Northwestern University has announced new climate change-related investment guidelines that will limit investments in fossil fuel-related companies and support further investments in clean energy technology.
The Evanston, Ill.-based university announced the new policy for its $14.9 billion endowment in a June 23 news release posted on its website.
According to the news release, the university's board of trustees has directed Northwestern's investment office to divest as possible from direct public or private investments in companies "identified as pursuing poor practices with respect to greenhouse gas emissions, energy production or climate change information and research."
The board also directed the investment office to adopt a system of compiling the endowment's carbon footprint and engage with external managers to reduce that footprint with the eventual goal of a net-zero carbon emission status, limit future direct energy investments to companies that produce fuels with lower levels of greenhouse gas, seek out investments in companies that create or promote low-carbon technology and promote energy efficiency while still ensuring strong investment returns.
"The board considered the potential unintended consequences that could result from indiscriminate policies that target energy supply without addressing demand," said J. Landis Martin, chairman of the board, in the news release. "These include concerns about the sharply higher costs of energy and electricity, which disproportionately impact people with lower incomes and by extension exacerbate inequality. The board believes its guidelines will help address climate change without causing undue harm to vulnerable populations."
The investment office is required to provide an annual report on the progress of the guidelines.
Amy Falls, the university's vice president and chief investment officer, said in an email, "We are in the process of implementing new disclosures as per the guidelines but don't have anything ready to share at this point."
