Bates College
PA-10: Sustainable Investment
| Status | Score | Responsible Party |
|---|---|---|
|
2.26 / 3.00 |
Tom
Twist Sustainability Manager Facilities |
Total value of the investment pool:
Value of holdings in each of the following categories:
| Value of holdings | |
| Sustainable industries (e.g., renewable energy or sustainable forestry) | 30,587,000 US/Canadian $ |
| Businesses selected for exemplary sustainability performance (e.g., using criteria specified in a sustainable investment policy) | 38,129,000 US/Canadian $ |
| Sustainability investment funds (e.g., a renewable energy or impact investment fund) | 36,872,000 US/Canadian $ |
| Community development financial institutions (CDFIs) or the equivalent | 0 US/Canadian $ |
| Socially responsible mutual funds with positive screens (or the equivalent) | 0 US/Canadian $ |
| Green revolving funds funded from the endowment | 0 US/Canadian $ |
A brief description of the companies, funds, and/or institutions referenced above:
From our fund managers, Hall Capital Partners (HCP) on Methodology
Sustainable industries (e.g., renewable energy or sustainable forestry)
- We looked through the portfolio of any fund likely to invest in companies in “sustainable industries” and added up the current value of all relevant companies (using the latest available data, either 3/31 or 6/30)
- The definition of “sustainable industries” includes ESG analysis as a process requirement and is conducted for every potential investment decision
Businesses selected for exemplary sustainability performance (e.g., using criteria specified in a sustainable investment policy)
- Given the lack of sustainability ratings in the private markets, we focused this analysis on the public equities portion of the balance sheet
- Within that scope, we identified any companies that CATS’ public equities managers own with a Sustainalytics risk score of “Low” (indicating strong performance on sustainability factors), and calculated the aggregate exposure to those companies
- We relied on Sustainalytics given it is recognized as a market leader in the sustainability ratings space, and we believe their ratings are founded on rigorous analysis
Sustainability investment funds (e.g., a renewable energy or impact investment fund)
- Any fund with an explicit mandate to (i) target sustainable companies/investments (e.g. Climate Adaptive), (ii) integrate sustainability considerations into the investment process to a rigorous degree (e.g. Generation Asia), or exclude investments in fossil fuels and related industries (e.g. Farallon F5)
Total endowment value (can be rough estimate): $419M as of 6/30/2022
Values (if any) of investments in:
Sustainable industries (e.g., renewable energy or sustainable forestry): 7.3%
Businesses selected for exemplary sustainability performance (e.g., using criteria specified in a sustainable investment policy): 9.1%
Sustainability investment funds (e.g., a renewable energy or impact investment fund): 8.8%
Community development financial institutions (CDFIs) or the equivalent: Not applicable to the endowment
Socially responsible mutual funds with positive screens (or the equivalent): Not applicable to the endowment
Green revolving funds funded from the endowment: Not applicable to the endowment
Percentage of the institution's investment pool in positive sustainability investments:
Does the institution have a publicly available sustainable investment policy?:
A copy of the sustainable investment policy:
The sustainable investment policy:
Investment
Bates believes that incorporating the long-term risks of climate change into
the fundamental work of managing the endowment leads to stronger and
more durable investment results. Consistent with the college’s principled
and pragmatic approach to sustainability efforts on campus, Bates has
similarly considered environmental principles when investing the college’s
endowment.
Since 2015, the college has halved its investment in traditional fossil
fuel-based energy companies from more than six percent to three percent
of the endowment, following a steady plan to reduce exposure over time.
We have achieved this through a number of actions, including liquidating
our public energy-focused funds, allowing our private energy partnerships
to wind down, electing to transition alternative investments into a
fossil-fuel-free share class, and screening our bond portfolio to eliminate
oil, gas and coal holdings.
Going forward, Bates has formalized efforts aimed to further reduce
endowment holdings in fossil fuel related companies. Specifically, Bates will:
• Instruct managers of separately managed equity accounts to sell all stocks
of fossil fuel companies, such as oil, gas, and coal, and to refrain from
purchasing these types of securities in the future.
• Elect “fossil fuel-free” share classes of alternative investments whenever
available.
• No longer commit to new investments in private fossil fuel extraction,
exploration, and production funds. The college’s last commitment in this
area was made in early 2017, and the college’s involvement with these
investments will end as they wind down.
• Actively seek to add renewable resource-focused investments (wind, solar,
and other green-specific investments) to the endowment.
We believe these actions are consistent with the college’s efforts to
incorporate environmental implications into our behaviors and activities on
campus. Furthermore, we believe these actions reflect our commitment to
act globally and responsibly to combat the climate crisis.
- from Sustainability 2030 Roadmap
Does the institution use its sustainable investment policy to select and guide investment managers?:
A brief description of how the sustainable investment policy is applied:
Bates uses our Sustainability Roadmap (see above) to inform and guide our endowment managers, Hall Capital Partners.
Has the institution engaged in proxy voting, either by its CIR or other committee or through the use of guidelines, to promote sustainability during the previous three years?:
A copy of the proxy voting guidelines or proxy record:
A brief description of how managers are adhering to proxy voting guidelines:
In the past year, our investment committee, and the larger body of the board of directors voted to adopt the endowment investment guidelines in our sustainability roadmap, which set forth guidance to 1) instruct managers of separately managed equity accounts to sell all stocks
of fossil fuel companies, such as oil, gas, and coal, and to refrain from
purchasing these types of securities in the future; 2)elect “fossil fuel-free” share classes of alternative investments whenever
available; and no longer commit to new investments in private fossil fuel extraction,
exploration, and production funds. The college’s last commitment in this
area was made in early 2017, and the college’s involvement with these
investments will end as they wind down. Also to actively seek to add renewable resource-focused investments (wind, solar,
and other green-specific investments) to the endowment.
Has the institution filed or co-filed one or more shareholder resolutions that address sustainability or submitted one or more letters about social or environmental responsibility to a company in which it holds investments during the previous three years?:
Examples of how the institution has engaged with corporations in its portfolio about sustainability issues during the previous three years:
Hall Capital Partners (HCP) works closely with the endowment’s underlying managers, not directly with portfolio companies.
Does the institution participate in a public divestment effort and/or have a publicly available investment policy with negative screens?:
A brief description of the divestment effort or negative screens and how they have been implemented:
• Instruct managers of separately managed equity accounts to sell all stocks
of fossil fuel companies, such as oil, gas, and coal, and to refrain from
purchasing these types of securities in the future.
• Elect “fossil fuel-free” share classes of alternative investments whenever
available.
• No longer commit to new investments in private fossil fuel extraction,
exploration, and production funds. The college’s last commitment in this
area was made in early 2017, and the college’s involvement with these
investments will end as they wind down.
• Actively seek to add renewable resource-focused investments (wind, solar,
and other green-specific investments) to the endowment.
We believe these actions are consistent with the college’s efforts to
incorporate environmental implications into our behaviors and activities on
campus. Furthermore, we believe these actions reflect our commitment to
act globally and responsibly to combat the climate crisis.
- from Sustainability 2030 Roadmap
Approximate percentage of endowment that the divestment effort and/or negative screens apply to:
Does the institution engage in policy advocacy by participating in investor networks and/or engage in inter-organizational collaborations to share best practices?:
A brief description of the investor networks and/or collaborations:
Hall Capital Partners (HCP), OCIO, participates in investor networks, inter-organizational collaborations and is a signatory to UNPRI. HCP has a team dedicated to ESG investing (called Full Consequence Investing). Using the FCI framework, HCP considers every investment’s risk and opportunity while also factoring in corporate governance and environmental and social factors. HCP works closely with our fund managers, and also engages with the broader ecosystem through our work with partner organizations and our involvement in industry convenings. Our 2022 Impact Report is attached and please let us know if you have any questions.
Website URL where information about the institution’s sustainable investment efforts is available:
Additional documentation to support the submission:
Data source(s) and notes about the submission:
The information presented here is self-reported. While AASHE staff review portions of all STARS reports and institutions are welcome to seek additional forms of review, the data in STARS reports are not verified by AASHE. If you believe any of this information is erroneous or inconsistent with credit criteria, please review the process for inquiring about the information reported by an institution or simply email your inquiry to stars@aashe.org.