The theme of this month’s IEN newsletter is clean energy investing.
The School Spotlight highlights a unique financing arrangement Luther College implemented to increase the bottom line on a wind turbine project. Our feature article was developed by and in consultation with members of IEN's Clean Energy Working Group, and created to encourage conversation about the financial and societal benefits of clean energy investments higher education can make – both as a customer and an institutional investor through their endowments.
We have numerous updates to share including an overview of our recent forums, the announcement of three new team members, and several new projects that are gaining traction. We are pleased to report that sustainable investing continues to grow at a very rapid rate as indicated by the Report on US Sustainable, Responsible, and Impact Investing Trends 2016 that is featured in our resource section. According to the report, US sustainable investing grew 33% from 2014 to 2016. In 2016, the market size of sustainable investing in the US is $8.72 trillion, or 22% of all investment under management in the US. These are incredibly important milestones that inspire us to continue taking this critical work forward.
As always, your contributions to the conversation are welcome and needed. Please be in touch with any questions, news or ideas for the IEN.
Tony Cortese & Georges Dyer
School Spotlight: Luther College
One of the main barriers with using endowments or operation budgets to finance clean energy is that the college or university cannot use state and national tax incentives like for-profit investors can. Nonprofits need tax equity partners in order to realize the benefit of these federal and state tax incentives. Wanting to increase the financial returns and bottom line of a 1.6 megawatt wind turbine (a $3.2 million project), Luther College established a for-profit corporate entity, Luther College Wind Energy Project, LLC (LCWEP). The LCWEP receives Iowa’s 476C tax credit for renewable energy, and these tax credits add about $50,000 per year to the project’s bottom line. Read more about the project here.
Feature Article: Investing in Clean Energy: Campuses and Endowments
IEN’s new report, “Investing in Clean Energy: Campuses and Endowments”, was designed to encourage conversation about the financial and societal benefits of clean energy investments higher education can make – both as a customer and an institutional investor through their endowments. It explores the current opportunities and barriers to such investments. Click here to access the “Investing in Clean Energy: Campuses and Endowments” report.
Featured Event: 2017 Presidential Climate Leadership Summit
February 13-15, 2017, Tempe, AZ
The 2017 Presidential Climate Leadership Summit is a significant moment and turning point for Second Nature and the Climate Leadership Network. Second Nature will reflect on 10 years of bold climate leadership by higher education institutions, and anticipate the future of the Network and the sustainability movement. The 2017 Summit is designed for campus sustainability teams, including specialized content for presidents, faculty, and staff. IEN is organizing a session at the Summit and will hold a half-day workshop on intentionally designed endowments for presidents, trustees, CIOs and sustainability staff. Click here for more information and to register.
Updates from the Network
IEN Welcomes Jacquelyn Smith, Charles Sandmel and Nicole Harman to the Team
We are pleased to announce that Jacquelyn Smith has joined our team as a Senior Fellow. Jacquelyn comes to IEN with 7 years of experience in strategic management and consultative sales in the energy industry. Jacquelyn holds a B.A. in Communication from the University of Massachusetts, Amherst and an M.B.A. in Economics of Financial Markets from Bentley University. You can read her full bio here.
Charles Sandmel became a Senior Fellow at the Intentional Endowments Network to continue his pioneering work in the integration of sustainability and fixed income investing. His current focus is supporting wider bond investment in green infrastructure projects in furtherance of the COP21 goals through the development of ISO-type standards for green bonds. Most recently, Charles worked as a Portfolio Manager at Shelton Capital Management. You can read his full bio here.
Nicole Harman has joined our team as a Program Associate. Nicole graduated from Green Mountain College in May 2016 with a B.A. in Renewable Energy and Ecological Design, as well as a B.A. in Institutional Sustainability and Economic Policy. In her time there she worked in the College’s Sustainability Office, holding positions including Sustainability Office Manager and Interim Director of Sustainability. You can read her full bio here.
Intentionally Designed Endowments Forum at Loyola University Chicago on November 1-2, 2016
This month, in partnership with Loyola University Chicago, IEN hosted an Intentionally Designed Endowments Forum with keynote speakers Hank Paulson, former U.S. Secretary of the Treasury, chairman of the Paulson Institute, and co-chair the Risky Business Project, David Blood, co-founder and Senior Partner of Generation Investment Management, and Jeremy Coller, CIO of Coller Capital, and Chair of The Jeremy Coller Foundation. To learn more about this event click here. Videos of the speakers and their presentations will be available soon.
Intentionally Designed Endowment Forum at San Francisco State University on August 25-26, 2016
The San Francisco State University Foundation and the Intentional Endowments Network were pleased to host this forum that brought together decision-makers including presidents, trustees, CFOs, CIOs, and other key stakeholders by invitation only from campuses in California and the region to advance the conversation on endowment investing in the context of 21st century sustainability challenges. Participants heard from Jagdeep Bachher, Chief Investment Officer and VP of Investments at the University of California, who manages the UC system’s $91 billion in endowment, pension, and other assets.Videos of the speakers and their presentations are available here.
Innovations in ESG at Bloomberg, June 13, 2016
IEN co-hosted an event at Bloomberg’s offices in NYC with the Henley Business School at University of Reading. The one-day event focused on fostering a vibrant knowledge exchange between academic innovation and industry application. Approximately 120 people attended. It was a very successful event and a positive step towards helping to bridge the academic activities around sustainable investing on campuses with endowment investing practices. To read more about the event, click here.
IEN Project Updates:
Higher Education and the Paris Climate Agreement
IEN is partnering with the World Resources Institute (WRI) to develop a multi-actor 3-5 year project on how higher education endowments can work toward meeting the goals of the Paris Climate Agreement. On October 10th, IEN hosted a session at the AASHE Conference in Baltimore on this topic with representatives from IEN member organizations Cambridge Associates, Impax Asset Management, Second Nature, and the Sustainable Endowments Institute. IEN and WRI are hosting an initial planning meeting on December 5th at WRI with approximately 15-20 participants from schools, non-profits, the investment industry, and foundations to generate conceptual ideas and identify potential partners for a longer-term project in this area.
Fiduciary Action on Climate Change
IEN is working with the Responsible Endowments Coalition and other partners to support peer-to-peer learning and leadership development amongst fiduciaries at small and medium funds who want to implement the recommended process guidelines outlined in the 2015 REC-SEIU report, “Action on Climate: A Practical Guide for Fiduciaries.” IEN has confirmed a group of trustees to participate, and held initial kick-off calls to walk through the toolkit and begin sharing stories about how the various funds are approaching climate risk and climate action in their portfolios. A second call was held in September to discuss any progress, barriers to address as well as discuss current and potential resources that can help the trustees in their endeavors. The group will continue to convene each quarter to discuss progress, and evaluate the usefulness of the tool.
Clean Energy Working Group: New White Paper, Forum Presentation, & Upcoming Webinar
The “Investing in Clean Energy: Campuses and Endowments” White Paper was developed by and in consultation with IEN’s Clean Energy Working Group. It was designed to encourage conversation about the financial and societal benefits of clean energy investments higher education can make – both as a customer and an institutional investor through their endowments. Members of this working group also presented a session at our Forum at Loyola University Chicago, and are hosting a webinar early next month. To read about our other working groups, click here.
Business Case for ESG Briefing Paper
IEN’s "Business Case for ESG" briefing paper was developed to help endowment stakeholders understand what ESG investing is, how ESG investing and analysis can be approached, and how ESG investing strategies perform financially. This briefing paper was developed by and in consultation with members of IEN's ESG Business Case Working Group. Click here to access The Business Case for ESG Briefing Paper (pdf).
Engaging Investment Managers on Proxy Voting & Other Forms of Shareholder Engagement
IEN’s “Engaging Investment Managers on Proxy Voting & Other Forms of Shareholder Engagement" document outlines potential questions for investment managers on their proxy voting and other shareholder engagement activities around ESG. Click here to access the "Engaging Investment Managers on Proxy Voting & Other Forms of Shareholder Engagement" document.
In the past few months IEN has hosted the following webinars (follow each link to view recordings on our website):
- Transitioning to Integrating Investment Practices with Program Mission l Presented in partnership with the Heron Foundation and Hampshire College (October 19, 2016)
- Carbon and Investment Implications for Fiduciaries l Presented in partnership with Commonfund (September 27, 2016)
- Introduction to Proxy Voting l Presented in partnership with the Sustainable Investment Institute and Nathan Cummings Foundation (July 13, 2016)
Other Events (Non-IEN)
RI Americas 2016: Long Term Value Creation l Responsible Investor and Bloomberg, December 6-7, 2016, New York, NY
2017 Presidential Climate Leadership Summit| Second Nature, February 13-15, 2017, Tempe, AZ
To view more upcoming events, click here.
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.
White Paper: Investing in Clean Energy: Campuses and Endowments l Intentional Endowments Network, November 2016
Engaging Investment Managers on Proxy Voting & Other Forms of Shareholder Engagement l Intentional Endowments Network, September 2016
The Business Case for ESG | Intentional Endowments Network, April 2016
Factory Farming: Assessing Investment Risks 2016 Report l Farm Animal Investment Risk and Return (FAIRR), 2016
Fiduciary Duty in the 21st Century U.S. Roadmap l Principles for Responsible Investment, United Nations Environment Program Finance Initiative and The Generation Foundation, 2016
State of the Industry Analysis: TIIPing Points 2016 l The Investment Integration Project (TIIP), November 2016
Investment Policy: Process & Practice: Asset Owner’s Guide to Complete ESG Incorporation l Principles for Responsible Investment, October 2016
Out of the Starting Blocks: Tracking Progress on Corporate Climate Action l CDP, October 2016
Fossil Fuel Divestment: A Practical Introduction l Meggin Thwing Eastman, MSCI, September 2016
Investing in Equality: Integrating LGBT Issues into Total Portfolio Activation l Croatan Institute, Social Justice Fund Northwest, Out Leadership & Trillium Asset Management, September 2016
2016 Proxy Mid-Season Review l Sustainable Investments Institute, September 2016
Rockefeller Brothers Fund: A Case Study in Impact Investing l The ImPact, September 2016
Achieving the Sustainable Development Goals: The Role of Impact Investing l Global Impact Investing Network, September 2016
"Alpha-Generating Potential and Value of Integrated ESG Analysis" l Calvert Investments, June 2016
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.
- The Association for the Advancement of Sustainability in Higher Education's 2016 Sustainable Campus Index l AASHE
- Report on Higher Ed Clean Energy Investmentsl Inside Higher Ed
- What Will Trump's Election Mean for College Endowments? l Education Dive
- The CFA Exam Is Going Green l Bloomberg
- The Trump Effect on Environmental Investing: Positive? l The New York Times
- Landmark Carbon Dioxide Concentration Passed; Marks New Climate Era l National Geographic
- 2016 Will Be the Hottest Year on Record, UN Says l The Guardian
- Bridging the Divide: Climate Action (Video) l Cultivating Resilience
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].