The theme of this month’s IEN newsletter is passive strategies for investing in environmental, social and governance (ESG) criteria.  

Our feature article is a Q&A with Thomas Kuh, Executive Director, MSCI and Paul Schutzman, Executive Director, MSCI, and offers an overview of the significant ESG trends and developments that we should be aware of in 2017, as well as what first steps institutions that are grappling with how to approach ESG can take. The School Spotlight highlights the University System of Maryland Foundation and their seed investment in the iShares MSCI ACWI Low Carbon Target ETF, a fund that addresses two dimensions of carbon exposure – carbon emissions and fossil fuel reserves.

We are very excited to be holding a Roundtable for endowment decision-makers and stakeholders focused on low-carbon strategies and climate solutions next week, and have included more information below. Also, be sure to save the date for the 2018 Higher Education Climate Leadership Summit: February 4-6, 2018 in Phoenix, Arizona.

As always, your contributions to the conversation are welcome and needed. Please be in touch with any questions, news or ideas for the IEN.

Warm regards,

Georges, Tony, Nicole & The IEN Team

 

Feature Article: ESG Investing Trends: Common Approaches and Benchmarking

Q&A with Thomas Kuh, Executive Director, MSCI and Paul Schutzman, Executive Director, MSCI 

In this Q&A, Thomas Kuh and Paul Schutzman, Executive Directors at MSCI, discuss the significant ESG trends and developments that we should be aware of in 2017,  some of the ESG concerns, demands and questions they hear most frequently from asset owners in the US, and what first steps institutions that are grappling with how to approach ESG can take. Read their full insights on the IEN Blog.

 

School Spotlight: University System of Maryland Foundation

University System of Maryland (USM) students have been driving change at The USM Foundation for several years. In 2013, students circulated a petition to divest from fossil fuels with nearly 600 signatures from students at Towson University, the University of Maryland, Baltimore County and other colleges. In response, in 2014, along with the United Nations, the USM Foundation was a seed investor in the iShares MSCI ACWI Low Carbon Target ETF.The ETF tracks the results of the MSCI ACWI Low Carbon Target Index and addresses two dimensions of carbon exposure – carbon emissions and fossil fuel reserves. The fund was designed for individuals and institutions interested in environmental sustainability without divestment and provides transparency to the carbon footprint of their investments. On January 29th, 2015 a member of the USM Foundation investment team rang the NYSE's closing bell to officially usher in the new fund’s ticker onto the exchange.

“Being able to address socially responsible concerns while maintaining our fiduciary standards is critical to our investment approach,” said Sam Gallo, Chief Investment Officer of the University System of Maryland Foundation. “The iShares MSCI ACWI Low Carbon Target ETF is a low-cost investment solution that allows us to maintain full exposure to global equities while incorporating a carbon exposure reduction strategy.”

Read more about sustainable investing at the University System of Maryland Foundation in this article on IEN's Blog. 

Featured Event: 2017 Bay Area Intentionally Designed Endowment Roundtable  

Building on the success of previous events, the Intentional Endowments Network, in partnership with the Center for Responsible Business at Berkeley-Haas and BlackRock, is pleased to host an Intentionally Designed Endowment Roundtable for endowment decision-makers and stakeholders from institutions interested in enhancing their leadership on sustainable investing. The event will focus on low-carbon strategies and climate solutions.

Tickets are still available for endowment & foundation (asset owner) representatives-- we invite you to register here. (Please note that we are sold out of tickets for investment firms and companies.) To read more about the event click here, and follow this link to see the agenda.

 

Updates from the Network 

New Contributing Members

We are pleased to welcome the following organizations to the Network as contributing members: University of Winnipeg, The Sant Charitable Foundation, Breckinridge Capital Advisors, 3Sisters Sustainable Management, Seamans Capital Management, Eastern Washington University, University of Southern Maine, Metro Partners, Natixis Asset Management, Community Investment Management, Total Impact Capital, Greenbacker Capital, Martin Investment Management, LLC, Amalgamated Bank, and Northland College. To see a full list of contributing members, click here. To learn more about the leadership opportunities and benefits of IEN membership, click here.

Webinars

In the past few months, IEN has hosted the following webinars. Follow the links below for more information and to view recordings of each:

• Introduction to Impact Investing  l June 2017

• First-Time Fund Managers in Emerging Markets Bring a New Model to Private Equity in Africa  l July 2017

• Investing Intentionally at the Systems Level l August 2017

Working Groups

IEN Working Groups meet regularly to advance key strategies in support of the network's goals. Below is a brief update of what current Working Groups have accomplished.

• Fiduciary Duty & Policy:  This group is now focusing on a briefing paper for trustees summarizing the latest thinking on fiduciary duty and sustainable / ESG investing to be published in early fall. Group members are also contributing to the development of a Roadmap that lays out the key steps investors can take to create intentionally designed endowments, and the Group if also identifying opportunities for educating others on fiduciary duty topics at conferences and within other networks.

• Clean Energy: This working group is currently developing a resource on how to most effectively enable endowments to make impact investments in solar PV projects. This framework will build off of the Clean Energy White Paper that was released last fall, and will provide guidance to fund managers on how endowments can approach this market.

• Student Managed Funds: This working group connects student managed fund advisors, academics focused on sustainable investing, and students involved in student managed funds to share best practices and resources to advance sustainable investing curriculum and strategies in each fund. The Group is currently developing a toolkit on How to Start a Student-Managed Fund, and working to pull information together on different student-managed funds across the country, including information on where they are in the process of establishment and how they are managed. If your school has a student-managed fund, we would greatly appreciate your assistance in entering the fund’s information in the database. Please reach out to Nicole at [email protected] to access the database.

• Trustee Peer Group: The Trustee Peer Group is currently focused on bringing new members into the group to create more opportunities for peer-to-peer learning among college and university fiduciaries on sustainable investing. In the next few months the group will be focusing on reaching out to more trustees to participate in the 2018 Higher Education Climate Leadership Summit. If you are interested in participating in this group, please reach out to Tony at [email protected]. 

IEN Annual Member Survey 

Earlier this week, we sent out a survey for our Network Members to assess how effectively we are meeting the goals of the Network in accelerating and enhancing endowment leadership. This annual membership survey will inform strategic priorities and identify areas for improvement, and we are eager to gather feedback to identify ways we can improve our membership program, events, resources, and engagement. To our members, if you haven't yet filled out the survey, please do so! And to learn more about the leadership opportunities and benefits of IEN membership, click here.

Upcoming Events

• 2017 Bay Area Intentionally Designed Endowment Roundtable | Intentional Endowments Network and the Center for Responsible Business at Berkeley-Haas, September 8, 2017, Berkeley, CA 

• Five Fund Forum | Big Path Capital, September 26-28, 2017, Park City, UT (on 9/26); San Francisco, CA (on 9/27); and New York, NY (on 9/28) 

• AASHE Conference and Expo: Stronger in Solidarity l AASHE, October 15-18, 2017, San Antonio, TX
  • IEN will be hosting a session on investing in line with the goals of the Paris Agreement and the Sustainable Development Goals and participating in a session on investing in clean energy.

• The SRI Conference l November 1-3, 2017, San Diego, CA

• Investing for Impact Symposium l High Water Women, November 30, 2017, New York, NY

• 2018 Higher Education Climate Leadership Summit l Second Nature & The Intentional Endowments Network, February 4-6, 2018, Phoenix, AZ

To view more upcoming events, click here. 

Featured Resources

Below are some recent resources from the Intentional Endowments Network and other organizations. To see more reports, articles, videos and other resources by topic, visit the resource page on our website.

Resources from IEN:

• Considerations for ESG Policy Development l The Intentional Endowments Network & Cambridge Associates

• The Paris Agreement in the Investment Policy: Sample Language for Integrating the Goals of the Paris Climate Agreement into an IPS l The Intentional Endowments Network & Cambridge Associates

Other Resources:

• Factory Farming in Asia: Assessing Investment Risks l Farm Animal Investment Risk & Return (FAIRR) Initiative
• The ESG Integration Paradox l Harvard Law School Forum on Corporate Governance and Financial Regulation
• ESG and Sustainable Hedge Fund Investing: Observations l Alternative Investment Group
• University of Winnipeg Responsible Investment Policy
• ESG Integration: Evaluating and Monitoring External Asset Manager Performance | Wespath Investment Management 
• Equity Strategy Focus Point ESG Part II: A Deeper Dive l Bank of America
• The Transformation of Growth: How Sustainable Capitalism Can Drive a New Economic Order l Generation Foundation
• PRI’s Private Equity Terms Guidance Focuses on ESG Factors l JD SURPA

In the News

Below is a sampling of recent news articles we've posted on our Newsfeed, ranging in topics from Sustainable Investing, Climate Risk, Science & Regulation, Sustainability in Higher Education, Divestment, Clean Energy, and more.

IEN in the News:

• U.S. Impact Investing Alliance Launches to Scale the Practice of Impact Investing l U.S. Impact Investing Alliance

• Podcast: "Unlocking Endowments for Impact" | Coalesce, Campus Sustainability Accelerator  

Other News:

• Cool Schools 2017 Full Ranking l Sierra Club
• Exxon Duped Public Over Climate Concerns, Harvard Research Says l Bloomberg
• Walden Withdraws Vanguard Proxy Voting Shareholder Resolution l CorporateGovernance.net
• Photons for the Future: Solar Panels Providing a Bright Future for Eastern Kentucky University Students l The Richmond Register
• Climate Report Could Force Trump to Choose Between Science and His Base l The New York Times
• Divested from Fossil Fuels Since 2011, Hampshire College Reports Endowment Investment Returns | Huffington Post
• Loyola Marymount University Signs on to United Nations-Supported Principles for Responsible Investment l LMU News
• 10 Studies That Show How and Why ESG Investing Works l Reuters
• An Insider Explains Why Wall Street's Big Money Focus On Sustainability Is Here To Stay l Forbes
• Historically Black Colleges Try to Catch Up as Rich Schools Get Richer l Bloomberg
• The Value of the Shareholder Proposal Process l Harvard Law School Forum on Corporate Governance and Financial Regulation
• Massive Iceberg Breaks Off from Antarctica l NASA
• ESG Investment Strategies Will Disappear (And For Good Reasons) l Financial Advisor
• Should You Invest In 'Green Bonds?' l Forbes
• Institutional Investors Welcome TCFD Climate Task Force Recommendations  (Subscription) l Responsible Investor
• University of Winnipeg Foundation Announces Policy to Guide Endowments l Winnipeg Free Press
• High ESG Performance Translates Into High Financial Performance l Forbes
• Why Can’t Your Company Just Fix the Gender Wage Gap? l Bloomberg Business Week
• Shareholders Force ExxonMobil to Plan for a World with Paris Agreement's Emissions Restrictions l World Resources Institute
• Phoenix and Arizona State University Launch a Hub for the Circular Economy l Green Biz
• Socially Responsible Investing: Divesting from Fossil Fuels l The Bill Fold

If you have an original piece you would like to submit for an upcoming newsletter, or for more information about the Intentional Endowments Network and how you can support this work, please contact Georges Dyer at [email protected].