Santa Clara University
PA-10: Sustainable Investment

Businesses selected for exemplary sustainability performance: Global stock and bond strategies that incorporate ESG best practices into their underwriting of company business models and underwriting.

Sustainability investment funds: Dedicated strategy that invests in California carbon credits, a nascent market that prices the externalities of carbon emissions.

CDFI: An agriculture company that seeks to improve crop yields in third world countries and pass along agricultural best practice to local farming communities.

Socially responsible mutual funds: A global resources fund that invests behind the energy transition. Fund invests both in traditional energy sources with ESG best practices along with renewable energy (i.e. biodiesel).

The Socially Responsible Investing guidelines are provided by staff to the Fund investment managers, who are requested to invest according to these principles. It is recognized that the implementation of these guidelines may not be possible in certain asset classes that are important to the Fund’s investment strategy. These cases typically involve partnerships, mutual funds, or commingled funds which do not allow for social screening.

Sustainable investments, as with all investments under consideration, must meet suitable risk-adjusted hurdles before being considered for investment. An example is an investment that was made in a non-US agricultural startup company that brings the latest sustainable farming technology to various regions around the world, helping improve crop efficiency (yields), while lifting thousands out of poverty, and is expected to generate a suitable risk-adjusted return for shareholders.

Several of our funds have a dedicated sustainability officer responsible for considering environmental, public health, safety, and social issues associated with target companies when evaluating whether to invest in a particular company. This structure allows the funds to help their underlying investments (companies) through appropriate governance structures, to improve and grow in the area of long-term sustainability performance, which ultimately benefits multiple stakeholders, including environmental, social and governance issues.

Santa Clara University’s investment policy does include negative screens, but it is not publicly available. It is available at the Investment Office at the request of various University stakeholders

Guided by the values associated with its mission, Santa Clara University invests its resources in institutions that are, at one and the same time, consistent with the "prudent person" principle, capable of generating a rate of return consistent with the University's Investment Policies statement, and socially responsible in their policies and practices. Socially responsible investments should positively contribute to the common good and be guided by traditional Catholic ethical considerations. Balancing the consistent-life ethical principles and the "prudent person" principle will require judgment on the part of the Investment Office, the Investment Committee, and each money manager.

General guiding principles for investing are as follows: avoid companies whose primary products are directly destructive of human life; avoid companies involved with governments involved in gross human rights abuses; avoid companies that consistently practice racial, ethnic, religious, or gender discrimination; avoid companies whose primary business is nuclear weapons research, production, deployment, and servicing; and avoid companies who have been repeatedly cited for gross ecological violations.