Weekly News Round-Up: March 15, 2019

Please find this week's news round-up below.

 

 
 

As Nicole noted last week, beginning today I will be sharing the latest news of interest to the IEN community with you every Friday. Please do let me or Nicole know if there is content you'd like to see, resources you can share with the community, or other feedback.

It has been a big news week for higher ed and climate! Below are some of the stories you may have missed amid the deluge of stories on the college admissions scandal and today's global student strike for climate action, including new analysis of data from the 2017 NACUBO-Commonfund Study of Endowments, which found that college and university endowments that use SRI strategies can produce long-term returns that are approximately equal to those of non-SRI users.

If you missed today's webinar on "Deforestation, A Climate Risk That Can Be Addressed," you can view the recording anytime here. While you're on the IEN website, please also take a look at IEN's latest resource, a primer on Gender Lens Investing released last Friday.

Have a great weekend, 
Hannah

Hannah Bowen
Network Manager, The Intentional Endowments Network
www.intentionalendowments.org

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New IEN Members
 
Opportunities for Action

Survey on Boardroom Diversity l Thirty Percent Coalition

  • The Thirty Percent Coalition works to ensure the senior leadership and boards of directors of US Corporations reflects the gender, racial and ethnic diversity of the United States workforce. They are undertaking a short survey of investors in order to catalog their current proxy voting approaches to boardroom diversity. The survey has 11 questions and should take no more than a few minutes to fill out. Investors can complete the survey using this link. The survey is open to all investors who vote their proxies (or direct others to do so on their behalf). Please contact IEN Steering Committee member Lisa Hayles at Boston Common Asset Management with any questions. Deadline for responses is TODAY - March 15th.
 
 
New Resources & Reports

Webinar Recording: Deforestation, A Climate Risk That Can Be Addressed l Intentional Endowments Network

  • In this webinar, Leslie Samuelrich, President of Green Century Capital Management, Jeff Conant, Senior International Forests Program Manager at Friends of the Earth, and Matt Piotrowski, a Senior Analyst at Climate Advisers introduce deforestation, discuss why it is an important factor investors should consider when measuring risk, and share research outlining the materiality of deforestation.

Proxy Preview 2019 | As You Sow, Sustainable Investment Institute, and Proxy Impact

  • Released March 12, the 2019 edition of this annual report summarizes data on hundreds of shareholder resolutions - including environmental, corporate political spending, human rights, diversity, sustainable governance issues, and much more. Free with registration.
 
Sustainable Investing By Institutional Asset Owners

Norway Sovereign Wealth Fund, World’s Biggest, To Dump Oil and Gas | The Local Norway

  • Norway's sovereign wealth fund, the world's biggest, will sell off stakes in oil and gas exploration and production companies to reduce its exposure to black gold, the government said on Friday. While the decision is based solely on financial considerations and not on the environment, a divestment -- even partial -- by an investor worth more than $1 trillion was seen as a major blow to the fossil fuels industry and hailed by the environmental lobby.

CIOs and Asset Owners Discuss Fossil Fuel Divestment | Chief Investment Officer

  • A deep dive into those who have divested and done well, not so well, and those who have considered divesting, but haven't. Highlights the experiences of IEN members Sierra Club Foundation, Rockefeller Brothers Fund, Perella Weinberg Partners, and Cambridge Associates. Available with free registration.

Two Massive Victories for the Student Divestment Movement in the UK | Bright Green

  • Two UK-based institutions joined the more than 1,000 worldwide that have cut their ties with the fossil fuel industry. Clare Hall College, Cambridge announced it will divest its £26 million endowment from fossil fuels. This followed the University of Stirling making a similar commitment a day earlier. In doing so, Stirling became the 72nd university in the UK to divest from fossil fuels.

Church Pension Fund Uses ESG Analysis to Award Mandate | Markets Media

  • In assessing funds, the Evangelical Lutheran Church of Finland has begun asking for each fund’s Principles for Responsible Investment (PRI) assessment reports as well as using data analysis on ESG factors from Impact-Cubed. The Church pension fund was established in 1991 and has practiced responsible, or ethical, investment since its launch, and committed to the UN PRI in 2008.
 
Sustainable, Responsible, Impact & ESG Investing

Seeing SRI in Context | Business Officer Magazine

  • A new analysis of data from the 2017 NACUBO-Commonfund Study of Endowments finds that college and university endowments that use socially responsible investing strategies can produce long-term returns that are approximately equal to those of non-SRI users. After even deeper analysis, NACUBO found that SRI users with endowments in the “over $1 billion” category realized statistically significant higher average one-year returns (13.5 percent) compared to non-SRI users (12.7 percent). This finding is evidence that using SRI can be advantageous for some institutions.

(Listen) 'Impact Investing': Good For The Planet, Good For Profit? | WBUR

  • Host Meghna Chakrabarti discusses impact investing with guests Marc Gunther, author of the four-part series "Good Returns" on impact investing in the Chronicle of Philanthropy; Deval Patrick, managing director and co-managing partner of Bain Capital Double Impact, the social investing wing of Bain Capital; and Andy Posner, founder and chief executive officer of the nonprofit Capital Good Fund, which offers small personal loans, financial services to help end endemic poverty. Includes a list of links for further reading.

ESG-focused Asset Managers to Benefit from New Disclosure Rules | Investment Executive

  • The EU has adopted new rules for sustainable investment disclosure. “The rules aim to eliminate ‘greenwashing,’ the practice of making misleading claims about investment products’ sustainability characteristics, and to provide investors more clarity on ESG investments. They require asset managers in the EU to report ESG risks and opportunities as part of their fiduciary duty,” Moody’s said.

The What and Why of Impact Investing: Interview With Nancy Pfund, Founder & Managing Partner Of DBL Partners | Clean Technica

  • Interview with the founder of IEN member DBL Partners. Nancy Pfund created the venture capital firm DBL Partners with the goal to combine top-tier financial returns with meaningful social, environmental and economic returns in the regions and sectors in which it invests. She helped launch the ‘impact investing’ movement that is growing every year and is ready for a revolution.

Boston City Councilors Eye Pension Fund Divestment, Reinvestment | Next City

  • Following the Mayor’s announcement of a plan to invest $150 million of city operating funds using ESG criteria, the Boston City Council held a hearing on whether the municipal pension fund’s investment strategy can better reflect the city’s goals on racial equity, climate change resilience and more. Panelists including IEN members Trillium Asset Management spoke about the options for socially responsible investing.

Here’s how investments can make money and help the environment | CNBC

  • Even as the number of sustainable investment strategies grow, old biases persist about whether you have to sacrifice returns. Experts weigh in on whether there is any truth to those fears, and what is holding financial advisors back from putting clients’ portfolios entirely in these assets. According to the latest research from Morningstar, in 2018 sustainable funds outperformed benchmarks, with 63 percent landing in the top half of their categories, the investment research company found.

Getting a handle on investing options in the age of accelerating climate change | CNBC

  • Argues that by viewing companies through a climate lens, such as water stress, we can augment our traditional investment view that is anchored on financial statement analysis and factor in the proactive steps that companies are taking (or not taking) to gain a more nuanced assessment of a company’s fair value and future earnings potential.

Companies, Investors and the Global Community All Stand to Gain from ESG Investing | Money Management

  • Overview of the evolution and future of ESG investing, from investment research to constructive dialog with portfolio companies.

The Many Names and Global Reach of Socially Responsible Investing | University of Virginia Darden School of Business

  • Summary of a recent technical note by UVA Darden School of Business Professor Mary Margaret Frank on the growth of socially responsible investing from about $2.71 trillion in assets under management in 2007 to $21 trillion by 2014 and further growth since, with about $12 trillion under management in the United States alone, as of the end of 2018; as well as new research from Professor Pedro Matos and Darden’s Richard A. Mayo Center for Asset Management on how global capital flows are impacting ESG investments.

A Taxonomy of Sustainable Funds | Morningstar

  • Summary of a report categorizing funds into four categories: ESG consideration, ESG integration, impact, and sustainable sector. Login required to access report.
 
Shareholder Engagement

State Pensions Fought Guns and Tobacco. Why Aren’t They Divesting From Opioids? | Bloomberg

  • Funds including California’s and New York’s say they generally oppose divesting from controversial companies because it doesn’t change corporate behavior. Instead, they say they try to engage with management through activist measures. The California State Teachers’ Retirement System, CalSTRS, has been active with a group called Investors for Opioid Accountability, which represents 54 institutions. New York’s fund said it has asked opioid manufacturers to address potential financial, legal and reputational risks.

Opinion: Are Corporations Really Afraid of Shareholder Proposals? | Philadelphia Inquirer

  • Friends Fiduciary Corporation argues against the SEC’s proposed rule changes that would weaken shareholders’ ability to offer resolutions that guide company activity.
 
Diversity, Equity, and Inclusion

Five Practices for Developing and Staying Accountable to Racial Equity Goals | Stanford Social Innovation Review

Busting the Myths of Impact Investing | Multihousing News

  • Interview discussing the misconceptions surrounding impact investing, particularly when it comes to low-income housing communities. Pension funds and endowments mostly have participated through traditional development programs. However, more endowments and foundations may start increasing the volume and continue their investment in impact-related affordable housing. The trend towards impact investing has received some support from the pensioners and students at schools with large endowments.
 
Gender Lens Investing

Gender Equality ETF Still Going Strong | Benzinga

  • On March 7, the SPDR SSGA Gender Diversity Index ETF celebrated its third anniversary. SHE, one of the first exchange traded funds to emphasize gender equality investing principles, has been successful and is now home to about $350 million in assets under management. One of the fund's primary objectives is to provider exposure to companies “that demonstrate greater gender diversity within senior leadership than other firms in their sector,” according to State Street. Scores of data points and research suggest that brands and companies with women in pivotal roles, including C-level executive roles, outperform their less diverse rivals.
 
Green Bonds

Green Bonds May Have Halo Effect | Markets Media

  • There is increasing evidence that the issue of a green bond could lead to lower long-term financing costs and have a positive impact on share prices according to a panel at the Climate Bonds Initiative annual conference. Dr Arthur Krebbers, sustainable finance co-ordinator – NatWest Markets, said there is increasing evidence of a green bond ‘halo effect.’ He spoke on a panel on green bond pricing at the conference in London last week.
 
Investment Firm News

Institutional Money Comes To ESG ETFs | ETF Report

  • Over the past two weeks, more than $1 billion in institutional money has poured into socially responsible ETFs, leading many to wonder whether environmental, social and governance (ESG) investing has finally "hit it big."

Vanguard Offers Its First Active ESG Fund | Institutional Investor

  • The Vanguard Group will soon begin offering its first actively managed fund based on environmental, social, and governance criteria. Vanguard is known for low-cost passive investing strategies, including index-based ESG funds that use exclusionary screening. The new actively managed fund will integrate proxy voting and company engagement, possibly holding stocks that some exclusionary ESG strategies would block from their portfolios.

State Street Announces ESG-Focused Partnership with Professor George Serafeim of Harvard Business School | Business Wire

  • State Street Corporation announced a new partnership with George Serafeim, professor of Business Administration at Harvard Business School, to advance its research agenda in ESG investing on behalf of its clients. Widely published and recently recognized by Barron’s as “one of the most influential people in ESG investing,” Serafeim’s research focuses on measuring, driving and communicating corporate performance and social impact as well as the practical integration of ESG criteria into investment management.

BMO GAM Bolsters Responsible Investment Team with Three New Hires | Investment Europe

  • BMO Global Asset Management has appointed Nina Roth, Alan Fitzpatrick and Derek Ip to its Responsible Investment team, reporting to team co-heads Claudia Wearmouth and Alice Evans. Changes to the Responsible Investment Advisory Council also include Marga Hoek stepping down, to be replaced by Elizabeth McGeveran, director of Investments at the McKnight Foundation, and internal representative Martin Smith to be replaced by Phil Doel, director in the Fundamental Investment and EMEA Investment Management team.
 
Climate Risk, Science, and Regulation

San Francisco’s Version of a Green New Deal Is Taking Over Its Power Company | Bloomberg

  • City officials are studying the possibility of creating their own utility out of PG&E Corp., the energy giant that filed for bankruptcy in January. The city would buy the company’s local wires—or possibly seize them through eminent domain. The San Francisco Public Utilities Commission already operates a series of hydroelectric facilities that bring water and power to the city. Until recently, that power mostly supplied city agencies and buildings, while PG&E served residents and businesses. Achieving 100 percent green power would require more wind and solar farms—which would in turn create more jobs.

Global Climate Strikes Are Happening Now. Young Environmental Activists Skip School in a Call to Action | CNN

  • Tens of thousands of students worldwide are walking out of class Friday and piling into the streets, demanding that world leaders take action on a threat to their survival -- climate change. In a movement spanning more than 100 countries and more than 1,500 cities and towns, students are going on strike.

16-year-old Climate Activist Greta Thunberg Nominated for Nobel Peace Prize | Mashable

  • Because of her efforts to combat climate change and save the planet — and inspire young people around the world to do the same — the Swedish teen has been nominated for a Nobel Peace Prize by three Norwegian lawmakers. 
 
 
General Higher Education Endowment News

Beginning in Fall, Tuition Will Be Free for Up to 1,000 Students at San Bernardino Valley, Crafton Hills Colleges | The Sun (San Bernadino)

  • The Free College Promise program will give 1,000 qualifying students two years of free tuition at SBVC or CHC, free textbooks, $300 cash for college expenses, free access to a laptop for coursework, individualized advising and priority course enrollment. Funding for the program comes from a $10 million endowment established in October by the trustees.

Yale Boosts Venture Capital Bet to Almost a Fifth of Endowment | Pensions & Investments

  • The fund with a record $29.4 billion boosted its venture allocation to 19% as of June 2018 from 17.1% the prior year, according to the school's annual investment report published online. The allocation was 13.7% in 2014. Yale, one of the most-watched institutional investors, helped pioneer a pivot to alternatives more than three decades ago.

Broken Trust: Texas’ Huge School Endowment Pays Out Less and Less for Schoolchildren | Houston Chronicle

  • The $44 billion Texas Permanent School Fund is the largest education endowment in the country, but the state's K-12 public schools are seeing less money than they did decades ago. A four-part investigative series by the Houston Chronicle looked at why the endowment, which was created in 1854, has reduced its distributions to schools, including complex governance structures and changes in investment strategy.

Duke Endowment Grants $24 million to Davidson College for Scholarship Program | Charlotte Observer

  • The Charlotte-based Duke Endowment on Thursday announced a $24 million grant to Davidson College that will expand a scholarship program that recruits students with “exceptional abilities” to the liberal arts school. The grant is the fourth-largest donation in the college’s history, which dates to 1837. The foundation grant pushes a $425 million fundraising campaign that Davidson launched in 2014 past the $500 million mark with three months left in the campaign, the college said. Half of the money raised will pay for scholarships.
 
Private Prison Divestment

JPMorgan's Private Prison Pullback: A Generational Shift, or Low-Risk Lip Service? | Fortune

  • Analysts say the bank’s decision likely stemmed from a cost-benefit analysis that showed that stepping away from “a few billion dollars worth of loans in exposure” could prove to be “an inexpensive way of shifting the ire of political critics.” Indeed, private prisons are a relatively minuscule portion of the book for major banks, which lent less than $2 billion across three deals for CoreCivic and GEO Group in 2018, per Refinitiv data cited by Reuters, which first reported the news of JPMorgan’s private-prison retreat. The same cannot be said for industries like fossil fuels, which many banks have shown to consider too profitable to sacrifice in favor of ESG values.
 
Fossil Fuel Divestment

Divestment Hurt Apartheid. Can It Save the Planet? | The Washington Post

  • Succinct Q&A about the climate divestment movement, including current strategies, economic and financial arguments for and against divestment.

Yale’s Endowment Won't Divest from Fossil Fuels. Here's Why That's Wrong. | The American Prospect

  • Two climate activists and Yale alumni confront the arguments of Yale's chief investment officer, arguing that he must summon the moral clarity to end support for fossil fuel companies.

Climate Activist Bill McKibben to Cornell Students on Divestment: ‘We Better Get to Work’ | Cornell Daily Sun

  • McKibben emphasized the importance of discussing what has changed since the Cornell board of trustees’ original decision against divestment, instead of chastising them for making the wrong choice. He outlined the seven main developments that have shifted the conversation regarding fossil fuel divestment, such as the increasing economic viability of divestment, and asserted that the responsibility of combating climate change lies with institutions of higher education, who must take charge in light of a “campaign of deception” from the fossil fuel industry.

Associated Student Government passes resolution calling on Northwestern University to divest from the fossil fuel industry | The Daily Northwestern

  • Associated Student Government passed a resolution calling on Northwestern to divest from the top 100 coal and top 100 oil and gas companies — and limit future investments in the fossil fuel industry. The resolution will now be reviewed by Northwestern’s Advisory Committee on Investment Responsibility, a coalition of students, alumni, faculty and administrators. The committee will decide whether to recommend the proposal to the Investment Committee of the University’s Board of Trustees, who will then vote on the resolution.

Op-Ed: Divestment, Not Denial, Will Fix Wash. U.’s Climate Change Complacency Problem | Student Life

  • Student group Fossil Free WashU held a rally and presented a petition with over 1,400 student and 105 faculty signatures, demanding university action on climate change. In this piece, the group makes the case for divestment in Washington University in St. Louis’ almost $8 billion endowment.

Opinion: The Death of Neutrality: Princeton’s Investments in a Politicized Era | The Daily Princetonian

  • A student urges the administration to reconsider its stance on avoiding divestment because of a desire to avoid “institutional position-taking” on politically charged issues.

Students and Faculty Push Administrators on Lack of Transparency During Columbia Senate Plenary | Columbia Spectator

  • Responding to students and faculty about an annual report from the Advisory Committee on Socially Responsible Investing, ACSRI chair Merritt Fox said that given a lack of divestment proposals from the community, the committee will likely not be considering new proposals this semester and will instead follow up on divestment from companies affiliated with the tobacco and fossil fuel industries based on set criteria. Students voiced concerns about the transparency around these criteria, which have not been revised in recent memory. Administrators clarified that the standards were not set for evaluation in the near future.

Student Group Pushes St. Olaf to Divest from Fossil Fuel Companies | Manitou Messenger

  • A new student group, the Climate Justice Collective (CJC), was formed to increase awareness of climate issues and push St. Olaf to divest its endowment from fossil fuel companies and reinvest those funds in socially responsible corporations. St. Olaf’s endowment currently stands at about $520 million.
 
Calendar of Upcoming Events

5th Annual Responsible Investing Summit l Financial Research Associates, April 9-10, 2019, New York, NY

Fundamentals of the Opportunity Finance Industry/Certificate in Community Development Finance Course l  Center for Impact Finance at the University of New Hampshire & Opportunity Finance Network, April 10-12, 2019, Durham, NC

National Conference on Trusteeship | Association of Governing Boards of Universities and Colleges, April 12-14, 2019, Orlando, FL

Student Conference for Corporate Responsibility l Yale's Dwight Hall SRI Fund and The Intentional Endowments Network, April 13-14, 2019, New Haven, CT 

Total Impact Philadelphia 2019 l Total Impact, May 1-2, 2019, Philadelphia, PA 

Intentionally Designed Endowment Roundtable at Total Impact Philadelphia | May 2, 2019, 1:00 - -5:00 p.m. ET, Philadelphia, PA

Davos on the Delta l iSelect Fund, May 14-15, 2019, Memphis, TN

 

 

 

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