Weekly News Round-Up: May 4th, 2018

 
Weekly News Round-Up: May 4th, 2018

Below please find this week's news round-up.

Don't forget to register for our Community Impact Investing Roundtable on June 11th at The Boston Foundation-- registration is open here! (Please note that at this time only asset owner seats are available.)

Also, be sure to register for next week's IEN webinar exploring the importance of ESG data & corporate engagement, taking place on Thursday. 

Have a great weekend,

Nicole

Program Manager
The Intentional Endowments Network

 
IEN in the News

 University Endowment Funds Face Increasing Pressure to be More Sustainable l Financial Times

  • This article discusses the findings from the annual survey by the National Association of College and University Business Officers (Nacubo). The most recent survey found that while the adoption of responsible investing was “growing gradually”, it was uneven from year to year. The article features a quote from IEN Principal Georges Dyer.

 Perspectives on DOL Field Assitance Bulletin l IEN Blog

  • This IEN blog post, written by Keith L. Johnson, Heads of Institutional Investor Legal Services, Reinhart Boerner Van Deuren s.c., Member of the IEN Executive Committee, and Chair of the IEN Fiduciary Duty & Policy Working Group, discusses how investor fiduciaries should be careful not to overreact to Employee Retirement Income Security Act (ERISA) Field Assistance Bulletin 2018-01 on the exercise of shareholder rights and consideration of ESG factors, which was issued by the Department of Labor (DOL) on April 23, 2018.
 
Sustainable Investing at Endowments, Foundations & Pensions

Want Your Endowment to Grow? Try Diversifying Your Investment Team l The Chronicle of Higher Education

  • This article highlights how, by strengthening the diversity of their investment managers, colleges can not only bring investment policies in line with their core mission, they can potentially increase the returns on their endowments.

UC Administration to Reinvest $500 Million Away from Fossil Fuels l The Guardian

  • In the UC Office of the President investments subcommittee meeting held March 13, UC Chief Investment Officer Jagdeep Singh Bachher declared that of the three percent of UC stakes in fossil fuels, $500 million, would be reallocated away from nonrenewable energy sources. The decision was credited to fiscal reasons in conjunction with ongoing efforts made by the Fossil Free UC campaign but included no timeframe of implementation.

Sweden’s Largest Pension Plan’s $200 Million Anchor Commitment Rockets Co-Impact Fund Above Target l Chief Investment Officer

  • Alecta, Sweden’s largest pension fund, has committed a $200 million anchor investment for an impact fund co-investing in emerging market loans, overshooting the fund’s target by $50 million. Closing 25 percentage points above target at $250 million, the new fund is a collaboration of NN Investment Partners ($296 billion) and the investment arm of Dutch bank FMO ($10 billion).
 
 Opportunities for Action

US SIF Foundation Opens 2018 Survey on US Sustainable, Responsible and Impact Investing Trends l Digital Journal

  • US SIF Foundation announced today that the window for the 2018 Biennial Trends Survey is now open. The survey will provide data for the 2018 edition of its Trends report.  For reference, please see the 2016 report and this piece showing Highlights from Educational Institutions. To request a customized link to participate, contact the US SIF research team at trends@ussif.org. All survey responses are confidential. 

Proxy Season Sign-On Opportunities

 
Student-Managed Fund News 

Investing Sustainably: Students at Smith College Launch New Fund l Grecourt Gate

  • A multinational package delivery company, an engineering consulting firm and a water technology provider will receive the first investments from a new $100,000 fossil-fuel-free innovation fund managed by the Smith College Investment Club. Following a recommendation of Smith’s Study Group on Climate Change, the college last fall provided $100,000 for the student-managed fund, which avoids investing in companies whose main source of revenue comes from fossil fuels, tobacco products, firearms or toxic chemicals. Investment criteria developed by students also include industry-specific standards for employee relations, worker safety and company leadership, among other issues.

 

Sustainable, Responsible, Impact & ESG Investing

Bloomberg Brief l Sustainable Finance

  • This week's Bloomberg Brief highlights how a backlash against coal is, surprise, making coal miners even richer; Companies are on a renewables buying binge; The city bus sector could go from diesel to almost entirely electric within a decade, according to Proterra CEO Ryan Popple. 

New Issue Areas Attracting Impact Investors, And Why l Forbes

  • In this Q&A article, the author sat down with Katherine St. Onge, Director, Syndications and Institutional Partnerships, at Calvert Impact Capital, and discussed what new issue areas are attracting impact investors – and why.

The Case for Investing in Green Companies l Kellogg Insight

  • In a new paper, Kellogg researchers argue that paying attention to firms’ sustainability—captured by ESG criteria—can actually improve the share price. Green companies may not be raking in the cash now, but they are more likely to outlast sudden industry shake-ups, such as new pollution regulations or consumer-driven demand for eco-friendly products.

Pain Killers: How Can Impact Investors Help Stop the Opioid Addiction Epidemic? l Impact Alpha

  • This podcast features an interview with Imogen Rose-Smith, an investment fellow at the University of California, who discusses how the opioid epidemic will land at investors’ feet soon enough, with investors currently grappling with what capital markets are doing to perpetuate or profit from the addiction crisis, and how drug and other companies may take hits for their eventual liabilities.

Impact Investing Must Resolve its Identity Crisis l Financial Times

  • This article highlights how outside of a few buzzwords — ethical, sustainable and so on — there is no consensus as to what impact investing is. A 2017 survey conducted by the Global Impact Investing Network reported $114bn in assets under management. In 2017, the Sustainable Investment Forum estimated the global size at $22.9tn. The author discusses how the two groups cannot be talking about the same things.

Sustainable Investing Themes of ‘Climate’ and ‘Carbon Reduction’ Gaining Favor Among Fund Investors l South China Morning Post

  • This article highlights how investors should channel money into growth sectors such as education, health, and clean energy if they choose to withdraw from companies scoring poorly on the environment, social and governance issues, according to experts in sustainable investment. 

Private Equity Drives Value Creation Through Sustainable Investment l ESI Africa

  • The pan-African industry association, African Private Equity and Venture Capital Association (AVCA), has released a special report, which looks at the history and evolution of responsible investing in Africa. The report, titled An Untold Story: The Evolution of Responsible Investing in Africa, was released at the 15th Annual AVCA Conference which was held on 23rd and 24th April in Marrakech.
 
Shareholder Engagement

29% of Starbucks’ Shareholder Votes Support As You Sow Proposal on Plastic Straws, Packaging Reuse, and Recycling l As You Sow

  • Nearly a third of Starbucks’ shareholders at the company’s Annual General Meeting last week supported an As You Sow resolution asking the company to phase out the use of plastic straws and develop aggressive plans to meet packaging reuse and recycling goals. More than 29% of shares voted (271 million shares), with a market value of $54 billion, to support the proposal. This vote far exceeds the average support of 21.5% for environmental proposals. The proposal was presented on behalf of As You Sow by actor, filmmaker and UN Environment Goodwill Ambassador Adrian Grenier.

What Happened To The Recyclable Cup Starbucks Promised Us Back in 2015? l The Dieline

  • In 2017, As You Sow, the nation's non-profit leader in shareholder advocacy, called Starbucks out for its single-use plastic cups, shortcomings with previous sustainability promises, and failure to phase out their signature green plastic straws. As of March 20, 2018, Starbucks has taken another ambitious approach and partnered up with Closed Loop Partners to develop a recyclable, compostable cup in hopes of cutting back on the 600 billion disposable cups doled out each year.
 
Fiduciary Duty

U.S. Impact Investing Alliance Statement on Department of Labor ESG Guidance l US Impact Investing Alliance

  • This statement discusses the implications of the Department of Labor's recently published a “Field Assistance Bulletin” providing guidance to fiduciaries of private-sector employee benefit plans. The note served as a clarification related to the DOL 2015 guidance on economically targeted investments and the DOL 2016 guidance on shareholder engagement. While remaining clear that fiduciaries must prioritize financial returns, the DOL confirmed that pension managers can and should feel comfortable using ESG factors as an input in evaluating potential risk and financial return.

US SIF Comments On DOL Field Bulletin On The Fiduciary Standards Under ERISA l US SIF

  • US SIF played an important role in the advancement of the 2015 and 2016 DOL guidance, and consequently, has received inquiries from US SIF members and media representatives for their analysis of the bulletin, which is outlined in this article.
 
Investment Firm News

Al Gore’s Generation Investment Management Builds the Investment Case for Sustainability l Impact Alpha

  • Generation Investment Management, the $19 billion public and private equity investment firm co-founded by the former vice president, isn’t just calling the ‘Sustainability Revolution.” It’s building the business case for sustainable investing, starting with its own returns.

Cambridge Associates’ Client Portfolios More than Double ESG Investments in Five Years l Globe News Wire

  • Assets placed in ESG investments in Cambridge Associates’ client portfolios have more than doubled over the past five years to approximately $9.5 billion from $4 billion in 2012. Further, more than 130 of the global investment firm’s clients, including endowments & foundations, pensions and families have already invested in ESG and impact strategies. And a recent survey of Cambridge’s endowment & foundation clients shows that  61% of them plan to increase their impact-oriented allocation over the next five years.

Financial Services Giants Launch ESG Indices l Financial Standard

  • J.P. Morgan and BlackRock have joined forces to create the J.P. Morgan ESG Index (JESG), which aims to meet bond investors' growing demand for a benchmark that targets emerging market issuers with strong ESG practices. The index, which is independently managed by J.P. Morgan, caters to investors looking to gradually incorporate ESG and responsible investing in their overall fixed income investment strategies.

CFS Partners to Create ESG Fixed Income Fund l Financial Standard

  • Colonial First State has launched a new fund with ESG and impact bond manager Affirmative Investment Management (AIM). The Affirmative Global Bond fund will invest in fixed income and cash assets where both the issuer and issues have passed an ESG and impact screen.
 
Climate Risk & Clean Energy

Major European Banks Are Backing Away From The Oilsands. Will Others Follow? l Huffington Post

  • The decision by Europe's largest bank, HSBC, to halt funding for new projects in the oilsands has some wondering if other financial institutions, including U.S. banks and pension funds, will eventually follow suit — and what the impact that might have on Canada's energy sector. HSBC last Friday became the latest European bank to announce that it would no longer finance new greenfield oilsands, coal power plant and arctic drilling projects. It follows BNP Paribas and ING, both of which made similar announcements in the past year.

The People Who’ll be Most Hurt by Climate Swings Did the Least to Cause Them, Study Says l The Washington Post

  • In a study released Wednesday, scientists have gone further in documenting what they call climate-related “inequality.” They found that tropical countries, which tend to be poorer and to have contributed less to climate change, are set to disproportionately suffer one of the more severe effects of climate change: major swings in temperature. 
 
General Higher Education Endowment & Sustainability News

A Look Into Whitman’s Endowment l Whitman Wire

  • This article features a look into the breakdown of Whitman's endowment, as well as a Q&A with student Meg Rierson ‘18 where she discusses her thesis “Endowments and the Elite: A Political Economic Analysis of the Whitman Endowment.” Seeking to examine whose interests the Whitman endowment really serves, Rierson combined an analysis of interviews with those involved in the financial activities of Whitman with the work of various scholars on late capitalism, higher education and financialization.

Hedge Funds Are Columbia's Big Bet in $10 Billion Endowment l Bloomberg

  • Columbia University’s $10 billion endowment has invested a third of its assets in hedge funds at a time when other large investors are chasing low-cost passive funds. The fund had 33 percent of its portfolio in hedge funds as of June 30, when its fiscal year ends, according to a bond document.

Red, Blue—And Green: American University Achieves Carbon Neutrality l American University

  • This article discusses how AU has become carbon neutral two years before its 2020 goal.

George Mason University Uncovering Koch Role in Faculty Hire l Inside Higher Ed

  • In defending its financial ties to the Charles Koch Foundation -- some $50 million worth, as of 2016 -- George Mason University has cited its academic independence from donors. Yet George Mason is less independent than it has let on, according to documents released last week via an open-records request, and amid an ongoing suit about donor transparency brought by student activists.
 
  
Fossil Fuel Divestment
 Divest-Invest Commitments in the UK l Emissions Impossible
  • This article lists the 65 university divest-invest commitments as of early April 2018.

Swarthmore Professors Fast to Demand Use of Endowment for 'Social Objectives' l Campus Reform

  • Three Swarthmore College professors are taking turns fasting for a full week in hopes of pressuring the school's Board of Managers to repeal a 1991 policy forbidding the use of the endowment to advance "social objectives." The policy presents a major obstacle to a student referendum passed last week, which calls on Swarthmore to completely divest all of its holdings in the fossil fuel industry.

Divestment Doesn't Change Company Behavior, Pension Managers Say l Bloomberg

  • Managers of the California State Teachers’ Retirement System and the New York State Common Retirement Fund said they oppose divesting from controversial companies because it doesn’t change corporate behavior.

Majority of Surveyed Faculty at Harvard Support Fossil Fuel Divestment, Social Group Sanctions l The Crimson

  • According to this article, a significant majority of the Harvard Faculty of Arts and Sciences—67 percent—believe the University should divest from fossil fuels.
 
Calendar of Upcoming Events
  • In this webinar, panelists will be discussing the importance of standardized and publically available ESG data, as well as initiatives, tools and resources to promote ESG data disclosure, and examples of investors engaging in this work. Participants will also learn how shareholder engagement can improve ESG data availability and how they can participate in the engagement process.

Mission Forward! MIE’s 2018 National Conference l Mission Investors Exchange, May 14-16, 2018, Chicago, IL

  • This conference offers an action-focused, collaborative, and personal space for foundations to renew and build partnerships, experience on-the-ground impact investments, share investment opportunities, meet leading voices in the field, and shape the future of the impact investing movement.

Davos on the Delta l iSelect Fund, May 15-17, 2018, Memphis, TN

  • This ag industry event will feature presentations, group discussions, and one-on-one networking, and participants will explore the changing agriculture landscape and the new opportunities it is creating across the value chain. 

IEN Roundtable: Community Impact Investing l Intentional Endowments Network, June 11, 2018, Boston, MA

  • The Intentional Endowments Network will host a Community Impact Investing Roundtable focused on opportunities for place-based investing. The Roundtable will convene endowment and foundation decision-makers and other stakeholders interested in enhancing their leadership on sustainable investing.

Confluence Philanthropy's 2018 Advisors Forum l June 19-20, 2018, New York, NY

  • The Advisors Forum will convene Confluence members and colleagues to explore how we can work together to scale the impact industry. Discussions will focus on cutting-edge themes including investing in diversity, inclusion, and equity; sustainability; and barriers to deal flow. IEN members will receive the member rate to participate.

The 29th Annual SRI Conference l November 1-3, 2018, Colorado Springs, CO

  • The SRI Conference is the longest-running annual gathering of investors and investment professionals working to make money and direct the flow of investment capital toward a truly sustainable future.