This webinar is part of IEN's Investing in Racial Equity Series

Date: December 15, 2020, 1:00 p.m. ET

It is abundantly clear how investments in private prisons, or lack of investments for entrepreneurs of color, affect racial justice outcomes. But what about all the other investments in a portfolio? In this session led by Andrea Armeni, Co-Founder and Executive Director of Transform Finance, we will focus on some of the more difficult-to-see ways in which endowments are inextricably linked to outcomes that negatively affect communities of color. Transform Finance, along with other experts in the field, will lead us into conversation to argue that capital has a long way to go in being a true ally – or even just not being a source of harm – for communities of color, and this starts with identifying where race shows up in a portfolio in less obvious ways. Panelists will provide a look at some examples that tie seemingly neutral investment decisions to harmful practices that exacerbate issues like the racial wealth gap, job quality, education, housing, and health. We will discuss some of the real actions investors can take – and also try to get some ideas from the audience on obstacles to this approach.

Speakers:

• Andrea Armeni, Co-Founder and Executive Director of Transform Finance
• Lisa Hayles, Investment Manager at Trillium Asset Management
• Renaye Manley, Board Member of Majority Action, the Council of Institutional Investors, and the Thirty Percent Coalition 

Recording: 

Resources referenced: 

• How Investments Drive Injustice and What Investors Can Do About It | Transform Finance, September 2020
• Equity in the Boardroom: How Asset Manager Voting Shaped Corporate Action on Racial Justice in 2020 | Majority Action, 2020
• Racial Justice Investing Group - RJI is a coalition of investors, asset owners, and business leaders who are taking action for racial justice within our own organizations, as well as in our engagements with portfolio companies
• S&P 250 Workplace Diversity, Equity, and Inclusion Disclosure Scorecard | As You Sow 
• Nasdaq filed a proposal with the SEC to require Nasdaq-listed companies to disclose diversity statistics & have at least 2 diverse directors | Nasdaq is getting tremendous push back on their diversity proposal. It's important for all investors to submit supportive comments to the Securities and Exchange Commission (SEC) at [email protected]. To reference the talking points that have been disseminated via the Thirty Percent Coalition, contact Kaede ([email protected]). 

Topics

Select the topic that you're interested in learning more about and browse through the list of curated resources on social equity investing.

Setting Your Goals & Acting for Impact

Engage with IEN 

At Impact Shares we invest in change. It’s why we’re committed to changing the world of impact investing, one socially conscious ETF at a time. At Impact Shares, we help organizations translate their social values into an investable product that is traded on the NYSE. Being a part of our ETFs means committing to an evolving set of criteria, defined by our non-profit partners, to ensure ongoing alignment of corporate behaviors with social values. With all net profits going directly back to these non-profit partners, together we’re making money go farther and do more. Creating an impact that is both reflected in portfolios and felt in the world all around us.

www.impactshares.org/ 

The Leading Mission-Aligned Investing Network for Higher Education and Other Endowed Institutions

Our vision is that all endowed institutions mobilize capital to create a world where all people thrive with equal access to personal and economic opportunity.

Our economic system's prioritization of short-term returns over long-term value creation has exacerbated the issues of climate change, racial injustice, and widening economic inequality. Intentional Endowments Network encourages and supports higher education institutions to adopt long-term investment strategies that create an equitable, low-carbon, and regenerative economy.

We believe that higher education institutions are influential actors with power to drive systemic change - to benefit themselves and society as a whole.

Higher education and other social purpose institutions are making critical choices every day about how to operate in a society and economy facing multiple intersecting crises. The higher education sector  educates 20 million students per year in the US, who are society’s future leaders and professionals. It helps solve current problems, anticipate tomorrow’s challenges, and serve as a model in all of its actions, including endowment investing. 

Our goal is for the 2,000 higher education institutions, totaling $650 billion in endowment assets and $890 billion in retirement funds, to invest in ways that accelerate the shift to an equitable, low carbon, and regenerative economy. We are also working to ensure higher education institutions develop the next generation of leaders committed to this type of economy through student managed investment funds and sustainable investing curriculum.

About the Intentional Endowments Network

The Intentional Endowments Network is a non-profit, peer-learning network advancing intentionally designed endowments – those that seek to enhance financial performance by making investments that advance an equitable, low carbon, and regenerative economy. Working closely with leading organizations, the network engages leaders and key stakeholders from higher education, foundations, business, and nonprofits. It provides opportunities for learning and education, peer networking, convening, thought leadership and information exchange around a variety of strategies (e.g., ESG integration, impact investing, and shareholder engagement). 

IEN is committed to making diversity, equity, inclusion and justice (DEIJ) part of the culture and the strength of our organization and work.

Our programming goals include dismantling racism and supporting the careers and professional development of traditionally marginalized or underrepresented groups to help create a more equitable and just society, aligning with the mission of the organization. Read our full DEIJ Statement on the Commitment to DEIJ page.   

Read about IEN's history.

Demonstrate and advance your leadership in creating a low-carbon, regenerative, and equitable economy by becoming a member of the Intentional Endowments Network today.

IEN is an initiative of The Crane Institute of Sustainability, a tax-exempt 501(c)(3) non-profit. 

For more on what the Network has accomplished, see IEN's Latest Impact Report.

Call for IEN Members to Sign On to the Belonging Pledge – A Commitment to Advance Racial Equity 

IEN is pleased to partner with Confluence Philanthropy to support the Belonging Pledge.  Please see the details below, and consider making this easy but powerful commitment to put racial equity on the agenda of your next investment committee meeting.  For individuals who attended college or university, please consider sending this opportunity to your alma mater's investment office. 

BACKGROUND: 

The events of spring 2020 will be chronicled as the next milestone in the fight for racial justice and equality.  A global pandemic, resulting in unemployment for 40 million Americans, followed by yet another brutal death at the hands of police officers set off a wave of protests and civil unrest in more than 75 U.S. cities

In response, Confluence Members and partnering investor networks launched a pledge for racial equity called the Belonging Pledge, #2020belongingpledge.

The commitment recognizes that racial equity belongs throughout the investment process, in the investment committee meeting, and, ultimately, in how decisions are made about capital deployment. Achieving racial equity is typically presented as daunting, perhaps even unattainable for some minds. But change is possible with sincere commitment, clear goals, and measurable benchmarks. Most importantly, change must begin with a shift in the prevailing racially homogenous culture and exclusivity that ultimately perpetuates racial bias and inequity within the investment industry and investors’ portfolios.

Read more here.

CALL TO ACTION: 

“We commit to discussing racial equity at our next investment committee meeting. We will move our agenda forward on this. We will share our next steps and results (perhaps privately), so that we can help to identify industry-wide barriers and the technical resources required to advance the practice of investing with a racial equity lens.”

If you would like to sign onto the pledge, please email us at [email protected]. 

SIGNATORIES: 

We encourage endowments and other investors to join over 100 signatories and partners listed below representing $1.88 Trillion in AUM in committing to the pledge and putting racial equity on your investment committee agenda (see full list of signatories). If you would like to sign on to the pledge, please email us at [email protected].

3x5 Partners
45North Partners
Abacus Wealth Partners
Adasina Social Capital
Agility
Aiim Partners
AJL Foundation
Align Impact
Amalgamated Bank
Angeles Investment Advisors
Antonique Smith
Aprendamos-Covarrubias Family Foundation Fund
Arborview Capital
Arizona State University Enterprise Partners
Arjuna Capital
Athena Capital
Avivar Capital
Ballentine Partners
Bivium Capital Partners
Blended Value Group
Blue Highway Growth Capital
Babcock Consulting
Bonwood Social Investments
Boston Common Asset Management
Boston Impact Initiative
Boston Trust Walden
Breckinridge Capital Advisors
Bronze Investments
Bushnell-Kessel Giving Fund
The California Endowment
California State University, Dominguez Hills
The California Wellness Foundation
Calvert Impact Capital
Cambridge Associates
Capital for Change
Capricorn Investment Group
The Caprock Group
Capshift
Catalyst at Large
Ceniarth LLC
Change Finance
City Light Venture Capital
Clean Yield Asset Management
CNote
Cogent Consulting PBC
The Conduit Connection
Commonfund
Community Capital Advisors
Community Capital Management
Community Credit Lab
Community Investment Management
Community Reinvestment Fund
Compton Foundation
Congruent VC
Cornerstone Capital
Christensen Family Foundation
Craig Young Family Foundation
Croatan Institute
CSFund
The David Rockefeller Fund
Dietel and Partners
Domini
East Bay Community Foundation
EcoEnterprises Fund
EFM Investment and Advisory
Energy Foundation
Equivico
Fair Food Network
Felix Family Foundation
FFI  
Figure 8 Investment Strategies 
First Affirmative Financial Network
Flat World Partners
Fresh Pond Capital
Friends Fiduciary Corporation
Fund for Democratic Communities
The Fund for New Jersey
Gary Community Ventures
Generation Investment Management
Global Endowment Management (GEM)
Godeke Consulting
Gratitude Railroad
Green Alpha Advisors
Green Retirement, Inc.
GRID 202 Partners
Grove Foundation
HCAP Partners
High Noon Advisors
Honeytree Investment Management
Horizons Sustainable Financial Services
ICA Fund Good
Ides Capital
Impact America Fund
Impact Assets
Impact Shares
Impax Asset Management
Inclusive Prosperity Capital
Integrated Capital Investing
Interfaith Center on Corporate Responsibility (ICCR)
Invesco
Investor Advocates for Social Justice
Investure, LLC
i(x) investments
J Aduke Consulting
Jantz Management LLC
Jessie Smith Noyes Foundation
John Merck Fund
Jonathan Rose Companies
JumpScale
KBI Global Investors
Laird Norton Family Foundation
Libra Foundation
Local Initiatives Support Corporation (LISC)
Local Invest New Mexico
Low Income Investment Fund (LIIF)
Lupoff Friends and Family Interests LLC
Marigold Capital
The Mary Reynolds Babcock Foundation
Mennonite Education Agency Investment Fund
The Mighty Arrow Family Foundation
Mission Driven Finance
Montcalm TCR LLC
Morgan Family Foundation
MOZAIK Philanthropy
MultiGreen Properties, LLC
Nathan Cummings Foundation
Natural Resources Defense Council (NRDC)
Natural Investments
New Energy Nexus
New U Venture Partners
Nia Community Fund
Northfork Financial
Northlight Foundation
North Berkeley Wealth Management
Northstar Asset Management
Ocean Foundation
Omniresearch Group
Pathstone
Patagonia Tin Shed Ventures
Penney Family Fund
Pratt Institute
Rally Assets Inc. 
Reinventure Capital
Renewal Funds
Rethink Education
Reynders, McVeigh Capital Management, LLC
Roanhorse Consulting 
Robert & Patricia Switzer Foundation
Rockefeller Brothers Fund
Rockefeller Philanthropy Advisors
Root Capital
Roy and Patricia Disney Family Foundation
RSF Social Finance
The Russell Family Foundation
San Francisco Foundation
The Sapelo Foundation
Scherman Foundation
The Schmidt Family Foundation
Sierra Club Foundation
Singing Field Foundation
Solidago Foundation
Social Impact Capital
Sonen Capital
Southern Reconstruction Fund
Springcreek Foundation
SRI Wealth Management Group, RBC Wealth Management
Strategic Investment Group
Sunwealth Power
SustainVC
Syntrinsic Investment Counsel
Terra Alpha Investments
Tiedemann Advisors
TIFF Investment Management
Thomas Scattergood Behavioral Health Foundation
Threshold Foundation
Trillium Asset Management
Turner Impact Capital
UpSpring
Uprising
Veris Wealth Partners
Wallace Global Fund
Warren Wilson College
Warsh-Mott Legacy
Wege Foundation
Westfuller Advisors
Wetherby Asset Management
Whistle Stop Capital
William Caspar Graustein Memorial Fund
Winthrop Rockefeller Foundation
Wireframe Ventures
Woodcock Foundation
Zeal Capital
Zevin Asset Management, Inc.

PARTNER NETWORKS

Diverse Asset Managers Initiative (DAMI)
GenderSmart
Hip Hop Caucus
Impact Capital Managers
Intentional Endowments Network
Investor Advocates for Social Justice
Native Women Lead
Net Impact
Social Venture Circle
The ImPact
U.S. Impact Investing Alliance
USSIF

This is your peer learning and professional development platform designed to generate knowledge exchange, and the co-creation of resources covering key innovations and trends in endowment management. The Network generates resources and convenings focused on key trends and practices with the guiding principle of generating profits by investing in a thriving, regenerative, and inclusive economy.

We encourage you to connect with others and suggest new activities or projects that would be helpful to you and your organization’s work related to expanding sustainable investing. We invite you to share your feedback on IEN’s activities on an ongoing basis with the IEN team and via the annual membership survey.

The 2020 Higher Education Climate Leadership Summit will be held in partnership with Second Nature from February 23-25, 2020 in Atlanta, Georgia.

The Higher Education Climate Leadership Summit is the largest national gathering of higher education presidents, chancellors, trustees, and other senior leaders working to accelerate climate solutions through all aspects of institutional activities -- education, research, campus operations, community engagement, and endowment investing. 

Read a recap of the 2020 summit here or watch recorded sessions:

• Endowment Investing Forum (full playlist)
  • Keynote Conversation - Katherine Collins and Matt Orsagh
  • Panel - Learning, Building Consensus, and Setting Policy, featuring California State University, University of New Hampshire, University of Massachusetts, and Wespath Institutional Investments
  • Panel - Implementation - Getting Traction featuring Arizona State University, North Carolina State University, Concordia University, and Warren Wilson College
  • Panel - Implementation Across Asset Classes featuring J Aduke Consulting, EcoSystem Integrity Fund, Graystone Consulting, and Global Endowment Management
• Main Stage Plenary Sessions (full playlist)
  • Keynote Speakers: Nathaniel Smith and Katharine Wilkinson
  • Keynote Speaker: Gina McCarthy
  • Keynote Speaker: Varshini Prakash
  • Social Equity Breakfast Discussion
  • Panel: Aligning Higher Ed Endowment Investing with Climate Leadership Goals

For more details on the 2020 Summit, and to learn about future Summits, please visit the Summit website: www.HigherEdClimateSummit.org

On September 6th, 2019, IEN organized the ESG & Community Impact Investing Roundtable at the Haas School of Business at the University of California, Berkeley. The half-day event brought together a diverse group of endowment decision-makers, investment firms, nonprofit leaders and other stakeholders looking to enhance environmental, social, and governance (ESG) integration into their investment process to positively impact communities near their campuses and around the world. 

Intentionally Designed Endowments Roundtable

ESG & Community Investing

Berkeley-Haas, September 6, 2019

ACTION PLANNING SESSION OUTCOMES

Below please find the ideas for action and continued conversation that emerged from the closing action planning session at IEN’s ESG & Community Investing Roundtable at Berkeley-Haas on September 6th, 2019. 

For those who proposed each idea -- if you would like to continue the conversation via email and/or by convening a conference call with the others who added their names on post-it notes, please email the group listed under your idea and copy Kaede Kawauchi ([email protected]). 

If you are interested in one of the groups, and your name is not included on the list, please let us know and we will add it and connect you with the person who proposed that group. (*please note: some of the post-it notes fell off the board before we had a chance to take pictures, so please double check that your name is included under each group in which you are interested!) 

Intersection between Opportunity Zones and green bonds as well as indigenous rights

• Katherine Hawthorne
• Jacob Moore
• Sean Martin 

Investing in cooperatives that are led by people of color 

• Jessel Amin
• Rachel Schlueter

Partnership between universities and investment managers 

• Katherine Hawthorne

Connecting university endowments to campus initiatives and programs  

• Trey McDonald
• Katie Parker

Connecting university endowments to surrounding communities

• Felicia Davis
• Jessel Amin
• Amir Kirkwood
• Katherine Hawthorne
• Trey McDonald
• Rachel Schlueter
• Katie Parker

Centralized due diligence + Impact Tracking + Financial Tracking

• Tyler Jackson
• Stephen Malta

Convening around investments in diverse managers

• Jacob Moore
• Sandy Lee

Impact investing practicum @ Haas

• Arpan Soparkar

Role of student managed funds (SIILK Network)

• Katie Parker
• Megan Morrice

Mission-first money creating opportunities that "traditional" dollars can then follow/invest in

• Stephen Malta
• Amir Kirkwood

Metrics of community impact

• Sean Martin
• Laura Young

Storytelling around good investments and founders (esp. diverse-owned)

• Trey McDonald
• Solome Tibebu

Changing narrative about tradeoff between impact + returns

• Amir Kirkwood

Connecting talent to Impact Industry 

• Cathy Garza

Case Studies, Surveys, and Video Series

• Warren Wilson College: Impacting How Companies Do Business l Intentional Endowments Network, 2022
• Commitment to Sustainability: Investment Strategies at the University of Illinois System l Intentional Endowments Network, 2022
• Warren Wilson College: Active Ownership In The Endowment | Intentional Endowments Network, 2020
• Arizona State University Case Study | Intentional Endowments Network, 2018
• Hampshire College Case Study| Intentional Endowments Network, 2017
• Financial Performance of Sustainable Investing: The State of the Field and Case Studies for Endowments | Intentional Endowments Network, 2020
• State of the Sustainable Investing Field for University and College Endowments | Intentional Endowments Network 
• Celebrating the Leaders Video Series | Intentional Endowments Network
• Impact Update Newsletter Series: Intentionally Designed Endowments Making a Difference | Ongoing
• Intentional Endowments Network Survey of Peer Studies | Intentional Endowments Network, 2018
• Matching Investments to Mission | David Ellis, CFO, Becker College & IEN Member, NACUBO's Business Officer Magazine, March 2018
• Environmental, Social and Governance Investing by College and University Endowments in the United States:  Social Responsibility, Sustainability, and Stakeholder Relations | IRRC Institute and Tellus Institute, July 2012

Sustainable Investing Action Organized by Name of Institution

Look at each institution individually to see what initiatives they have committed to or click the logo of a particular initiative to look at all the institutions in our growing database that participate.

Sustainable Investing Action Organized by Activity

Look through each sustainable investing activity to learn more and see which schools have implemented these changes. 

Sustainable Investing Action Organized by Year

Can sustainable investments achieve performance objectives? 

Addressing key material factors that have often not been considered investment decisions can help investors maximize a portfolio’s risk and return profile. In addition to addressing constituent concerns, incorporating material environmental, social, and governance factors into an investment decision value chain can enhance long-term returns, decrease risk by providing downside protection, and deliver portfolio benefits such as diversification and reduced volatility. 

Reports and Resource

• Do ESG Efforts Create Value? | 2023 Research by Bain & Company and EcoVadis indicates that there is a connection between sustainability and business results in the areas of sustainable supply chain, renewable energy, employee satisfaction, and DEI. Companies and private equity funds can realize financial returns while accelerating their ESG transition.
• Does Sustainability Generate Better Financial Performance? Review, Meta-Analysis, and Propositions | 2023  This research surveyed 1,141 primary peer-reviewed papers and 27 meta-reviews published between 2015 and 2020 on to examine ESG financial performance. The collective sample suggest that the financial performance of ESG investing has on average been indistinguishable from conventional investing 
• The Financial Impact of Fossil Fuel Divestment | Auke Plantinga & Bert Scholtens research finds that the investment performance of portfolios that exclude fossil fuel production companies does not significantly differ in terms of risk and return from unrestricted portfolios - August  2020 
• ESG and Financial Performance: Uncovering the Relationship by Aggregating Evidence from 1,000 Plus Studies Published between 2015 – 2020, NYU Stern Center for Sustainable Business, partnered with Rockefeller Asset Management to provide a Meta-studies examining the relationship between environmental, social, and governance (ESG) and financial performance have a decades-long history
• Investing in Our Mission: A Five-Year Case Study of Fossil Fuel Divestment at the Rockefeller Brothers Fund — A Case Study of Fossil Fuel Divestment at the Rockefeller Brothers Fund, May 2020
• Financial Performance of Sustainable Investing: The State of the Field and Case Studies for Endowments,  Intentional Endowments Network, February 2020 - provides a collection of real-world cases of college and university endowments implementing sustainable investment strategies and meeting their financial performance targets.
• Where ESG Fails, Intitutional Investor, A case study to show that responsible investing deliver alpha, October 2019
• The Business Case for ESG, Intentional Endowments Network, March 2016 - defines ESG investing is, describes how ESG investing and analysis can be approached, and addresses how ESG investing strategies perform financially.
• Seeing SRI in Context, Steffon M. Gray, assistant director, research and policy analysis, NACUBO, March 2019. Compares the performance of 2017 NACUBO-Commonfund survey participants who integrate responsible investing practices with those who don't and finds no significant difference except among the largest endowment where those with responsible investing practices outperformed those without.
• Paper on financial performance of ESG integration in US investing, Principles for Responsible Investment, February 2018 —Summarizes the findings on ESG materiality in three empirical studies
• Sustainable Investing and Bond Returns, Barclays, October 2016 — Examines the relationship between ESG investing and performance in the US corporate bond markets and finds that the incorporation of ESG factors into the analysis of bonds had a small but consistent performance benefit.
• Corporate Sustainability: First Evidence on Materiality (pdf), Mozaffar Khan, George Serafeim, Aaron Yoon, March 9, 2015 — Found that firms with good ratings on material sustainability issues significantly outperform firms the poor ratings on these issues. 
• The Impact of Corporate Sustainability on Organizational Processes and Performance (pdf) | Robert G. Eccles, Ioannis Ioannou, George Serafeim, Harvard Business School, July 2013 — 18-year study (1993-2011) showing that 90 companies with strong sustainability policies outperformed a similar group of 90 companies with low sustainability standards, with a 4.8 percent higher annual above-market average return.
• Allocating Capital for Long-Term Returns, Generation Foundation, May 2015 - Makes the investment case for sustainable capitalism
• Excerpt from GMO The Race for Our Lives — An analysis of the performance impact of divesting from various S&P 500 sectors. 
• Financial performance implications of divesting from U.S. fossil fuel stocks — IEN online resource, January 2015 - compares the performance of the Russell 3000 Index to an optimized portfolio of Russell 3000 Index stocks without consumable fuel stocks over rolling 3 year periods spanning 25 years from 1988-2013.
• Video: How a Sustainable Investing Lens leads to Better Stock Selection —  Keynote Address by David Blood, Co-Founder & Senior Partner, Generation Investment Management at the 2016 Intentionally Designed Endowment Forum 

David Blood discussing sustainability and stock selection at 2016 IEN Forum

Can sustainable investments meet fiduciary requirements of care and diligence?

As more and more sophisticated investors find long-term competitive advantages in strategies that incorporate material environmental, social and governance ("ESG") factors into investment analysis, prudent adoption of mission-aligned investment techniques is consistent with fiduciary duties.

Reports and Resources 

• ESG is Dead – Long Live ESG: Guidance for US Pension Fiduciaries, Keith Johnson, Rick Funston, Tiffany Reeves, BoardSmart, May 2023
• A Legal Framework for Impact, Freshfields, PRI, Generation Foundation, and UNEP FI, July 2021
• Intergenerational Equity and Sustainable Investing, Commonfund, George Suttles, April 2020
• Incorporating ESG Factors into Corporate Governance, ValueEdge, January 2020
• What Should Trustees Do About Climate Change?, Aon, August 2019
• Commentary: Fiduciary duty yellow flags for proxy season, Pensions & Investments, Keith Johnson, Susan Gary, and Cynthia Williams, April 2018 
• Best Interests in the Long Term: Fiduciary Duties and ESG Integration, Social Science Research Network, Susan N. Gary, University of Oregon, February 2018
• Leading Practice Briefing on Fiduciary Duties for Endowments and Foundations, Intentional Endowments Network, prepared by Megan Jackson and Keith Johnson at Reinhart Boerner Van Deuren s.c., February 2017
• Application of Fiduciary Duty to Sustainable Investment Practices, Susan N. Gary (University of Oregon), Keith L. Johnson & Megan K. Jackson (Reinhart Attorneys at Law), November 2015
• Cambridge Handbook of Institutional Investment and Fiduciary Duty - Chapter 8, June, 2014
• Chapter 16 of Sustainable Investing: The Art of Long Term Performance, Stephen Viederman, 2008
• To join the discussion, join our Fiduciary Duty and Policy Working Group
• Video: Panel from the April 2014 Intentionally Designed Endowments Conference featuring:
  • Jay Youngdahl, The Youngdahl Law Firm
  • Susan Gary, University of Oregon School of Law
  • Keith Johnson, Reinhart Boerner Van Deuren s.c.
  • Moderator: David Dinerman, Hampshire College Trustee