College Endowment: Responsible Investment and Disinvestment of Fossil Fuels
As an investor in the University’s endowment fund and a partner in the collegiate University, Magdalene College welcomes the University’s decision to embark on a plan to decarbonise its investments. Further details are available at Cambridge to divest from fossil fuels with 'net zero' plan.
The College has been active for some years in developing an investment approach which is both responsible and sustainable for its own endowment which is invested to generate long term financial returns in order to support its charitable objectives:
- To deliver a world-class undergraduate education;
- To encourage applications from the most talented students irrespective of social, ethnic or religious background; and
- To promote academic research of the highest quality.
The College believes that it is possible to invest responsibly in line with our charitable objectives and yet meet our long term real return objectives and invests with the UN’s Global Compact principles in mind. Detailed information can be found at United Nations Global Compact - The Ten Principles of the UN Global Compact and the principles are re-produced below.
The endowment consists of assets in directly owned property, principally based in Cambridge, and financial assets invested globally. Our principal fund manager for its securities is Baillie Gifford and the College, together with an Oxford College, in 2018 actively sought to take part in setting up to a new responsible equity fund as a seed investor. This fund excludes companies which derive significant [>10% of revenues] revenues from:
- Production or sale oil and gas
- Tar sands and thermal coal
- Gambling and adult entertainment
- Production and sale of Tobacco
- Production or sale of alcohol
- Production or sale of armaments
The fund only invests in companies consistent with principles under the UN Global Compact and actively engages with businesses to improve their policies and activities.
The majority of the financial assets are invested in this responsible equity fund and the College’s Investment Committee is actively working with its fund manager to jointly develop a further multi-asset responsible fund for other financial assets.
The College is a long term investor with the University’s endowment fund and has a small holding in the Charities Property Fund. The responsible investment policy is available at Charities Property Fund - Environmental, Social & Governance.
The UN Global Compact Principles
Principle 1: Businesses should support and respect the protection of internationally proclaimed human rights; and
Principle 2: make sure that they are not complicit in human rights abuses.
Principle 3: Businesses should uphold the freedom of association and the effective recognition of the right to collective bargaining;
Principle 4: the elimination of all forms of forced and compulsory labour;
Principle 5: the effective abolition of child labour; and
Principle 6: the elimination of discrimination in respect of employment and occupation.
Principle 7: Businesses should support a precautionary approach to environmental challenges;
Principle 8: undertake initiatives to promote greater environmental responsibility; and
Principle 9: encourage the development and diffusion of environmentally friendly technologies.
Principle 10: Businesses should work against corruption in all its forms, including extortion and bribery.