2014-2015 Annual Report

 

YORK UNIVERSITY

ADVISORY COMMMITTEE ON RESPONSIBLE INVESTING

2014-2015 Annual Report

for the

Vice-President Finance & Administration

June 2015

 

Introduction


York University is an institution dedicated to higher learning and founded on values of accessibility, social responsibility and excellence. Building on this foundation, the University seeks to be a leader in sustainability and engagement.

York University is committed to values of sustainability and responsible investing in the management of its investment portfolios of global holding. As such, the Board of Governors has incorporated a high-level statement of investment philosophy into its Statement of Investment Policy and Procedures (The Policy) that establishes the underpinnings for the University’s investment strategy. The investment philosophy incorporates the principle that investing in companies that adopt sustainable practices aligns the university’s portfolios with long-term investment objectives that are suitable to the endowment fund. In order to operationalize this philosophy, the investment strategy would suggest incorporating the concept of integrating environmental, social and governance (ESG) factors into the investment selection and investment decision-making process.

In the Fall of 2013, the University established the York University Advisory Committee on Responsible Investment to further expand its ESG factors into the management of its investments through the establishment of the Advisory Committee on Responsible Investment.

Annual Report Requirements


This is the annual report from the Committee Chair to the Vice-President Finance & Administration as per the Terms of Reference for the York University Advisory Committee on Responsible Investment. This report provides information to the Vice-President Finance & Administration on the activities of the Committee for the year ended June 30, 2015.

The Terms of Reference state that:

“The Chair of the committee shall produce an Annual Report in August of each year for the preceding year, which shall be submitted to the Vice-President Finance and Administration, who will be invited to comment on it.”

Purpose of the Advisory Committee


The Committee will provide a forum for interested parties at the University to discuss and express opinions on responsible investing.

The Advisory Committee will be composed of students, faculty and staff that meet for the purposes of investigating, producing and providing advice to the University that is constructive and feasible, and an enhancement to the responsible investing process.

Under the Terms of Reference, the scope of the Committee’s work includes:

  • Advice about investments where investment managers can actively engage;
  • Identification of companies that may be involved in activities contrary to the University’s principles and beliefs, where active engagement by York’s investment managers would be warranted;
  • Advice about circumstances in which stocks held by the University may cause social or environmental injury;
  • Advice on proxy voting guidelines, including areas in which the University should invoke proxy voting;
  • Identification of like-minded organizations, shareholder groups or coalitions, with which the University could potentially affiliate or become a member.

Composition of the Advisory Committee


The Advisory Committee is comprised of nine (9) members as per the Terms of Reference. The following individuals were appointed or named to the Committee:

Faculty Members

  • Prof. Irene Henriques, Sustainability & Economics, Schulich School of Business (Chair) Prof.
  • Walter Whiteley, Mathematics & Statistics, Faculty of Science
  • Prof. Anna Zalik, Faculty of Environmental Studies

Non-Academic Staff Member

  • James Pratt, Research Officer, School of the Arts, Media, Performance and Design

Student Members (named by their respective constituencies)

  • Yasar Bukan, York University Graduate Students’ Association (to December 31, 2015)
  • Lucas McCann, representative of the York University Graduate Students’ Association (from January 1, 2015)
  • Mithilen Mathipalan, representative of the York Federation of Students
  • Aysha Syed, PSC Student Subcommittee (to January 28, 2015)
  • Manisha Joshi-Vijayan, PSC Student SubCommittee (from May 26, 2015)

The other members of the YUACRI include:

  • Trudy Pound-Curtis, Assistant Vice-President Finance and Chief Financial Officer
  • Laurie Lawson, University Treasurer

Report of Activities 2014-2015


For the year ended June 30, 2015, the full Advisory Committee met on four separate occasions to undertake its work. An engagement subcommittee met on three separate occasions to draft a process for responsible investment representations from York University community.

The Committee started a process of research and education to assist the Committee in exercising their responsibilities under the Terms of Reference. Unfortunately, due to the labour dispute, a second educational panel looking at various investment perspectives had to be cancelled. This panel will be re-scheduled for the Fall of 2015.

Attendance Record Advisory Committee Meetings


YUACRI-Chart

Activities completed to date include:

  1. Held an education panel:

Responsible Investment and the York Endowment Fund: Share Value or Shared Values?

Panelists:

  • Dr. Tessa Hebb, Director Carleton Centre for Community Innovation, Carleton University
  • Dr. Priti Shokeen, Senior Associate, MSCI ESG Research
  • Dr. Irene Henriques, Chair York University Advisory Committee on Responsible Investing and Professor of Sustainability & Economics, Schulich School of Business, York University.

Tessa Hebb, Director Carleton Centre for Community Innovation, Carleton University, Ottawa, Canada

Dr. Hebb is the Director of the Carleton Centre for Community Innovation, Carleton University, Canada.   Her research focuses on Responsible Investment and Impact Investment is funded by the Social Sciences and Humanities Research Council, Government of Canada. The Carleton Centre for Community Innovation is a leading knowledge producer on these topics together with non-profit and philanthropic leadership, northern communities and community economic development. Dr. Hebb received her Doctorate from Oxford University.

Dr. Hebb is the chair of the steering committee of the UN- backed PRI Academic Network. She also serves on the boards of the Heartland Network, Canadian Business Ethics Research Network, the Responsible Investment Association and the Impact Investing Policy Collaborative. She led a four year research project on US Public Sector Pension Fund Investment in Urban Revitalization based at Harvard University and funded by the Ford and Rockefeller Foundations (2004-2008). She is a frequent guest speaker on responsible investment issues in both Canada and the US. She has published many books and articles on responsible investing and impact investing policies including the volumes Working Capital: the Power of Labor’s Pensions; No Small Change: Pension Fund Corporate Engagement; The Next Generation of Responsible Investing; and SRI in the 21st Century: Does it make a Difference to Society.

Dr. Priti Shokeen, Senior Associate, MSCI ESG Research

Dr. Shokeen is a Toronto-based Senior Associate with MSCI ESG Research focused on the transportation industry and Canadian companies. Prior to joining MSCI, she managed consulting projects and research for the extractive sector at Innovest Strategic Value Advisors. Dr. Shokeen has worked for the Federation of Indian Chambers of Commerce in Delhi, India and the International Labor Organization in Geneva, Switzerland. She also has experience auditing working conditions in India’s garment factories and, as part of her team’s advocacy projects, worked on ground to create HIV/AIDS prevention and treatment awareness among target groups.

Dr. Shokeen has a Doctorate in Accounting and Finance from Kingston Business School, UK. Her thesis focused on integration of responsible investment among Canadian pension funds. She has published reports on comparative study of UK and Canadian pension fund transparency regulations and practices(National Roundtable for the Economy and Environment, Government of Canada), Human Capital based Investment Criteria (EU Lisbon Strategy Project, FEEM, Milan), and Potential of Responsible Investing in Asian Pension Systems(University of Toronto, Canada).

Dr. Irene Henriques, Chair York University Advisory Committee on Responsible Investing and Professor of Sustainability & Economics, Schulich School of Business, York University

Dr. Henriques is a Professor of Sustainability and Economics at the Schulich School of Business, York University in Toronto Canada and the Chair of the York University Advisory Committee on Responsible Investing. Her research interests span economics, stakeholder management and sustainability. She has published numerous articles in leading economic and management journals. She is a member of the IRIS Executive Committee, York University. From 2001 to 2005, she was a member of an OECD working group on firm level environmental management and environmental policy. In 2008-2009, she was Chair of the Organizations and the Natural Environment (ONE) Division of the Academy of Management. In 2005, she was appointed by the Canadian Minister of the Environment for a three year term to the Joint Public Advisory Committee (JPAC) to the US, Canadian and Mexican Environment Ministers under NAFTA (the Commission for Environmental Cooperation) and in 2007 was elected Chair of JPAC. She received her PhD in economics from Queen’s University and her Bachelor’s and Master’s of Science degrees from the Université de Montréal. Irene is fluent in four languages (English, French, Portuguese and Spanish).

  1. Developed a process for community engagement (See Appendix A)
  1. Undertook research on “Best Practices” at Universities (ESG policies, proxy votingguidelines, coalition engagement, ESG screening)
  1. Developed the YUACRI website http://yuacri.info.yorku.ca/

Activities planned for 2015-16


The Committee identified a number of activities to be included in their work plan for 2015-2016. The activities include:

  1. Development of proxy voting guidelines
  2. Review ESG practices of each Endowment Investment Manager
  3. Further development of the YUACRI website
  4. Development of a communication plan to advertise community engagement process
  5. Renewal of YUACRI membership on committee
  6. Develop an assessment procedure to deal with proposals on social responsibility with respect to the University’s endowment investments
  7. Organize two panels – a panel entitled: “Responsible Investing: A Multi-Perspective Discussion” that was postponed due to the labour disruption and another on stakeholder engagement.

 

Appendix A


Process for Responsible Investment Representations for the York University Endowment Fund from York University Community

In order to provide the York University community with an opportunity to make representations on social responsibility with respect to the University’s endowment investments, we have established the following process.

Proposals from York University Stakeholders

Proposals must be initiated by members of the York University community. For the purposes of this statement, we have identified five separate constituencies - faculty, staff, students, retirees, and alumni.

The submission must be accompanied by a petition of at least 300 individual signatures (hard copy and/or electronic), with a minimum of 15 signatures from each of at least 3 constituencies that self-identify as faculty, staff, student, retiree or alumni.

Submission

  1. Any qualified Responsible Investment proposal/submission regarding the York University Endowment Fund will require a documented submission identifying the social and/or environmental injury that should influence investment decisions.
  2. A robust case for the proposed action including:

(i) A social, political, economic or environmental rationale that is clearly stated and supported by evidence ;

(ii) Reasonable evidence that the proposed action is an effective way to achieve the desired outcome;

(iii) Illustration that the request is consistent with the University’s principles and beliefs (http://about.yorku.ca/our-mission/ ) and other community relationships or a further argument to align other University academic activities with the request;

(iv) A clearly laid out rationale as to why this policy is superior to alternative approaches aiming to address the identified social and/or environmental injury.

Electronic submissions are encouraged and accepted. The submission along with the requisite signatures and University affiliation should be sent to the attention of the York University Advisory Committee on Responsible Investing (c/o Judy Horwood) yuacri@yorku.ca

Investment Holdings

Members of the York community can obtain a currently available list of the investment holdings of the Endowment Fund at http://YUACRI.info.york.ca/endowmentfund

Role of York University Advisory Committee on Responsible Investing (YUACRI)

Under the Terms of Reference, the scope of the YUACRI’s work includes:

  • Advice about investments where investment managers can actively engage;
  • Identification of companies that may be involved in activities contrary to the University’s principles and beliefs, where active engagement by York’s investment managers would be warranted;
  • Advice about circumstances in which stocks held by the University may cause social or environmental injury;
  • Advice on proxy voting guidelines, including areas in which the University should invoke proxy voting;
  • Identification of like-minded organizations, shareholder groups or coalitions, with which the University could potentially affiliate or become a member.

The York University Advisory Committee will review submissions and make a recommendation to the Vice President Finance and Administration on what further action, if any, should be taken. The decision to make recommendation is expected to be made within 4 months. Actions may include (but are not limited to):

  1. No action with explanation
  2. Shareholder engagement activities which may include some of the following actions:

(i) letters to management

(ii) supporting shareholder resolutions

(iii) voting of proxies or amending proxy voting guidelines

(iv) joining coalitions

(v) divestiture of existing holdings

(vi) applying investment screens (positive or negative)