As part of the University's Sustainability Strategic Plan, Goal 6 is to implement a sustainable and ethical investment policy. Our aim is to develop this policy for all our investments and establish a transparent process of reporting on our investment decisions.
Investment Portfolio
The University currently has a combination of cash and investments through fund managers. As at 31/12/2023 our fund managers and investment products were:
M&G - Sustainable Total Return Credit Investment Fund
Neuberger Berman - Climate Transition Multi-Asset Credit
Baillie Gifford - Sustainable Multi-Asset Fund
Partners Group - Partners Fund
Ruffer – Charity Assets Trust
Royal London Asset Management - IG Short Dated Credit Fund, Short Duration Credit Fund and Short Term Fixed Income Enhanced Fund.
Our approach to sustainable investments, within Finance Policy 22 – Treasury Management outlines our approach and beliefs in relation to ethical & sustainable investments:
- The Investment Committee (IC) recognises the importance of Environmental, Social & Governance (ESG) factors. As such, the IC will consider investing the University’s assets in line with the Paris Aligned Investment Initiative, with a commitment to reducing carbon emissions and will consider aligning its portfolio to the goals of the Paris Agreement, assuming Governments remain committed to this Agreement. The IC will also consider other initiatives that enhance the commitment to the wider consideration of sustainability. Where the assets are not currently invested in line with these initiatives, the IC will look to ensure a just and workable transition over time.
- The IC believes that the assets should be invested through a sustainable and ethical investment policy which is in line with the University’s objectives, as set out in the University’s Sustainability Strategy.
- The IC believes in Engagement over Exclusion in relation to incorporating financially material ESG factors. This includes actively encouraging further progress from those assets which are currently behind their peer groups in terms of sustainability but are actively in the process of transitioning. However, the IC reserves the right to use Exclusion as a mechanism for certain circumstances.
- The IC believes that Climate change is a key ESG risk which should be specifically addressed within the investment strategy.
- The IC believes that both financial and non-financial considerations should be taken into account when it comes to setting the investment strategy. An example of taking into account non-financial considerations is excluding investments on the grounds of ethical and moral views, rather than because those investments are perceived to carry a high risk or may hinder performance.
Further information
- Investment Committee Terms of Reference.
- Audits of exposure to fossil fuels:
Key activities:
2020: Initiate annual audit of fossil fuel exposure in our portfolio
2020:
As at 31st December 2020, 0.8% of our portfolio was held within direct fossil fuel companies, and a further 0.8% within indirect fossil fuel companies. This represented a small proportion of our holdings at this date. Nevertheless, we remained committed to reviewing and refreshing our investment policy, to ensure our investments represent the values of the University.
2021:
As at 31st December 2021, 0.9% of our portfolio was held within direct fossil fuel companies, and a further 0.7% within indirect fossil fuel companies. The movement between the two periods is small as a proportion of our total holdings, and is a result of a number of factors including:
Improvement in the value of these holdings (within the funds we invest with)
Active engagement by fund managers to invest responsibly in companies and industries who positively affect our world in three key areas: environmental, social and governance (ESG)
2022:
As at 31st December 2022, 0.5% of our portfolio was held within direct fossil fuel companies, and a further 0.6% within indirect fossil fuel companies. The reduction is a result of active engagement by our fund managers to invest responsibly in companies and industries who make a positive impact on environmental, social and governance (ESG) factors.
2021: Put in place our sustainable and ethical investment policy
- This was successfully completed via an update to Finance Policy 22 – Treasury Management which included a focused section on our approach to sustainable and ethical investment.
- Our revised Treasury policy focuses on positive change through engagement, preferring companies that are moving towards responsible investment including renewable energy solutions, although we remain committed to an exclusion for thermal tar or coal sand industries.
- We are committed to investing in line with the Paris Aligned Investment Initiative and in accordance with the goals of the Paris Agreement.
- Our funds will align with Article 8 or 9 of the Sustainable Finance Disclosure Regulation (where applicable).