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July 30, 2012 at 09:20 AM
Going back to anti-apartheid campaigns in the 1970s and before, university endowments were early adopters of new policies and institutions to address social and environmental considerations in investment.
But at a time when mainstream investors are incorporating environmental, social and corporate governance factors into their allocation decisions, college and university endowments are no longer leaders in the institutional ESG investment space, according to a new study by the Investor Responsibility Research Center Institute and Tellus Institute, nonprofit organizations that research such investments.
“Our findings indicate that today’s endowments no longer are leaders in the institutional ESG investment arena,” Jon Lukomnik, the IRRC Institute’s executive director, said in a statement.
The report found that endowments’ primary form of ESG investing activity tends still to be single-issue negative screening of public-equity portfolios related to issues such as tobacco or targeted divestment from the Sudan.
The study also found that despite considerable focus on proxy-voting recommendations, many colleges are shifting investments from publicly traded securities to indirect investments in commingled vehicles and more illiquid investments in alternative asset classes.
