Fall 2014

Students Push for Green Investments

Humboldt State University’s charitable foundation recently adopted an expansive new policy on socially and environmentally responsible investing, and through its “Humboldt Investment Pledge” is urging other foundations to do more to clean up their investments.

The HSU Advancement Foundation’s Board unanimously adopted the policy in late April.

The Foundation already had a longstanding practice of making socially responsible, direct investments while closely monitoring the impact of indirect investments. For over a decade, for example, it has operated without any direct investments in fossil fuel-related industries, making it a leader in the more recent fossil fuel divestment movement.

But, intent on doing even better, the Board adopted the stricter policy following extensive meetings with students and others.

“We could have recommended the status quo, continuing our investment practices that are already more socially responsible than most other institutions. But that isn’t enough for this Board, our students, or our community,” said Duncan Robins, a Board member on the Finance Committee who helped lead the development of the new policy and pledge.

“We want to prove that it is possible, even for a relatively small endowment like ours, to do even better,” Robins said. “We won’t be perfect, but we will try to set a positive example for others to follow.”

The policy was inspired by the university’s Graduation Pledge of Social and Environmental Responsibility, which was created by students almost three decades ago and is now used at nearly 100 universities worldwide.

Robins said the student voices and energy on the issue were vital. A student group first approached the Board about divesting from fossil fuels last fall, and since that time has continued to meet with the Board’s Finance Committee to work on details.

The Board was inspired by the students’ understanding of the issues and commitment to making a difference.

As discussions progressed, a policy emerged that focused on much more than a small number of oil companies. It became a policy to discourage investment in all companies either directly or indirectly involved with extracting and using fossil fuel, and one aimed at challenging the Foundation to take more proactive steps going forward. The Foundation was concerned with the social impact of many more companies in its mutual fund portfolios—nearly 10 percent as opposed to less than 1 percent under a more typical measure of social responsibility.

“The policy provides a great framework to make investment decisions and it’s a huge step forward from what I’ve seen of previous socially responsible investment policies,” said Eric Recchia (’13, Economics), an HSU alumnus involved in the effort.

The policy lays out a 10-point pledge with broad goals that will guide future investment activity.

The Humboldt State University Advancement Foundation will:

  1. Define socially or environmentally concerning sectors in a broad, bold way so as to include: a) Energy—extraction, distribution, refining and marketing (i.e. oil, natural gas, coal and related/supporting industries); b) Utilities—electricity generation (i.e., utilities utilizing carbon-based fuels); c) Aerospace/defense, alcohol, tobacco, gaming and casino industries. Revisit definition and revise as appropriate over time.
  2. Continue to abstain from any direct investment in concerning sectors.
  3. Monitor and report on the value of indirect investments in concerning sectors.
  4. Make reasonable attempts to reduce the size of indirect investments in concerning sectors provided any divestments are consistent with the Foundation’s fiduciary requirements.
  5. Define socially or environmentally responsible (SER) organizations, projects or assets initially as ones which: a) Are environmentally friendly (i.e. reduce the levels of atmospheric C02) or; b) Improve the health and well-being of community members. Revisit definition and revise as appropriate over time.
  6. Actively seek offsetting investment opportunities in SER organizations, projects or assets.
  7. Invest directly in SER organizations, projects or assets provided that: a) Investments meet the Foundation’s fiduciary requirements and policies b) Investments support the stated HSU mission, vision and values.
  8. Monitor and report on the value of direct investments in SER assets and active investments in SER organizations or projects.
  9. Monitor and report on the value of obvious indirect investments in SER organizations, projects or assets.
  10. Create a SEROP Fund (with appropriate policies) and actively seek donations of funds and assets that could be used to support Humboldt’s SEROP Pledge.