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The 51��Ʒ��Ƶ has published its annual report on how environmental, social and governance (ESG) factors are used in the management of the University’s Consolidated Endowment Fund (CEF).

The update reflects the University’s commitment to providing greater clarity regarding how ESG factors are applied in the CEF’s investment decision-making process. The full report, along with links to the inaugural report and other related documents, can be .

This report is aligned with the University’s , which was adopted in March 2020. It also provides an update regarding the endowment’s fossil fuel exposure, in response to the recommendation of the Ad Hoc Committee on Fossil Fuels convened by the University’s Board of Trustees.

Key disclosures in the ESG report

It remains the University’s core belief that supporting responsible business practices is integral to producing strong investment outcomes. The new report explains that total exposure to fossil fuels within the CEF was 8.2% as of June 30, 2023, which represents a 0.1% increase from the prior year. Chief Investment Officer Jeffer Choudhry explained that the slight increase was not the result of new investment activity but was instead attributable to public fund holdings, which are expected to fluctuate over time and are outside the University’s direct control.

Reflecting the University’s commitment to ESG principles, the report states that 93% of external investment managers currently held by the CEF have formal ESG policies in place or take ESG considerations into account when making investments. “This reflects the state of the investment industry, where many managers are already taking certain ESG-related financial considerations into account in pursuit of stronger returns,” said Choudhry.

He further added that the University will continue to provide annual ESG updates. “51��Ʒ��Ƶ was one of the first universities to publish an ESG report for its endowment. With this third report, it remains our goal to enhance awareness and understanding regarding the endowment’s investment practices,” Choudhry said.

The endowment benefits the University community

As the University’s largest financial asset, the endowment supports financial aid, scholarships, faculty positions and research activities.

Choudhry reiterated the University’s commitment to ensure the endowment investments continue to support responsible business practices because they are integral to producing strong investment outcomes.

“We will also continue to monitor developments in ESG-related standards, particularly those that have direct financial impact on our investments. As those standards are developed, we will explore incorporating them in our investment process,” Choudhry said.