Weekly News Round-Up: June 7, 2019

This week the News Round-Up has a new feature! Going forward, we will begin recognizing renewing members more regularly along with listing new members. To kick off this new section of the weekly round-up, this week we're featuring IEN members who renewed in the first quarter of 2019.

Renewing IEN Members

The network appreciates the continued engagement of:

 

 

IEN in the News

(Listen) Sustainable Investing and Divestment | Campus Energy Podcast

  • Hear from IEN members Claire Veuthey of OpenInvest and Mike Fiorio of Northland College’s Board of Trustees about their experience with sustainable investments and how to make financial choices that reflect planet-forward values. Claire, the director of ESG & Impact at OpenInvest, a startup devoted to socially responsible investing, walks through the management of funds and investments and how they can become more sustainable. Mike discusses how Northland’s Board of Trustees reached their decision to divest from fossil fuels, and the importance of listening to student voices in balance with the university’s financial interests.
 

Opportunities for Action

Moskowitz Research Prize | Berkeley Haas School of Business and US SIF

  • Deadline: June 30, 2019. The Moskowitz Prize recognizes outstanding research on responsible investment and the financial implications of responsible business practices in capital markets. The prize-winning study is selected by a panel of judges from academia and the investment industry Judging criteria include: Significance to practitioners of sustainable and/or responsible investment; Innovativeness of research question and approach; and Appropriateness and rigor of methods.

SRI Conference Student Scholarship l FAFN Emeriti

  • Deadline: July 8. This scholarship was started and is coordinated by a group of First Affirmative Financial Network emeriti and longtime affiliates to bring young people to The SRI Conference. Winners will be announced in late September. For questions or additional information on this program, please contact SRIscholarship15@gmail.com, and to apply, follow the link above.

Survey: What is the standing of the sustainable finance & ESG community within the wider investment world? | Sustainable Finance Network and Responsible Investor

  • Deadline: June 21. The Sustainable Finance Network has teamed up with Responsible Investor to run a fully anonymous survey on how sustainable finance professionals are being valued. Survey should take 5-7 minutes to complete. Research findings to follow.

2019 Proxy Memos and Exempt Solicitations | Interfaith Center on Corporate Responsibility

Proxy Voting Guidebook 2019 | Ceres

Sign-on Opportunities

 

New Resources & Reports

Place-Based Impact Investing Practitioner Briefs | Urban Institute and Mission Investors Exchange

  • Seeking ways to maximize the social and economic returns of their place-based impact investments, foundations, CDFIs, private investors, and others are turning to collaboration. The Urban Institute and MIE have produced a set of three practitioner briefs on elements of place-based impact investing that research and conversations with practitioners have identified as opportunities for knowledge exchange.

Shallow Returns? ESG Risks and Opportunities in Aquaculture | FAIRR

  • FAIRR’s new research analyzes the aquaculture, or fish farming, industry and assesses innovations to alleviate the sustainability pressures it faces. Aquaculture is the predominant method of seafood production worldwide – a $230 billion industry with a 6% growth forecast - yet little is understood about the emerging ESG risks associated with this growth which affect climate targets, environmental impacts, biodiversity loss and potential risks to human health.
 

 

Sustainable Investing By Institutional Asset Owners

Ex-CEOs of Major European Pension Funds Back New Climate Endowment | IPE

  • The former chief executives of Harvard University’s endowment fund and two major European pension funds are supporting a planned new €20bn-40bn endowment focused on investing in climate change solutions. Targeting institutional investors such as EU pension funds, it said it would focus on illiquid investments in renewable energy, new mobility, and related clean tech assets.

New York State Common Retirement Fund Climate Action Plan | Office of the  New York State Comptroller

  • The $210 billion New York State Common Retirement Fund (Fund) released a new Climate Action Plan. Subject to fiduciary analysis, the Fund may divest from companies that fail to meet minimum standards. The Fund will double, to $20 billion over the next decade, its commitment to the Sustainable Investment– Climate Solutions Program; hire dedicated staff to identify sustainable investment opportunities; continue engagement with portfolio companies; refine external manager evaluation; and encourage index providers to integrate climate risks and opportunities.
 

Sustainable, Responsible, Impact & ESG Investing

Green Finance Is Now $31 Trillion and Growing | Bloomberg

  • At least $30.7 trillion of funds is held in sustainable or green investments, up 34% from 2016, according to a report by the Global Sustainable Investment Alliance, a group of organizations tracking those moves in five regions from the U.S. to Australia. This piece tells the story of green investing in graphics.

How to Transition Your Investment Portfolio Toward Impact | Stanford Social Innovation Review

  • This piece presents a succinct guide for how to transition an investment portfolio towards impact investing, based on the experience of those who’ve already done so. The lessons came from reviewing 46 transition case studies and webinars; fifty percent produced by foundations, 30 percent by investment managers and advisors, and the rest by pension funds, family offices, and industry organizations, such as TONIIC.

A Systematic Approach to Evaluating Fund Managers’ ESG Policies and Practices | Pictet Wealth Management

  • This piece summarizes the firm’s process for evaluating four key factors: responsible investment policy, investment process, active ownership and reporting. The first step is the qualitative appraisal, done through a due diligence questionnaire and discussions with fund managers, then a quantitative appraisal, to analyze the portfolio’s ESG scores using third-party data and establish conformity with recognised norms. The third step involves a peer group ranking.

ESG Ratings Face Skepticism Even as Loan-Market Importance Grows | Bloomberg

  • ESG ratings now affect the price borrowers pay on about $32 billion of loans worldwide, up from just $3 billion in 2017, according to BloombergNEF. That’s given considerable influence to ESG graders, such as EcoVadis, Iss-oekom and Sustainalytics, which assess borrowers either against specific targets or using broad-based indexes. Still, some investors are unconvinced by ESG ratings, citing vague criteria and conflicting grades across different providers.

ESG Data Overload: Artificial Intelligence to the Rescue | Investment Week

  • As more companies disclose data using different metrics and frameworks, investors are forced to compare and measure vast datasets. AI and machine learning enhances the credibility and authority of ESG integration. The software can help avoid claims of 'greenwashing' and ensure ESG analysis remains credible and reliable.

Why REITs And Their Investors Are Betting Big On ESG | Bisnow

  • Real estate investment trusts are embracing ESG, sometimes because of management champions and sometimes due to pressure from investors. The adoption of ESG best practices by REITs can have a profound impact: the U.S. REIT industry, with its collective portfolio of more than 500,000 properties accounting for $3 trillion in gross real estate assets, accounts for a significant environmental and social footprint.
 

Shareholder Engagement

The 2019 Proxy Season: How Investors are Stepping Up on ESG | GreenBiz

  • While 2018 was a record year for investor support of environmental and social shareholder proposals, 2019 promises to become the year environmental and social issues take center stage. This pieces summarizes trends from the 2019 proxy season.

‘Responsible’ Proxy Voting Is Going Mainstream | Barron’s

  • New voting rules from a popular investment adviser mean that some well-known asset managers—including Pimco—are opposing company management at annual shareholder meetings.

SSGA Provides Guidance for Board Oversight of Climate Risk | Lexology

  • State Street Global Advisors has recently published an updated Climate Change Risk Oversight Framework For Directors. Climate change is identified as a continuing priority for SSGA’s asset stewardship and company engagement program. SSGA advises that boards should look at climate change “as they would any other significant risk to the business and ensure that a company’s assets and its long-term business strategy are resilient to the impacts of climate change.”
 

Green Bonds

IFC, HSBC Green Bond Fund Targets Untapped Opportunity | The Asset

  • The International Finance Corporation (IFC), a member of the World Bank Group, and HSBC Global Asset Management announced the establishment of the first global green bond fund targeting “real economy” issuers in emerging markets, expecting to catalyze around US$500 million to US$700 million in multilateral and private sector capital to support well-diversified climate-smart investments in developing countries around the world.

Acumen and Grameen Impact Launch A Pioneering SDG Impact Bond for Livelihoods | Acumen

  • India’s first Sustainable Development Goals Bond (SDG Bond) for ‘for-profit’ social enterprises was announced by Grameen Impact Investments India and Acumen. LIFE SDG Bond envisions to present a successful workable financial structure to private investors, corporates as well as the government to shift the credit facility assessment for such enterprises from being only a risk-based assessment model to an impact-based assessment model that can be incentivized. 

Sustainable Investing Will Change the World | National Law Review

  • Not only can sustainable, green, social, and other ESG bonds help to support important causes globally, they can be of benefit to corporations. This article looks at the recent Starbucks sustainability bond, Danone Group’s lowering borrowing costs by meeting ESG criteria, and other recent trends.
 

Diversity, Equity, & Inclusion

You Can Now Invest in a Racial Justice Index Fund | Fortune

  • Launched by IEN member OpenInvest, the new racial justice criteria joins more than a dozen other causes promoted by OpenInvest’s indexing technology— which allows investors to prioritize values including gender equality, LGBTQIA+ rights, and ethical supply chains and also combat issues like fossil fuels, deforestation, and greenhouse gas emissions, among others.

Investing Opportunities Are Expanding for the LGBTQ Community | CNBC

  • In a reflection of the progress LGBTQ Americans have made, the range of investment products tailored to their concerns has also been growing in scope and size. The SRI and ESG products offered by many financial firms large and small often do a good job of covering the concerns of many LGBTQ investors.

The Bias of ‘Professionalism’ Standards | Stanford Social Innovation Review

  • Part of the “Breaking Through Barriers to Racial Equity” series: Professionalism has become coded language for white favoritism in workplace practices that more often than not privilege the values of white and Western employees and leave behind people of color. This piece looks at where such implicit biases come from and are expressed, and how workplace cultures and standards of professionalism can be transformed.
 

Gender Lens Investing

ESG Boutique Takes Private Debt Lead on Gender Equality Fund | Citywire

  • Sustainability specialist Calvert Impact Capital will lead the private debt operations of the multi-stakeholder Equality fund, which aims to support improved gender dynamics across the world. The initiative is supported by the Canadian government and seeks to bring together investment strategies and international grant-issuing and  philanthropic groups.
 

Student Managed Funds

West Virginia Students Outperform Financial Markets, Receive Awards for Investing Smarts | WV News

  • West Virginia students are learning first-hand about the value of long term investing thanks to the SIFMA Foundation’s Stock Market Game™, an online academic and life-skills educational program used by hundreds of West Virginia teachers to boost students’ math, economics, and personal finance knowledge, while also improving their test scores and instilling essential skills for financially independent futures.
 

Investment Firm News

ESG As A ‘Conversation’ With Companies | ETF .com

  • S&P Dow Jones Indices added its own twist to socially responsible investing by launching its own house-brand ESG index series. This piece is an interview with Mona Naqvi, senior director of ESG Indices for S&P Dow Jones Indices, to learn more about the benchmarks and how they work.

(Listen) Goldman Sachs’ Hugh Lawson on How Climate Change Is Changing Asset Management | Impact Alpha

  • In the latest episode of ImpactAlpha’s Returns on Investment podcast, David Bank digs in with Hugh Lawson, the head of ESG and impact investing at Goldman Sachs Asset Management, about how greater investor urgency around climate, and growing confidence in low-carbon investment strategies, is changing asset management, or isn’t. The money manager now manages a $21 billion client pool of money invested explicitly with ESG, or impact, objectives.

Nuveen Expands Suite of ESG ETFs with Additional Large-Cap Strategy | Yahoo! Finance

  • Nuveen continues to build out its responsible investing product offering in response to investor appetite. Notably, findings from its latest annual survey revealed a fourth consecutive year of strengthening interest in responsible investing among investors, with 93% of millennials and 78% of non-millennials expressing interest in this approach. Results indicated a nearly 200% increase in the number of RI conversations taking place between advisors and their clients.

Fitch Adds Environmental Risk Metric to Mortgage-backed Securities Ratings | CNBC

  • Fitch Ratings will factor natural disaster and catastrophic risk into their ratings of residential mortgage-backed securities (RMBS), the first of the three major U.S. credit ratings agencies to consider environmental risk explicitly for this asset class.

BlackRock Poaches SRI Thematic Research Chief from French Boutique | Citywire

  • The head of sustainable research at Exane, Carole Crozat, has left the French group to join BlackRock to lead thematic research within its sustainable investing unit. In her new role, Crozat reports to BlackRock's head of research Andrew Bertolotti, who has been working to demonstrate how physical climate risk can affect portfolios.
 

Economic & Policy Shifts

Michael Bloomberg Promises $500 Million to Help End Coal | New York Times

  • Michael R. Bloomberg, the former mayor of New York City, said on Friday he would donate $500 million to a new campaign to close every coal-fired power plant in the United States and halt the growth of natural gas. The new campaign, called Beyond Carbon, will fund lobbying efforts by environmental groups — in state legislatures, City Councils and public utility commissions — that aim to close coal plants and replace them with wind, solar and other renewable power.

Climate Change Takes Center Stage as Biden and Warren Release Plans | New York Times

  • Democratic pollsters say that in surveys and focus groups, climate change often emerges as the second most important issue to the party’s primary voters, following health care — a departure from previous presidential campaign cycles when the environment was sometimes an afterthought. Watch additional coverage of the 2020 Presidential candidates’ positions on climate from the PBS Newshour.

The Vanguard of Corporate Climate Action Has Arrived | GreenBiz

  • Years from now, we’ll look back at May 2019 as a breakthrough moment, when business engagement in climate policy gathered strength and became an unstoppable movement. Alongside pressure to disclose climate risk is increasing investor pressure to disclose political spending. It’s only a matter of time before these two trends converge, and investors, employees and other stakeholders start asking companies to disclose their advocacy on climate policy.

Commentary: 75 Executives Lobbied Congress for a National Carbon Price. We Listened | Fortune

  • Senators Chris Coons (D-DE) and Francis Rooney (R-FL) respond to recent advocacy meetings with over 75 business leaders who collectively employ over 1 million U.S. workers and represent a combined market value of around $2.5 trillion—the largest group of businesses assembled on the Hill to advocate for climate legislation in a decade.

With Infrastructure Reform, U.S. Could Build World’s Biggest, Greenest Carbon Sink | GreenBiz

  • "Green infrastructure" projects don’t just keep greenhouse-gas emissions down; they generate environmental benefits. Some even can become carbon negative, meaning they can absorb more greenhouse gas than they emit. Research published in 2017 showed that green infrastructure can be dramatically cheaper to maintain than gray infrastructure.

US Lags Europe on Regulation of ESG Investing | ESG Clarity

  • In its whitepaper ‘The Evolving Approaches to Regulating ESG Investing’, Morningstar said in the US, where climate change is a “contested concept”, ESG investment factors must be justified by explaining “why,” while in Europe they must explain “why not”. The paper found that, in both regions, regulators need to agree the definition of what should qualify as a sustainable investment, to make it easier to compare products and to avoid investor confusion.

U.K. Seeks to Spearhead Social Investing through Impact Investing Institute | Pensions & Investments

  • The U.K. government wants pension and savings products' investors to benefit societal initiatives, it said by launching the Impact Investing Institute. In efforts to combine financial returns with a social purpose to help improve citizens' lives, the government wants to encourage investments in organizations that provide housing to homeless people, renewable energy companies or businesses committed to delivering sustainable employment.
 

 

Climate Risk, Science, and Clean Energy

New Report Suggests ‘High Likelihood of Human Civilization Coming to an End’ Starting in 2050 | Vice

  • A harrowing scenario analysis of how human civilization might collapse in coming decades due to climate change has been endorsed by a former Australian defense chief and senior royal navy commander. The analysis, published by the Breakthrough National Centre for Climate Restoration, a think-tank in Melbourne, Australia, describes climate change as “a near- to mid-term existential threat to human civilization” and sets out a plausible scenario of where business-as-usual could lead over the next 30 years.

27 Women Leading the Charge to Protect Our Environment | Elle

  • This piece profiles women leading efforts to address the climate crisis and protect the environment, from a variety of fields - science, activism, technology, politics, and social justice.

Companies See $1 Trillion in Climate Risk, but More in Potential Reward | Bloomberg

  • An analysis of thousands of corporate disclosures on climate-change risks suggests that companies stand to gain more than they lose, mostly within the next five years. Some $2.1 trillion worth of potential good news is embedded in those statements, according to IEN member CDP, a U.K. nonprofit that requests information on behalf of a large pool of investors. The financial services industry faces almost $700 billion in risks from regulation, market sentiment or other indirect factors, according to the report, with potential gains of nearly $1.2 trillion.  Read additional coverage in the New York Times.

Putting a Price on the Risk of Climate Change | Bloomberg Business

  • The top 10 energy companies are planning investments approaching $1 trillion by 2030, in everything from finding and tapping new fields to equipment ranging from drones to drilling rigs. If the oil and gas business rolls along as it has for the past century, those projects will likely pay off in fat profits for shareholders. But some analysts and investors warn that the value of much of that infrastructure risks falling to zero if governments make good on tough targets for cutting greenhouse gas emissions.

Climate Risk Is Both Chronic and Acute. Here’s What That Means for Portfolio Managers. | Barron’s

  • The search for yield can take investors to strange places. But never more so when those same investors also have a goal of helping save the planet. Aligning financial interests with reducing the effects of climate change can force upon an investor dichotomies they might never previously have considered.

Mounting Climate Change Fears Push U.S. Investors to Assess Geographical Risks | Reuters

  • The decision to factor in the geographical risks of climate change is becoming increasingly common in ESG investing. The bankruptcy of California utility company Pacific Gas and Electric in January following devastating wildfires is prompting investors to recognize what had been one of the biggest blind spots of environmentally driven investing: the reality that even companies that pledge to combat climate change could be negatively affected by it.
 
 

General Higher Education Endowment News

Harvard Endowment Needs to Lower Fees, Not Pay | Washington Post

  • The cost of investing has declined drastically since 2003, but little has changed at big university endowments, which continue to incur huge investment costs. The so-called endowment model of investing pioneered by Harvard and Yale and widely adopted by other endowments calls for big investment in private assets and hedge funds, many of which still charge a 2% management fee and 20% of profits or more. Endowments could lower costs by negotiating lower fees, but failing that, or a turnaround in the fortunes of private assets and hedge funds, endowments will have to find more affordable locales for their money.
 

 

Fossil Fuel Divestment

Concerning Divestment of the NY State Common Retirement Fund from Fossil Fuels | Testimony to the New York State Senate Standing Committee on Finance

  • Read or watch Crane Institute of Sustainability (IEN’s nonprofit home) board member Bob Litterman’s testimony a few weeks ago, arguing that there will be a more rapid transition to a low-carbon economy than is built into market expectations, and that the appropriate investment policy for the New York Common Retirement Fund should be to take advantage of the economic opportunities available from tilting its portfolio toward investments that are expected to perform well if this scenario occurs.

‘We’re Not Going Away’: Prominent Harvard Alumni Intensify Divestment Push | FundFire

  • (Subscription required) Several powerful Harvard University alumni are stepping up efforts to pressure their alma mater into divesting from fossil fuels - and they say they’re not going away anytime soon. The “ad hoc committee on Harvard Divestment” convened by retired Senator Timothy Wirth is coordinating alumni activists around the issue of divestment.

Wadham Commits to Full Divestment from Coal and Tar Sands | Cherwell

  • Wadham College’s governing body has approved a statement resolving to fully divest the College’s endowment from coal and tar sands, tobacco and ‘controversial’ arms manufacturing. The College’s estimated £107 million endowment will now be prevented from investing in companies that gain a significant portion of revenue from these industries. Campaigners expressed hope that other colleges now will follow suit, and that similar guidelines will be adopted by Oxford University Endowment Management (OUem), a wholly owned subsidiary of the University of Oxford.

City Council Votes to Divest from Fossil Fuels and Weapons | CBS19

  • Charlottesville City Council voted four to one to divest from companies engaged in the production of fossil fuels or upgrading weapons or weapon systems. Charlottesville City treasurer, Jason Vandever, promised that the divestment will have minimal effect on the city’s financial stability.

Peduto Asks Pension Board To Divest From Fossil Fuels, Firearms And For-Profit Prisons | WESA Radio

  • Members of the city of Pittsburgh's Comprehensive Municipal Pension Trust Fund board will explore divesting from fossil fuels, firearms and ammunitions and for-profit prisons. This is at the direction of Mayor Bill Peduto, who sits on the board. City spokesman Tim McNulty said it's unclear how divestment would impact the fund's bottom line, so the Mayor is asking the board to create an exploratory committee to find out.

Editorial: Patrick Deane Should Champion Fossil Fuel Divestment as Queen’s Principal | Queen’s Journal

  • This editorial argues that the incoming principal of Queen’s University (Ontario), should pledge his support to the students, faculty, and staff who want to see the University rid itself of more than $230 million of fossil fuel investments.
 

Calendar of Upcoming Events

IEN Events:

Community Impact Investing Roundtable 2019 | Intentional Endowments Network, September 6, 2019, Berkeley, CA

2020 Higher Education Climate Leadership Summit | Intentional Endowments Network and Second Nature, February 23-25, 2020, Atlanta, GA

Other Events:

Racial Equity Learning Series: Changing Power Dynamics in Philanthropy | Funders’ Committee for Civic Participation, June 10, 2019 3-4pm EDT, webinar.

9th Annual Conference: New Challenges New Opportunities | US SIF, June 10-12, 2019, Minneapolis, MN 

How Technology is Impacting Shareholder Engagement | Broadridge, June 11, 2019, 1-3pm EDT (webinar)

Spectrum: Access, Inclusion, Impact | SOCAP and Conscious Company Media, June 12-13, 2019, Atlanta, GA

OCIO Solutions Summit | Investment Management Institute, June 12, 2019, Stamford, CT, Interested members should contact Kaede Kawauchi to access the following member discounts:

  • IEN endowment members - Room and board will be covered, $350 registration fee (80% off the original price), Opportunity to speak on a panel
  • IEN asset manager members - $200 off the original price

Sustainability, Diversity, Equity and Inclusion Workshop 2019 | AASHE and North Hennepin Community College, June 12-14, 2019, Minneapolis, MN

2019 Northeast Campus Sustainability Consortium Conference: Trends in Northeast Sustainability Challenges | University of Southern Maine, June 17-18, 2019, Portland, ME

From Principles to Practice: the “How-To” Guide on TCFD Implementation | SASB and CDSB, June 20, 2019, 11am EST, webinar.

2nd Annual Advisors Forum | Confluence Philanthropy, June 24-25, 2019, San Francisco, CA, Member pricing available for IEN members.

CDP Matchmaker Workshop: Accelerating Green Infrastructure Investments in Cities | CDP, June 25, 2019, Parma, OH

Emerging Lessons on Place-Based Impact Investing Collaboration | Mission Investors Exchange and the Urban Institute, June 27, 2019 3:00PM EDT, webinar.

Sustainable Investing Solutions | Appleseed Capital, Brown Advisory, Calvert Research, Community Capital Mgmt, Saturna Capital, First Affirmative/Folio Institutional, Parnassus Investments, Impax Asset Mgmt, Trillium Asset Mgmt, Green Century , Allianz, Calvert Impact, and US SIF, July 9, 2019, Boston, MA This is a Financial Advisor Only Event.

Financing the Future: The Global Climate Divest-Invest Summit | Divest Invest, Fossil Free SA, Global Catholic Climate Movement, GreenFaith, PACJA, Shine, Wallace Global Fund, and 350, September 10-11, 2019, Cape Town, South Africa.

Impact Investing: Driving Social Purpose Through Measurable Investment Returns | Skytop Strategies, September 17, 2019, Boston, MA, Interested members should contact nicole@intentionalendowments.org to access a 15% off registration IEN Member discount code.

GIIN Investor Forum | GIIN, October 2-3, 2019, Amsterdam, Netherlands

2019 AASHE Conference & Expo: Co-Creating a Sustainable Economy | AASHE, October 27-30, 2019, Spokane, WA

21st Annual Endowment and Foundation Forum | Opal, November 7-8, 2019, Boston, MA

2nd Impact Summit America | Phenix Capital, November 14, 2019, New York, NY

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