Divestment
In April 2018, the University embarked on a new endowment strategy
As of January 2020 we are pleased to state that, as part of our Climate Strategy, we have directly divested from fossil fuels in the management of our endowed funds.
Our endowment strategy, managed by Goldman Sachs, is as follows:
Avoid
We have directly divested from all fossil fuels. This specific climate-related screen complements the broader ethical screen meaning that the University also doesn’t have direct investments in tobacco, gaming, pornography and armaments.
Mitigate
A full environmental analysis is done when selecting bonds and equities to ensure that we have detailed knowledge of the exposure and approach of the company to environmental issues, using data from experts such as MSCI and Sustainalytics. Furthermore, when selecting mutual funds, we specifically invest in managers who specialise in incorporating environmental, social and governance (ESG) factors into their investment process.
Adapt
As an investor, the University can engage with the companies it owns within its endowment portfolio to encourage them to adapt their business models to the low carbon economy. The University is actively engaging with companies across the world and using your shareholder votes to force action on climate change. For example, Goldman Sachs voted over 108,000 times in 2019 and supported shareholder proposals asking for companies to publish a two-degree scenario report 100% of the time.
Positive Impact
The University has allocated 11% of the portfolio (half of the private asset allocation) to impact investing. This is invested in businesses which have a direct, measurable social and environmental return alongside a financial return. The impact investing portfolio is diversified across eight themes and investment areas, five of which are focused on climate: sustainable agriculture, sustainable transport, waste & materials, ecosystem services and clean energy.
The combination of these four focal areas means that the University has one of the leading climate investment strategies in the UK Higher Education sector.
Read the University of Leicester's financial regulations (PDF, 1.41mb)