University of California, San Diego
PA-9: Sustainable Investment

In 2017 the endowment made a $35 million commitment to Congruent Ventures, a new energy seed-stage venture capital fund. a clean tech investment firm seeded with capital from the investment office and which sources investment opportunities from throughout the UC system. The fund is also invested in Pattern Energy, a renewable power company. In 2017 the endowment also made a $70 million investment in TPG Rise Impact Fund, TPG's impact investment fund. Additionally, the investment office has liquidated its high-yield bond holdings of of Dakota Access Pipeline (DAPL) operating companies ETP and SUNOCO. In 2015 the office sold its holdings in the world's largest coal mining firms and firms that generate profits from Canadian oil sands mining. In 2015 the University of California because the first and largest founder of the Aligned Intermediary, which helps long-term investors identify investable climate infrastructure projects in clean energy, water infrastructure and waste-to-value. That same year, the UC became the first and only institutional investor that is a signatory to the Bill Gates Breakthrough Energy Coalition to accelerate clean energy solutions. We also work to partner with family offices and other investors, sourcing ideas from our national labs and agricultural centers.

http://www.ucop.edu/investment-office/sustainable-investment/sustainability-framework/index.html We are in process of furthering our stewardship practices.

We approach sustainability both from a risk management and investment opportunity perspective. We believe that sustainability can help us increase our risk-adjusted returns over the long term by helping us manage long horizon risks. As part of the overall due diligence process and ongoing assessment every investment manager is reviewed and scored against the UC's sustainability framework. In 2017 the endowment made a $35 million commitment to Congruent Ventures, a new energy seed-stage venture capital fund. a clean tech investment firm seeded with capital from the investment office and which sources investment opportunities from throughout the UC system. The fund is also invested in Pattern Energy, a renewable power company. In 2017 the endowment also made a $70 million investment in TPG Rise Impact Fund, TPG's impact investment fund. Additionally, the investment office has liquidated its high-yield bond holdings of of Dakota Access Pipeline (DAPL) operating companies ETP and SUNOCO. In 2015 the office sold its holdings in the world's largest coal mining firms and firms that generate profits from Canadian oil sands mining. In 2015 the University of California because the first and largest founder of the Aligned Intermediary, which helps long-term investors identify investable climate infrastructure projects in clean energy, water infrastructure and waste-to-value. That same year, the UC became the first and only institutional investor that is a signatory to the Bill Gates Breakthrough Energy Coalition to accelerate clean energy solutions. We also work to partner with family offices and other investors, sourcing ideas from our national labs and agricultural centers.

The investment office votes its proxies in accordance with ISS ESG guidelines.

The investment office has worked with outside groups such as Ceres and the 30 Percent Coalition on shareholder engagements. We have also partnered with other investment managers to engage with companies over key issues, such as diversity, and will from time to time engage in direct dialogs with companies on our own as and when we deem appropriate to do so. In 2016, for example, the UC was a co-filler on a resolution by Exxon Mobile shareholders, requesting that the company publish a two-degree scenario analysis. Although originally defeated a similar resolution was successful in 2017. This past February the company published its first such analysis. The investment office has since engaged in a dialog with the company about its report. We are currently involved in a joint share holder engagement effort with the California State Teachers Retirement System concerning board diversity.

The Office of the Chief Investment officer applies a handful of negative screens to its investments. These include: companies doing business in the Sudan, companies that derive a significant amount of their revenue from thermal coal or oil sands, tobacco companies, and business which operate private prisons. We also screen for fire arms manufactures. Regent Policy 6301: POLICY TO EXCLUDE SECURITIES OF COMPANIES MANUFACTURING TOBACCO PRODUCTS FROM INDEX FUNDS AND TO CONTINUE EXISTING EXCLUSION FROM ACTIVELY MANAGED FUNDS http://regents.universityofcalifornia.edu/policies/6301.html Regents Policy 6302: POLICY ON DIVESTMENT OF UNIVERSITY HOLDINGS IN COMPANIES WITH BUSINESS OPERATIONS IN SUDAN http://regents.universityofcalifornia.edu/policies/6302.html

UC is an active member of: Ceres 30 Percent Coalition Principles for Responsible Investment (PRI) Coalition for Private Investment in Conservation (CIPC) Task Force on Carbon Related Financial Disclosure (TCFD) The Farm Animal Investment Risk and Return (FAIRR) Investors & Indigenous Peoples Working Group Enlightened Endowment Initiative United Nations Global Compact Participant: Breakthrough Energy Coalition Participant: US Aligned Intermediary

The UC San Diego Foundation has approximately 70% of its endowment invested in the General Endowment Pool of the UC Regents. We cannot pull out yet information specific to UCSD holdings.