San Francisco State University
IN-24: Innovation A

In the spring of 2013, the San Francisco State University Foundation committed “to limit direct investments in companies with significant production or use of coal and tar sands.” (SF State Foundation, 2013) As part of the divestment commitment, the Foundation agreed to estimate the carbon footprint of the foundation’s equity portfolio with the intention of reducing climate-related risk of its investments. The carbon footprint was calculated for equities in the portfolio since equities represent ownership of the underlying company. Fixed income investments and other alternative investments were not considered. Scope 1,2, and 3 emissions were included in the calculation wherever available. For companies that did not report Scope 3 figures, the sum of Scope 1 and 2 emissions was used as total company emissions. For companies which did not have emissions data on Bloomberg, emissions were estimated using industry averages. These averages were computed using a sample set consisting of stocks from selected indices and from within the portfolio. The methodology involved three key phases: (1) gathering the required data from various data sources, (2) calculating the portfolio footprint for companies that publicly report emissions and (3) estimating the portfolio footprint for companies which do not publicly report emissions. SF State hopes this model becomes a model for using carbon impact as a decision factor in making new investments. SF State's Foundation Board members have presented this methodology at industry conferences with the hopes of spreading the practice throughout the investment community.

Had help with collecting data from Tanvi Pradhan and Amie Lewis