Sustainable & Responsible Investment Report

Fiscal Year 2015

The Amherst College Office of Investment and Investment Committee are committed to a dynamic and ongoing process of inquiry, analysis and engagement with Amherst’s investment partners around environmental considerations.


Portfolio Update

$2.19b

Value of the endowment for the fiscal year ending June 30, 2015

100%

Percentage of the College’s managers with whom the Investment Office has engaged about sustainability

52

Proxies voted in alignment with environmental, social, and governance (ESG) principles

0

The portfolio has no direct holdings in coal companies


Existing Manager Engagement

Investment pie chart: Natural Resources 8%; Public Equity 40%; Private Equity 21%; Absolute Return 24%; Fixed Income 2%; Cash 3%; Real Estate 2%.

Amherst partners with 73 sustaining investment managers, spanning a range of asset classes. The Office of Investment and Investment Committee are committed to engaging with our managers. Earlier this year, the College reached out to each of its investment managers, asking how they incorporate the financial impact of climate change when evaluating investments. Roughly a third shared written materials on how they incorporate environmental considerations into their investment decision-making process. Although, the majority of managers have verbally indicated that they take these risks into consideration in evaluating prospective investments.


Sustainable & Responsible Investment Efforts

  • The College continues to proactively evaluate and vote shareholder proxies in alignment with ESG principles, advocating for corporate accountability with respect to social, ethical, environmental and governance issues.
  • To further our engagement with other higher education, as well as investment organizations, we’ve partnered with Ceres, a non-profit organization advocating for sustainability leadership, through membership in its Investor Network on Climate Risk (INCR). As part of our involvement with the INCR, the College has supported two letter writing initiatives: one to the finance ministers of the Group of Seven in support of a long-term global emissions reduction goal and one in support of the White House’s proposal to reduce methane emissions from the oil and gas industry by at least 45% below 2012 levels by 2025.
  • The College engages prospective investment managers in dialogue during the due diligence process to understand their approach and commitment to integrating ESG considerations into their investment process.  Amherst looks to invest with managers who thoughtfully and consistently incorporate ESG factors into their investment diligence and process.

Proxy Voting

The College continues to use the voting rights attached to the shares of companies in which it invests to promote the principles of sustainable and responsible investment, utilizing research from ISS for all proxies before casting votes in alignment with these principles. In Fiscal Year 2015, The College voted a total of 52 proxies for directly held stocks within the portfolio.

Voting Categories pie chart: Shareholder Rights and Defenses 6%; Auditor Related 22%; Board of Directors Related 31%; Capital/Corportate Structure 5%; ESG Issues 6%; Compensation Issues 30%.
ESG Issues pie chart: Climate Change/Environment 7%; Labor/Human Rights/Consumer 21%; Political Contributions/Lobbying 72%.

Of these, 27 proxies included shareholder proposals for a wide range of issues, including proxy access, reporting on lobbying payments, independent board chairs and reporting on practices to mitigate palm oil sourcing. There were 14 shareholder proposals specific to ESG issues, all of which the College voted in favor of.

Pointer See a complete list of votes cast.


Memberships & Other Engagement

Name

Purpose

Participation

ERIS

(Conflict Risk Network)

A network of institutional investors, financial service providers and related stakeholders calling on corporations to fulfill their responsibility to respect human rights and  to take steps that support peace and stability in areas affected by genocide and mass atrocities. 

Member since 2009

Investor Network on Climate Risk (INCR)

Ceres’ INCR provides a forum for investors to share information, intelligence, experiences and strategies on integrating climate and other ESG factors into investment decision making.

Member since 2015

ISS

ISS researches and provides recommendations for proxy voting in alignment with social and responsible investment principles.

Partner since 2007