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INVESTING/PORTFOLIO STRATEGIES

University of Oxford reaffirms climate-change policies for endowment investing

Coal

University of Oxford, Oxford, England, will continue to avoid direct investments in coal and oil sands companies within its endowment funds, and will strengthen the level of engagement and public reporting on carbon emissions and climate change.

The announcement by Oxford University Endowment Management, which runs £2 billion ($3.1 billion) of endowment funds on behalf of 28 collegiate university investors, followed a review by the university council. That review was triggered by a call from the Oxford University Student Union to consider fossil-fuel divestment.

In a statement on its website, the university said its council concluded robust mechanisms are already in place to ensure that environmental factors are taken into consideration when making investment decisions. The endowment fund currently has no direct investments in coal and oil sands companies.

The council has asked the endowment office to continue to avoid direct investments in such companies, and also to avoid investment in sectors with high social and environmental risks. The management company is also required to continue to include a range of other energy investments. The council's investment committee — which sets the endowment’s investment policy — will report annually on voting decisions and engagement with money managers across all sectors.

The management company is also required to continue to improve its reporting and communication of its investment strategy. It will begin to publish a full breakdown of its sector exposures, including energy, in its annual report and on its website.

“We see the main purpose of our investment fund as generating the financial resources to support our academic purpose,” said professor Andrew Hamilton, vice chancellor of the university, in the statement. “However, our investment managers take a long-term view and take into account global risks, including climate change, when considering what investments to make. The university believes that approach to be the right one and today’s decision reinforces it by encouraging greater engagement and reporting on this crucial issue to the environment and all of society.”