduciary duty, building on the work of countless initiatives on that subject, we’ve reduced the size and effectiveness of that hiding place. This article discusses evidence that investment consultants are increasingly advising clients on ESG risks and analysis, though of course, laggard practices remain common.
- This week Trillium Asset Management and more than 100 sustainable investors and businesses signed a letter urging the Administration and Congress to continue support for the Consumer Financial Protection Bureau (CFPB). Jointly organized by the Interfaith Center on Corporate Responsibility and the American Sustainable Business Council, the letter defends the CFPB, which has provided strong regulatory oversight of the financial sector to protect the interests of consumers, communities, and businesses since 2010. Members of Congress have begun to re-write CFPB regulations, which have the power to limit funding in the future and remove the director.
- Sweden has committed to completely phase out greenhouse gas emissions by 2045 and called for all countries - including the US - to “step up and fulfill the Paris Agreement." In one of the most ambitious emissions plans published by a developed nation, the Swedish government has reaffirmed the urgency of tackling climate change, ignoring uncertainties about global policies under Donald Trump’s administration.
- This proposal, co-authored by conservative thinkers Martin Feldstein, Henry Paulson Jr., Gregory Mankiw, Ted Halstead, Tom Stephenson and Rob Walton, outlines a climate solution based on a sound economic analysis that embodies the conservative principles of free markets and limited government. It consists of four pillars: (1) a carbon tax to reduce emissions, (2) A “carbon dividend” payment, distributed to the American people on a quarterly basis, (3) a border adjustment for carbon content offering rebates for American companies exporting products and fees for carbon content of imported goods from other countries, and (4) the eventual elimination of regulations no longer necessary after the enactment of a carbon tax.
- From stranded assets to increasing credit risks to missed opportunities in renewables, climate change could have a profound impact on banks. But, according to a recent report by Boston Common Asset Management, many banks are falling behind when it comes to assessing climate risk and only a few banks are performing environmental "stress tests." The report shows, however, that banks have improved in adopting climate strategies, and 23 out of the 28 banks surveyed implemented substantive policy changes related to climate-risk since 2015. In addition, over 80 percent of the banks have adopted more explicit oversight of climate risk at the board level.
- On November 1-2, 2016, a dynamic group of endowment leaders convened at Loyola University Chicago to connect with their peers and learn from investment experts about the fast-evolving field of sustainable investing -- covering a broad range of concepts and strategies including ESG integration, impact investing, mission-aligned investing, shareholder engagement and more. Participants heard from a variety of high-level speakers, including Former Treasury Secretary Hank Paulson, as well as David Blood of Generation Management, Jeremy Coller of Coller Capital and the Farm Animal Investment Risk & Return (FAIRR) initiative, and more. Visit the Forum page for more details on the event including links to presentations and videos of speaker sessions.
AASHE is offering cost-free support for up to five campuses to develop and implement on-campus (or near campus) solar projects. Support will include site screening, stakeholder education, RFP development and support, and contract negotiation support. One page applications are due March 17th. More information is available in the recording of their recent webinar.
- NEPC, LLC, one of the industry’s largest independent, full-service investment consulting firms to endowments and foundations, today made public the results of its Q4 2016 NEPC Endowment and Foundation Poll, a measure of endowment and foundation views on the economy, investing, and key market trends. The results show a significant increase in investor confidence, with 64% of respondents saying the US economy is in a better place now than at this time last year. This was a dramatic change from last quarter, when 25% indicated the same sentiment, and it was the second highest confidence reading since NEPC launched this survey in 2013. Only 7% of respondents this quarter feel the US economy is in a worse place now than one year ago.
- The hotly competitive returns of college endowment performance are out, and the results have again shaken the higher education elite down to their Ivy League roots: The smallest endowments — those with total assets under $25 million — outperformed their billion-dollar-plus rivals for the second year.
- The University of Cambridge has become embroiled in an internal battle after executives at the UK’s richest educational institution clashed with academics over proposals to divest from fossil fuels.Last month the university’s governing body, which is made up of senior academic and administrative staff from its 31 colleges, passed a motion to divest Cambridge’s £5.8bn endowment from fossil fuels. In an unprecedented break from university tradition, Cambridge’s council, its executive arm that sets policy, has said it will not follow through with the governing body’s calls for divestment within the next 12 months.
- Nearly 10 percent of the Grinnell College student body occupied the Nollen House and the office of President Raynard Kington during a sit-in last week, working to convince him to endorse divesting the portion of Grinnell College's endowment in fossil fuels. "Our President has a choice to stand with the Trump administration or he can stand with students and Iowa community members. Climate change is real, and it's a crisis," one student said.
- The UC-wide protest, held last week across all nine UC campuses, was sparked by President Donald Trump’s approval of the Dakota Access Pipeline construction, reversing the decision made in the last month of President Obama’s term. Students gathered on to express outrage against the order and urge the UC regents to take a stand by divesting the remaining $1.7 billion invested in fossil fuels by the UC system. The total $1.7 billion supports both the Dakota Access Pipeline and fracking across the state.
- In this guest column, Matthew Countryman, a Yale alumnus ('86), discusses the movement in the 70s and 80s to divest from South Africa and how that movement and its results compare to the fossil fuel divestment movement and the political climate today.
- A controversial petition that urges the USF Foundation to divest from "companies complicit in human rights violations," among other issues, is being pushed for placement as a referendum on the Student Government (SG) election ballot next month. The petition, titled "USF Divest From Fossil Fuels, Private Prison and Companies Complicit in Human Rights Violations," also calls for the Foundation to divest from companies that have a direct connection with contributing to the use of fossil fuels, funding private prisons and investing "in human rights violations in Palestine and Yemen."
- This week, Tulane's Undergraduate Student Government passed legislation that calls on the University to divest funds from fossil fuel companies. The debate around this resolution lasted around 40 minutes and led to a 27-6-1 vote in favor. A significant part of this resolution was based on a referendum in Spring 2016 of around 2,100 students which led to a 54 percent to 28 percent result in support of divestment.
- Oregon State University affiliates have taken two steps to advance the divestment movement targeting fossil fuel companies. The OSU Board of Trustees voted 11-0 in late January to approve an amendment to the state Public University Fund Investment Policy that calls on the fund to divest its current intermediate and long-term assets in fossil fuel-related stocks, and to restrict future investment in those assets. In a separate action, the OSU Foundation recently agreed to establish a second portfolio for donors that will be free of fossil fuel holdings. The foundation decided it was best to give donors the choice of where their money goes, said OSU President Ed Ray.
- Ithaca College currently has about 2.1 percent of its $270 million endowment invested in fossil fuels, said Janet Williams, interim vice president for administration and finance. Williams said the college does not want to divest from fossil fuels because it would require changing the college’s investment policies and portfolio. She said the current portfolio and policies allow for the college to participate in sustainable practices like the solar array, which went live in November, LEED Certified buildings and environmental research.
- This opinion piece outlines The University of Marylands involvement with Maryland Correctional Enterprises, the history behind the issue, and the movement to divest from all involvement.
Investment Manager & Strategies News
Deutsche AM Launches Fixed Income ESG ETF l Investment Week
Deutsche Asset Management is launching a fixed income ETF focusing on investing in ESG corporate bonds. To be included, index bonds have to be investment-grade rated and be at least €300m in size as well as meeting the ETF's SRI requirements.
- MSCI Inc., a leading provider of research-based indexes and analytics and the world’s largest provider of environmental, social and governance (ESG) indexes2, announced today the launch of new MSCI ESG Universal Indexes and the renaming of two MSCI ESG Index families. The MSCI ESG Universal Indexes are designed to enable pension funds, endowments and other asset owners to better focus on ESG issues in their investment decision-making processes.