Sustainable Investment at UNH

UNH's Committment to Sustainability

  • Sustainability is a core value at the University of New Hampshire and it underpins our academics, research and practice. As part of UNH's ongoing institution-wide commitment to sustainability, the UNH Committee on Investor Responsibility (CIR) was formed in 2017 to help support the Foundation in sustainable, socially responsible investment practices and policies.
  • UNH has a longstanding history of sustainable initiatives and will continue to support them through our Foundation's investments.
  • As of March 2019, the University of New Hampshire (UNH) at Durham is one of only four institutions of higher education in the country to hold the STARS Platinum rating from the Association for the Advancement of Sustainability in Higher Education (AASHE). This recognition places UNH at the highest level of sustainability performance among colleges and universities. UNH's Platinum rating was made possible through a concerted, university-wide effort that engaged faculty, staff, and students in 2017, including substantial enhancements to sustainable investing initiatives at the Foundation.

ESG Investment Strategy

  • In addition to providing an opportunity for donors to align their personal values and investment philosophy, sustainable investing may offer a number of financial benefits. Companies with higher ESG standards may have better operational performance, innovation, risk management and reputations, leading to reduced costs. In many studies, sustainable investing has been linked to better financial performance, with positive correlations between sound sustainability practices and stock price performance.
  • The UNH Foundation takes a multi-pronged approach to our sustainable investing initiatives. This includes positive screening, negative screening, full ESG integration into financial analysis, and active ownership through shareholder engagement opportunities.
  • While no investment approach is guaranteed to be successful, the UNH Foundation's Board of Directors invests ESG-screened assets with a long-term view and monitors the investments of the ESG pool in the same manner as the traditional pool. As the ESG pool continues to grow with new endowed funds, additional investment opportunities will become available, and changes will be made accordingly. Totaling $40 million in March 2019, the asset allocation targets of the ESG pool are now as follows:
     

      Global Public Equity

      60%

      Hedge Funds

      20%

      Real Assets

      10%

      Fixed Income and Cash

      10%

     

  • The UNH Foundation also engages in community impact investing through New Hampshire Community Loan Fund bonds which help underserved people in NH more fully participate in the economic growth of our state.

Princples for Responsible Investment

On July 1, 2018, the UNH Foundation became a signatory in support of the United Nation's Principles for Responsible Investment, which are a set of six aspirational principles designed to encourage and assist investors in integrating ESG into their investment processes. As a signatory, we have committed to the following statement from the PRI and its six Principles for Responsible Investment:

UN PRI works to understand the investment implications of environmental, social and governance (ESG) factors and to support its international network of investor signatories in incorporating these factors into their investment and ownership decisions. The PRI acts in the long-term interests of its signatories, of the financial markets and economies in which they operate and ultimately of the environment and society as a whole.

 

PRI Principle

 

 

UNH Foundation Current Priorities

 

Principle 1
We will incorporate ESG issues into investment analysis and decision-making processes.

1. Integrate consideration of ESG factors into our investment and operational due diligence policies, and into other policies where relevant and material.
2. Evaluate ESG-related risks across all portfolios.
3. Integrate ESG considerations into our manager selection process, where relevant and material.

Principle 2
We will be active owners and incorporate ESG issues into our ownership policies and practices.

1. Participate in collaborative engagement initiatives.
2. Encourage managers to adopt ESG-focused voting policies, where relevant.

Principle 3
We will seek appropriate disclosure on ESG issues by the entities in which we invest.

1. Discuss ESG risks in manager portfolios and in relation to particular securities held.
2. Ask managers to undertake and report on ESG-related engagements with companies.
3. Support collaborative initiatives promoting ESG disclosure by companies.

Principle 4
We will promote acceptance and implementation of the Principles within the investment industry.

1. Communicate ESG expectations to managers.
2. Support the development of tools for benchmarking ESG integration.
3. Support regulatory or policy developments that enable implementation of the Principles.

Principle 5
We will work together to enhance our effectiveness in implementing the Principles.

1. Support and participate in networks and information platforms to share tools and pool resources.
2. Collectively, with other asset owners and managers, address relevant emerging issues.
3. Identify and support appropriate coalitions whose beliefs are aligned with the Principles.

Principle 6
We will each report on our activities and progress towards implementing the Principles.

1. Disclose how ESG issues are integrated within our investment practices.
2. Disclose active ownership activities (e.g. voting, engagement, and policy dialogue).
3. Communicate with stakeholders on ESG issues and the Principles.
4. Report on progress and achievements relating to the Principles.
5. Make use of reporting to raise awareness among a broader group of stakeholders.

Selection, Appointment, and Monitoring of Fund Managers

Integrating ESG factors into our manager selection and monitoring process is a responsibility shared by the investment committee, Foundation staff and our investment consultants. We consider ESG factors when evaluating managers, and are developing a more rigorous evaluations process. Our engagement with fund managers will feature passive and active strategies to ensure they are acting in our best interest and we are maintaining appropriately active ownership. The actions listed below describe elements of the Foundation's current process that will be undertaken for all managers, where possible and relevant.

  • Review manager's responsible investing policies.
  • Issue ESG due diligence questions annually, review responses and follow-up where appropriate.
  • Include responsible investment as a standard agenda item at annual performance review meetings.

Below are a list of example due diligence questions that the Foundation and its investment consultant may use to engage with our fund managers:

  • How, and to what extent, does your firm engage on ESG issues with the companies in which you invest? Please provide examples.
  • On what issues do you typically engage senior management of portfolio companies?
  • Do you disclose your engagement activities to your clients or publicly?
  • Do your analysts incorporate the potential impact of climate change, including environmental and regulatory changes, into their assessment of a company's value? Please provide examples.

Active Shareholder Ownership

The UNH Foundation will occasionally have opportunities to exercise its right to vote on shareholder resolutions, and will pay special attention to those which present issues related to ESG matters. In considering proxies on environmental, social, and governance matters, the Foundation works closely with its Committee on Investor Responsibility.

  • Direct conversation with investments and fund managers
  • Participating in proxy voting
  • Signing on to collaborative initiatives to engage with companies
  • Voting on shareholder resolutions relating to ESG issues

Disclosure

The UNH Foundation provides a list of the underlying holdings in the University's pooled funds.

Collaboration

We have joined initiatives that are aligned with — and help guide — our approach to sustainable investment, and we actively work with peers and investors to advance shared goals.

  • UN PRI
    The PRI will work to achieve a sustainable global financial system by encouraging adoption of the Principles and collaboration on their implementation; by fostering good governance, integrity and accountability; and by addressing obstacles to a sustainable financial system that lie within market practices, structures and regulation."
     
  • The Sustainability Tracking, Assessment & Rating System™ (STARS•)
    STARS is a transparent, self-reporting framework for colleges and universities to measure their sustainability performance. STARS is intended to engage and recognize the full spectrum of colleges and universities - from community colleges to research universities - and encompasses long-term sustainability goals for already high-achieving institutions as well as entry points of recognition for institutions that are taking first steps toward sustainability.
     
  • The Intentional Endowments Network (IEN)
    IEN is a broad-based, collaborative peer-learning network advancing intentionally designed endowments that enhance financial performance and are aligned with institutional mission, values, and sustainability goals. IEN supports learning on a variety of sustainable investing strategies, such as ESG integration, impact investing, and shareholder engagement, that will make a significant and critical contribution to creating a healthy,just, and sustainable society.
     
  • We Are Still In
    Mayors, governors, and business leaders first began signing the We Are Still In declaration in June 2017 as a promise to world leaders that Americans would not retreat from the global pact to reduce emissions and stem the causes of climate change. The bipartisan coalition has since doubled in size, expanding to include over 3,600 representatives from all 50 states, spanning large and small businesses, mayors and governors, university presidents, faith leaders, tribal leaders, cultural institutions and investors.