| Overall Rating | Gold |
|---|---|
| Overall Score | 75.88 |
| Liaison | Deborah Steinberg |
| Submission Date | Dec. 17, 2024 |
Carnegie Mellon University
PA-10: Sustainable Investment
| Status | Score | Responsible Party |
|---|---|---|
|
1.36 / 5.00 |
Charles
Kennedy Chief Investment Officer Investment Office |
Part 1. Positive sustainability investment
Value of holdings in each of the following categories:
| Value of holdings | |
| Sustainable industries (e.g., renewable energy or sustainable forestry) | 0 US/Canadian $ |
| Businesses selected for exemplary sustainability performance (e.g., using criteria specified in a sustainable investment policy) | 45,800,000 US/Canadian $ |
| Sustainability investment funds (e.g., a renewable energy or impact investment fund) | 5,600,000 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 $ |
If any of the above is greater than zero, provide:
Businesses selected for exemplary sustainability performance: As part of CMU's manager selection process, managers' application of ESG factors in investment process is analyzed and weighed. CMU increasingly is allocating to managers that have implemented formal ESG policies or ESG frameworks to apply to investment decision-making and value creation opportunities. As a result, select underlying investments reflect exemplary sustainability performance.
Sustainability investment funds: CMU invests in environmentally-focused funds that manage natural forests, deploy modern farming techniques in agribusiness, and/or invest in green technology development and implementation. For example, select timber strategies are dedicated to carbon sequestration, ecological resilience, and sustainable timber harvesting. CMU's partners in this area are committed to third-party certification standards, such as Sustainable Forestry Initiative (SFI) and Forest Stewardship Council (FSC).
Percentage of the institution's investment pool in positive sustainability investments:
Part 2. Investor engagement
Sustainable investment policy
CMU Investment Office’s written ESG policy is integrated into investment process for all investment decisions rather than applied as a distinct strategy or layered on top to "check a box." The language that guides sustainable investments is: "Environmental, social, and governance (“ESG”) issues can affect the performance of investment portfolios (to varying degrees across companies, sectors, regions, regulatory regimes, asset classes, and through time). Attention to ESG issues by investors and company management teams encourages accountability, transparency, sustainability, and ethical behavior in business practices, which may lead to reduced exposure to various risks and improved long-term value creation. Thus, in analyzing investment opportunities for the [investment portfolio], ESG factors appropriately may be one of the inputs considered in assessing financial return potential."
A brief description of how the sustainable investment policy is applied:
As detailed in the sustainable investment policy, ESG factors are one of many inputs considered in assessing the risk and financial return potential of an investment. As part of the investment approval process, each investment memorandum includes a dedicated ESG section detailing any risks or merits of a potential manager’s ESG policy or ESG track record.
The university does not pursue ESG investing as a strategy distinct from its central investing focus. Carnegie Mellon integrates ESG factors into its multifaceted investment analyses and we expect our investment managers to do the same. Monitoring our managers’ incorporation of ESG initiatives into their value creation strategies gives us insight into their ability to persistently increase value in their operating companies, which benefits us all.
Proxy voting
With the majority of CMU’s invested assets in commingled vehicles, CMU has very few directly-held investments. However, CMU has developed internal proxy voting guidelines and votes accordingly for directly held positions and requests and reviews proxy voting disclosures and corporate engagement guidelines for commingled investment vehicles to identify any areas to address that are inconsistent with CMU’s investment policy, including sustainability questions. The size and reputation of CMU’s managers often enable them to be leaders in promoting sustainability through corporate engagement.
Shareholder resolutions
Examples of how the institution has engaged with corporations in its portfolio about sustainability issues during the previous three years:
Divestment efforts and negative screens
A brief description of the divestment effort or negative screens and how they have been implemented:
Approximate percentage of endowment that the divestment effort and/or negative screens apply to:
Investor networks
CMU Investment Office staff communicate regularly with peer institutions to share ESG best practices.
Optional Fields
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.