Sustainable & Responsible Investments Report

Fiscal Year 2021

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


Portfolio Update

$3.8b

Value of the Amherst College endowment for the fiscal year ending June 30, 2021

100%

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

30

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

0

The portfolio has no direct holdings in coal companies


Cash 5%; Real Estate 0.2%; Natural Res 4%; Pub Eq 31%; Private Eq 46%; Absolute Return 11%; Fixed Income 3%

Cash Equivalents 5%; Real Estate 0.2%; Natural Resources 4%; Public Equity 31%; Private Equity 46%; Absolute Return 11%; Fixed Income 3%.

Existing Manager Engagement

Amherst currently partners with 36 active investment managers, spanning a range of asset classes. The Office of Investments and Investment Committee are committed to meaningfully engaging with our managers. The College continues to have thoughtful dialogue with its managers around the issue of sustainability.

The Office of Investments is also deeply committed to incorporating the College’s values around diversity, equity, and inclusion in the management of the endowment. In 2021, the Office of Investments instituted a process to engage with its partners on their DEI efforts and initiatives, aiming to increase the diversity, equity, and inclusiveness of the office, portfolio, and investment world.


Sustainable & Responsible Investment Efforts

  • This year, the College formally instructed all managers of our separately managed accounts to not acquire or hold on its behalf direct investments in fossil fuel companies and committed to phasing out the remaining investments in long-term fossil fuel funds.

  • The College engages prospective investment managers in dialogue during the due diligence process to understand their approach and commitment to integrating ESG and DEI considerations into their investment process. Amherst looks to invest with managers who thoughtfully and consistently incorporate ESG factors into their investment diligence and process.

  • The College consistently evaluates and votes shareholder proxies in alignment with ESG principles, advocating for corporate accountability with respect to social, ethical, environmental and governance issues.


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 FY 2021, the College voted a total of 30 proxies for directly held stocks within the portfolio.

Chart as described in notes below

Voting Categories: Shareholder Rights and Defenses 8%; Auditor Related 23%; Board of Directors Related 27%; Capital/Corporate Structure 3%; Compensation Issues 29%; Political Contributions/Lobbying 3%; Labor/Human Rights/Consumer 5%; Climate Change/Environment 2%.
Chart as described in notes below
ESG Issues: Labor/Human Rights/Consumer 54%; Political Contributions/Lobbying 31%; Climate Change/Environment 15%.

Of these, 15 proxies included various shareholder proposals for a wide range of issues, including reporting on lobbying payments and political spending, reporting on employment diversity, and revising and adopting human rights policies.

There were 13 shareholder proposals specific to ESG issues, all of which the College voted in favor of.

In FY21, ISS provided new company QualityScores, evaluating each’s environmental and social risk through the analysis of company disclosures. Of the 30 companies the College voted proxies for, 67% had Environment and Social Quality Scores of 3 or greater (on a 1-10 scale, with 1 being the highest rating given).

See the Amherst College Investment Office website for additional information.


Memberships & Other Engagement

Name

Purpose

Participation

EIRIS

(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

IADEI

An open organization of institutional allocators (largely endowments & foundations) working to address the issues of diversity, equity, and inclusion in their respective offices and portfolios, and in the investment industry at large.

Participant since 2021