Boston University
PA-9: Sustainable Investment

The University invests the majority of its assets with third-party investment managers in funds or other collective investment vehicles. Significant commitments to these funds have yet to be called and invested by the underlying investment managers. In addition to the investments of the endowment, the Investment Office staff were located in the University’s first geothermal building, and in the Summer of 2012 moved to a newly renovated building that is certified LEED Gold by the US Green Building Council. The University has made investments through external investment managers actively involved in the development of "clean" technologies, alternative energy sources, energy efficiency, emissions controls/reductions, sustainable forestry/farming techniques, and other environmentally responsible investments. In recognition of the growing importance of incorporating ESG principles into investment processes, BU has evidenced that some of its external investment managers have implemented one or more of the following, (1) adopted the Six Principles of the PRI (Principles for Responsible Investment), (2) developed formal ESG policies and (3) are developing or have developed ESG integration teams within and across their portfolio management organizations. The University will continue to evaluate similar investment ideas as part of the ongoing management of the endowment portfolio.

Meeting on April 13, 2016, the ACSRI proposed the following recommendation to the Board of Trustees: "To signal the importance of, and the University's commitment to, the global effort to reduce the human carbon footprint, the Univesity should, within its endowment, prohibit new and divest of any existing direct investments in those companies that (a) continue to explore for new fossil fuel reserves of any kind since the global fossil fuel reserves are estimated to be larger than the amount that can be used and still remain under the accepted estimated warming limit of 2 degrees Celsius or (b) extract coal and tar sands, the most carbon-intensive fuels, until, in the University's judgement, those companies curtail such activities to drive their carbon footprint to acceptable levels. This proposal must be undertaken in concert with the requirement to meet the University's fiduciary duties to its endowment." The Board of Trustees responded: "1) That the University commit, on a best efforts basis, to avoid investing in coal and tar sands extractors; perfect implementation cannot be assured, however, given the University's inability to have total investment control due to the endowment' s extensive use of (a) commingled investment vehicles for which the investment manager has complete investment authority and (b) passive index-linked investments. 2) That the Investment Committee be asked to report to the Board of Trustees at least annually on its experience with the above commitment. 3) That the Board revisit this issue every five years, or more often, as economic, climatic, technological, and other developments may warrant." The Board further agreed with the ACSRI's proposal that the effort "must be undertaken with the requirement to meet the University's fiduciary duties to its endowment" In January 2015, the Board of Trustees developed and publicly communicated principles which will guide it in its considerations of divestment proposals. The full text of these principles can be found here. http://www.bu.edu/trustees/boardoftrustees/committees/acsri/principles-for-board-decision-making-on-divestment-requests/ Meeting on May 9, 2006, the Board of Trustees decided that: The Trustees of Boston University (the "University") divest any and all direct investments in multinational companies (i) identified as having direct business ties to the Sudanese government, or (ii) whose business activities are in direct support of these companies and the activities of the government. Although the University does not currently have direct investments in such companies, this action will preclude future direct investment in these companies. The University, through the Investment Committee, will also communicate its decision to its external investment managers in the hope that they will take into consideration the University's actions and the situation in Sudan as these managers develop and implement their own investment strategies. As a result of this action, the companies identified on the attached Schedule A (which shall be reviewed and updated periodically by the Investment Committee) are currently banned for direct investment. The foregoing principles and criteria will be applied to investment in companies doing business in other countries whose governments commit genocide or other serious human rights violations.