University of California Board of Regents, Oakland, voted Thursday to establish and integrate a framework for sustainable investing, said spokeswoman Dianne Klein.
The regents approved a proposal from a university task force that calls for $1 billion of university endowment and retirement assets to be invested in solutions-oriented investments such as renewable power and fuels, energy efficiency and/or sustainable food and agriculture. Environmental, social and governance factors also will be integrated into the university’s investment decisions.
The task force was formed June 16 after a coalition of student groups had pushed for the university to enact a ban on fossil-fuel investments. The approved framework does not call for divestment; it does not rule it out either.
Separately, the board of regents approved the establishment of UC Ventures, a stand-alone venture capital investment vehicle with an initial commitment of $250 million.
The initial commitment will be made from UC’s $8.3 billion endowment. The university has a $91 billion portfolio made up of retirement, endowment and cash assets.
The venture, which is expected to launch in 2015, will seek to generate attractive, risk-adjusted returns by investing in commercial opportunities arising from University of California research. UC Ventures staff would handle day-to-day responsibilities. UC’s chief investment office will hold certain key governance rights and help UC Ventures develop in-house expertise.
Earlier this week Ms. Klein told Pensions & Investments that if the item passed, UC Ventures would accept outside institutional investors as well.
