Weekly News Round-Up: August 23, 2019

This week the Amazon rainforest is burning and we observed Equal Pay Day for black women in the U.S. We’re all feeling the urgency - including leading CEOs, who revised the Business Roundtable statement of principles this week to recognize their role in creating “an economy that allows each person to succeed through hard work and creativity and to lead a life of meaning and dignity.”

Join two upcoming peer conversations about how investors can act on climate and inequality: our webinar September 4th on the new Operating Principles for Impact Investing and our ESG & Community Impact Investing Roundtable on September 6th!

Opportunities for Action
  • Deadline: September 4, 2019. To mark the 30th convening of The SRI Conference, organizers announced a new annual award designed to spotlight and nurture the emerging generation of leaders who will guide the SRI/ESG/impact investing industry well into the second half of the 21st Century.

Global Investor Statement to Governments on Climate Change | Investor Agenda

  • Deadline: September 6, 2019. Asset owners and asset managers in IEN are encouraged to sign the Global Investor Statement to Governments on Climate Change. To add your organization’s name to the statement, please complete this short form. There is no cost to sign the statement and no further actions are required of signatories. In addition to signing the global investor statement, we strongly encourage you to take action in the other areas of The Investor Agenda: Investment, Corporate Engagement, and Investor Disclosure. If you have any questions or need additional information, please email Chris Fox at fox@ceres.org.

2020 Higher Education Climate Leadership Summit Call for Proposals | Intentional Endowments Network and Second Nature

  • Deadline: September 30, 2019. Colleagues from all disciplines, backgrounds, and perspectives are encouraged to submit proposals for next-level conversations, workshops, and concurrent sessions for the 2020 Higher Education Climate Leadership Summit. If you have more general ideas for shaping the Summit, please submit them here.

Consortium Advisory Board Members Wanted | The Medical Society Consortium on Climate and Health

  • The Medical Society Consortium on Climate and Health (Consortium) unites physicians and other health professionals to speak out about the current health harms and future risks of climate change, and the significant health benefits of climate change solutions. Headquartered at George Mason University’s Center for Climate Change Communication, the consortium has 23 member societies with 600,000 physician members, and 33 affiliates with millions of members. More information and application form available here.

Sign-on Opportunities:

 

New Resources & Reports

Renewables on the Rise: A Decade of Progress Toward a Clean Energy Future | Environment America

  • Since 2009, the United States has increased its solar power generation 40-fold and upped its electric production from wind by more than 270 percent, according to a new report by Environment America Research & Policy Center and Frontier Group. The study provides a state-by-state assessment of the growth of key technologies needed to power the nation and highlights advances in energy savings, the increased use of energy storage and the tremendous growth of electric vehicle sales.
 

Sustainable Investing By Institutional Asset Owners

Sustainable Investing Overview for Managers | Harvard Management Company

  • Harvard Management Company, the entity responsible for investing Harvard’s $39 billion endowment, posted its view on sustainable investing for managers, covering ESG integration, diversity and inclusion, stewardship, climate change, and ethical considerations and investment exclusions. 

(Listen) Should a Pension Fund Try to Change the World? | Harvard Business Review

  • In this podcast, Harvard Business School professors Rebecca Henderson and George Serafeim discuss the efforts of Hiro Mizuno, CIO of GPIF, the Japanese Government Pension Investment Fund, one of the largest pools of capital in the world, to integrate ESG issues into every aspect of GPIF’s portfolio.
 

Sustainable, Responsible, Impact & ESG Investing

Public Funds Taking the lead in Spectacular Boom of ESG | Pensions & Investments

  • This in-depth article breaks down the drivers of the surge in ESG investing as documented by the 2018 US SIF Trends report.  

Companies That Embrace Sustainable Investing See Their Sales — and Stocks — Rise | Barron’s

  • As the market decline prods investors to take a cold, hard look at returns, critics of sustainable investing have been quick to call its demise: Investing sustainably, detractors say, invariably means sacrificing returns. But New York University professor Tensie Whelan, director of its Center for Sustainable Business, is making a career out of proving otherwise. Whelan joined NYU’s Stern School of Business in 2015—after 15 years leading the nonprofit Rainforest Alliance—and has toiled to put hard numbers to claims that when companies embrace sustainable practices, it actually leads to higher profits.

Why Are Revenue-based VCs Investing in So Many Women and Underrepresented Founders? | Tech Crunch

  • This post explores how the structure of revenue-based investing may eliminate some of the structural bias against women and underrepresented founders built into traditional venture capital models.

UNEP-FI, GCA Cite Adaptation as “Biggest Investment Opportunity of This Generation” | SDG Knowledge Hub

  • A new UN report contends that identifying the financial implications of climate risks will lead to opportunities for profitable investment on the one hand, and to potential capital flight from the most vulnerable communities and countries, on the other, and makes recommendations for addressing barriers and opportunities. 

Charting a New Course for Impact Investing: The Emerging New Paradigm of Living Systems for Capital Markets | Ethical Markets

  • Despite efforts to bring the two closer, impact investing and traditional finance suffer from a misalignment challenge. Since the goals of traditional finance are inherently separate from the qualitative dimensions of values-based investing, creating mechanisms to bridge the gap has been ineffective up to this point. A new framework is needed – and is currently being constructed. All investors must coalesce around principles that have been with us for millennia; the same principles that dictate a natural order have the power to build long-term profitable companies, positive economic returns for investors, resilient communities, and sustainable ecosystems.

How to Know if You’re Invested in Gun Stocks | Yahoo Finance

  • Investors can quickly and easily check a website like Weapon Free Funds to check the risk that their fund is exposed to firearm stocks. Read further coverage about weapon-free funds here.

Does Sustainable Investing Constrain A Portfolio? | Seeking Alpha

  • Many investors think a sustainable agenda limits a portfolio to a narrow piece of the market. In fact, plenty of stocks can help investors create social benefits while generating strong returns - if you know how to find them. When evaluating a sustainable equity portfolio, check whether the manager is actively drawing on a broad universe of SDG-aligned companies and not just the usual ESG suspects. And make sure that portfolio construction takes into account the potential factor and sector tilts, and how they might influence the pattern of returns.

Asset Managers Warned Over Poor Data Governance in ESG Rush | IPE

  • Asset managers must be careful not to apply lower standards of governance to environmental, social and corporate governance (ESG) data than to other inputs into the investment process, according to a report. Many firms were effectively doing just that, however, and exposing themselves to a range of risks in the process.
 

Shareholder Engagement

SEC Highlights Proxy Voting Rules, Guidance Amid ESG Debate | IPE

  • In a split vote the US regulator has approved guidance about asset managers’ responsibilities when using proxy advisory firms and the rules applicable to them. These included an “interpretation” noting the SEC’s view that providing voting advice was “solicitation” under federal law and subject to anti-fraud rules. The backdrop to the SEC’s intervention is a heated debate about the role of proxy advisory firms, which institutional investors use to help them vote shares – a typical service is the provision of voting recommendations.

FTSE 100 CEO Pay Drops Due to New Reporting Regime, Reveals Deloitte | IR Magazine

  • CEO pay at FTSE 100 companies has dropped to its lowest level since 2014, according to Deloitte’s annual FTSE 100 executive remuneration report. The analysis of filings from the latest season of AGMs reveals median CEO pay stands at $4.1m, the lowest level since 2014, when a reporting requirement to provide a single figure for total pay was introduced. A number of pay revolts have been seen by investors in the recent AGM round, but the number of FTSE 100 companies receiving ‘low votes’ on pay – measured as below 80 percent in favor – fell by almost half to 7 percent of companies compared with 13 percent last year.
 

Socially Responsible Retirement Funds

Participants’ Posture on ESG Investing Not Showing in Retirement Plans | PlanSponsor

  • The sentiment for ESG investing is positive among all generations though their actions in retirement plans don’t show it. How should plan sponsors fit ESG into the investment puzzle?
 

Community Impact Investing

Pasadena’s Kaiser Permanente Backs $4.3 Million Investment to Create Affordable Housing | Pasadena Now

  • New Los Angeles and San Diego affordable housing developments are the first impact investments in Southern California from the recently created $100 million RxHome Fund. This fund is comprised of a $50 million loan from Kaiser Permanente to Enterprise Community Loan Fund, plus an additional $50 million in capital from ECLF. The goal of the RxHome Fund is to create and to preserve 3,250 healthy and affordable homes over the next decade in Kaiser Permanente’s service areas nationwide.

Opportunity Zones Are Heating up as the Year Progresses | Forbes

  • This article summarizes the continued evolution of Opportunity Zones and Qualified Opportunity Funds as a channel for increasing investment in low income communities.
 

Green Bonds

Green, Social and Sustainable Bonds: Long-term Profitability | BBVA

  • Angel Tejada, BBVA’s head of green and sustainable bonds, analyzes the activity in the green, social, and sustainable bond market during the first half of the year and explains the outlook and opportunities that this exponentially growing market represents.

Environmental Impact Bonds: The Very Welcome New Kid on the Municipal Finance Block | Water Finance & Management

  • This post profiles the 2016 tax-exempt municipal Environmental Impact Bond issued by DC Water and Quantified Ventures for green infrastructure projects in Washington DC. 

Green Bond Supply Growing in Asia Pacific | Business World

  • More companies have been pursuing green and sustainable projects over the last five years, with funds raised in the global green bond market rising to more than $167.3 billion as of end-2018. The Asia-Pacific region accounted for 22% of the global green bond market, mostly due to mature markets such as China, Korea, Japan, and Hong Kong.
 

Diversity, Equity, & Inclusion

(Webinar) It’s About Time: A Call to Advance Racial Equity in the Investment Industry | Confluence Philanthropy

  • Webinar: September 10, 2019 9:30-10:30am PT / 12:30-1:30 ET. With its new report on this theme as a backdrop, join Confluence for a webinar discussion featuring Cynthia Muller, Director of Mission Investment at the W.K. Kellogg Foundation and Bob Bancroft, Vice President of Finance at the Nathan Cummings Foundation. The conversation will be moderated by Geeta Aiyer, President and Founder of Boston Common Asset Management. The panelists will engage in a candid conversation about their foundation’s journey to integrate racial equity into their investment practice.

It's Racial Bias, not Merely an Issue of Access | Pensions & Investments

  • This article provides further analysis on the recently released study by Stanford University and Illumen Capital, which found that black fund managers must overcome racial bias to win institutional money and are judged more harshly as top performers.

New Diversity Data Coming for Responsible Investors | Investment Executive

  • On Jan. 1, 2020, publicly traded companies governed by the Canada Business Corporations Act will be required to disclose their policies and practices related to diversity on their boards of directors and within senior management, including the proportions of women, Aboriginal peoples, people with disabilities and members of visible minorities. Canada will be the first jurisdiction in the world to mandate disclosure of specific diversity characteristics in addition to gender.

Emerging and Diverse Manager Programs: Worth Doing Well | Commonfund

  • This post clarifies the difference between “emerging” and “diverse” managers, and the best practices for increasing investment in each.
 

Investment Firm News

Discover Material Insights with S&P DJI ESG Data | IPE

  • A quarter of all professionally managed assets now incorporate ESG considerations, from the impact of climate change to equality and human rights. This white paper reviews the rich history of S&P Dow Jones Indices in this area began in 1999 by pioneering ESG indexing with the launch of the Dow Jones Sustainability Index, which marks its 20th anniversary in 2019.

Wells Fargo Provided $23 Billion in Sustainable Financing in 2018, Company Says | Environmental Leader

  • Wells Fargo & Company announced that it has provided $23 billion in financing in the first year of its $200 billion sustainable finance commitment; the company says 63% of the 2018 funding went toward low-carbon solutions such as green buildings, renewable energy and clean technologies, while the rest supports business and projects focused on sustainable agriculture, conservation, recycling, resource management and other environmentally beneficial activities.

Socially Responsible UBS Fund “First in Europe” to Exceed €1bn AuM | Funds Europe

  • Zurich-headquartered UBS Asset Management saw assets under management in its socially responsible exchange-traded fund surpass the €1 billion mark in July, in what the firm called a first for Europe.
 

Economic & Policy Shifts

America’s CEOs Seek a New Purpose for the Corporation | Fortune

  • For more than two decades, the influential Business Roundtable has explicitly put shareholders first. In an atmosphere of widening economic inequality and deepening distrust of business, the powerful group has redefined its mission. Read more coverage from the Washington Post, New York Times, Wall Street Journal, and Economist, and read the full statement here.

Decrement Carbon: Stripe's Negative Emissions Commitment | Stripe

  • As part of Stripe’s environmental program, we fully offset our greenhouse gas emissions by purchasing verified carbon offsets. Starting this year, we’re going a step further. In addition to our offset program, we are committing to pay, at any available price, for the direct removal of carbon dioxide from the atmosphere and its sequestration in secure, long-term storage. We’re announcing this commitment to solicit technology partners and to urge other companies to follow suit.

New Coalition Looks to Align Business Goals with Impact Investing | Pensions & Investments

  • A coalition of global leaders and businesses is launching a new initiative aimed at aligning business interests that can also deliver social impact. The 34 leading international companies joining the Business for Inclusive Growth initiative will work with the Organization for Economic Cooperation and Development, whose chairman — French President Emmanuel Macron — is expected to promote the initiative at the upcoming G-7 meeting in Biarritz, France. The companies have committed to act more assertively to address social inequalities in society and their workplaces.

Human Rights and Green Finance: Friends or Foes? | Euractiv

  • This opinion piece argues that the current European effort to define sustainable finance goals risks unwittingly promoting harm to people as it seeks to power environmental progress, and proposes ways to safeguard human rights.
 

Climate Risk, Science, and Clean Energy

Climate change, oxygen and biodiversity: Amazon rainforest fires leave plenty at stake | NBC News

  • Record fires sweeping across the Amazon this month are bringing renewed scrutiny to Brazil's deforestation policy and have environmental researchers and conservationists worried that the blazes will only aggravate the climate change crisis.

Fracking May Be a Bigger Climate Problem than We Thought | Vox

  • As greenhouse gases go, methane gets less attention than carbon dioxide, but it is a key contributor to climate change. Methane doesn’t stay in the atmosphere as long as CO2 and is reabsorbed into terrestrial cycles via chemical reactions within 12 years or so. But while it’s up there, it’s much more potent, trapping heat at roughly 84 times the rate of CO2. Scientists estimate that around 25 percent of current global warming traces to methane. It turns out that a mysterious recent spike in global methane levels that’s putting climate targets at risk may be coming from US oil and gas fracking.

Ceres Risk Analysis of Power Sector Calls for Decarbonization by 2050 | Pensions & Investments

  • Updated guidance for U.S. power companies and investors assessing the risks and opportunities related to climate change was released by Ceres, a sustainability non-profit organization. The climate scenario analysis framework, an update to a 2018 report, also underscores the need for the U.S. power sector to completely decarbonize before 2050 to limit global warming to less than 1.5 degrees Celsius, as recommended by the Intergovernmental Panel on Climate Change.

Addressing Climate Change from a Finance and Liability Lens | Devex

  • This summary of an address by Minter Ellison special counsel climate risk governance Sarah Barker focuses on the market opportunities for businesses that apply a sustainability lens, as well as the risks climate change poses to traditional investment strategies. 

(Opinion) Youth to Adults — Join Us in the Climate Fight | Boston Globe

  • In this opinion piece, Bill McKibben thanks youth activists for elevating the climate crisis and calls on others to join them in an upcoming Global Climate Strike day of action in September.

Windmills and Batteries to Attract Billions in the Green Energy Revolution | Bloomberg

  • The renewable energy transition promises to reduce carbon emissions, but it’s happening at different speeds around the world. BloombergNEF’s New Energy Outlook 2019 provides a detailed road map to the future. 

So What if Tax Breaks Are Cut for Wind and Solar Power? | Chief Investment Officer

  • Washington is trimming federal tax breaks for solar and wind energy, whose growth these incentives spurred. At first blush, that appears to be bad news for these renewable power sources. But in spite of the loss of federal help, which may retard them a bit, their future appears to be solid.
 
 

General Higher Education Endowment News

Almanac 2019-2020 | Chronicle of Higher Education

Investment Beliefs: The Governance Bedrock for Investment Committees | Pensions & Investments

  • Endowments and foundations are typically governed by members of a volunteer investment committee who are charged with fiduciary oversight of a perpetual portfolio that is closely tied to the organization’s mission. Yet it’s difficult to maintain the discipline of managing a long-term portfolio as markets ebb and flow, investment fashions change, and investment committees turn over. Crafted wisely, a set of agreed-upon investment beliefs can serve as a tool to enable investment decisions that help endowments and foundations sustain their spending needs now and in the future.

Reed Hires Erik Bernhardt as Its First Chief Investment Officer | Reed Magazine

  • Reed College has hired Erik Bernhardt as its first Chief Investment Officer effective August 1, 2019. Bernhardt brings more than 20 years of investment experience to the college. Bernhardt’s extensive investment career includes providing investment advisory services to endowments and foundations at Cambridge Associates, 10 years at Pacific Alternative Asset Management Company, and work as a director at Artisan Partners. Reed’s endowment is currently valued at $580 million and provides more than 25 percent of the college’s annual operating budget. Over the past 10 years, endowment earnings have contributed over $220 million to the operations of the college.
 

Fossil Fuel Divestment

First Aid for the Climate Emergency is Better Delivered as a Team | The BMJ

  • This opinion piece celebrates the decision by the Royal College of Emergency Medicine to divest from fossil fuels based on pressure from medical professionals.

Wales Must Divest from Fossil Fuels | The Ecologist

  • A coalition of organisations that collectively represent tens of thousands of people have come together in an open letter to urge Local Authority Pension Funds, the new Wales Pension Partnership, the Assembly Member Pension Scheme and the Welsh Government pension fund to commit to truly ethical investment policies.
 

Partnership Opportunities
 
Calendar of Upcoming Events

IEN Events:

IEN Webinar: Beyond ESG, Towards Impact & the SDGs | Intentional Endowments Network, September 4, 2019, 1-2pm EDT (webinar)

ESG & 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. Provide input to shape the agenda here, or propose a session topic here!

Other Events:

Seeing SRI in Context: Emerging Strategies for Socially Responsible Investing in College Endowments | NACUBO, September 4, 2019 1:00-2:15pm ET (webinar with registration fee)

2019 Family Office Impact Summit | United Nations, September 5, 2019, New York, NY. Family office members of IEN are eligible for discounted registration.

Getting Gender Smart: Impact Investing with a Gender Lens | Duke Fuqua School of Business, September 9-11, 2019, Durham, North Carolina

It’s About Time: A Call to Advance Racial Equity in the Investment Industry | Confluence Philanthropy, September 10, 2019 9:30-10:30am PT / 12:30-1:30 ET (webinar - open to members of Confluence Philanthropy, as well as non-member grant-makers and values investors)

Total Impact Family Office and Foundation Conference | ACG New York, Alberleen Family Office Solutions, and Good Capital Project, September 10, 2019, New York, NY. This event is intended for asset owners, including higher education endowments and foundations; agenda themes include Climate change mitigation and resource efficiency; Healthcare; Housing and infrastructure; Sustainable agriculture; and Investing in women. For an invitation to the event, please reach out to IEN.

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.

Sustainable Investment Forum North America 2019 | UN Environment Programme Finance Initiative, September 25, 2019, New York, NY (Climate Week)

Regenerative Food Systems Investment Forum | RFSI Forum, September 30-October 1, 2019, Oakland, CA

GIIN Investor Forum | GIIN, October 2-3, 2019, Amsterdam, Netherlands. Interested members should contact hannah@intentionalendowments.org to access a 15% off registration IEN Member discount code.

Color of Education Summit | Public School Forum of NC, The Samuel DuBois Cook Center on Social Equity, and Policy Bridge at Duke University’s Sanford School of Public Policy, October 26, 2019, Raleigh, NC

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. Asset owner IEN members are eligible for complementary registration.

GreenBiz 20 | GreenBiz, February 4-6, 2020, Phoenix, AZ

Croatan Forum 2020 | Croatan Institute, April 27-29, 2020, Durham, NC

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