Board of Regents to form sub-committee on socially responsible investment

DivestMTA presented a report at Mount Allison Students’ Union council on Feb. 1, citing their concern with the ethics of the university’s investment strategies. The report is entitled “The Case for Socially Responsible Investment [SRI] Policy at Mount Allison University.” Students Alex Lepianka and Naomi Goldberg of DivestMTA presented their plans and recommendations for this report. A vote on a motion at the next council meeting will decide if the MASU will formally endorse the report, recognizing the need for procedure and policy for evaluating socially responsible investment.

Lepianka presented the first portion of the report, explaining the context of its creation. Lepianka said DivestMTA presented the investment committee of the Board of Regents (BoR) with a report concerning the ethics of the university’s investment strategies. On Aug. 14, the investment committee recommended against the use of non-financial criteria for investment decisions as this would include environmental, social and governance (ESG) factors. Lepianka said it was found that the terms of reference indicated that the investment committee is not empowered to evaluate on non-financial criteria for investment. The investment committee terms of reference specify that the committee is to solely evaluate the risk and return of investments.

The issue of SRIs was then moved under purview of the BoR nominating and governance committee, as it was determined that it was a governance issue rather than an investment issue, and was therefore outside the scope of the investment committee. This was a problem because the nominating and governance committee does not have membership from faculty, students or staff but is rather “independent people making governance decisions about the university,” said Lepianka.

“There is a governance problem in addition to other ethical investing problems,” said Lepianka. “This report is trying to answer the fact that nowhere is there any sort of committee or procedure for properly evaluating matters of socially responsible investment.”

Second-year student Naomi Goldberg presented DivestMTA’s recommendations, all of which are common to SRI policies at other Canadian and American universities. DivestMTA recommends that the BoR create a committee to establish a SRI policy. This committee would then advise the BoR on all SRI-related matters.

“In the interest of transparency, [DivestMTA] would like the committee to have members of the student body, faculty and administration, and hopefully an equal number of each,” said Goldberg.

The report also suggests that Mt. A become a signatory of the United Nations’ six principles of responsible investment. These principles include: incorporating ESG issues into investment analysis and decision-making processes; being active owners and incorporating ESG issues into ownership policies and practices; seeking appropriate disclosure on ESG issues by the entities in which the university invests; promoting acceptance and implementation of the principles within the investment industry; working to enhance the effectiveness in implementing the principles; and reporting on activities and progress towards implementing the principles.

Goldberg said endowment information should be made public to the committee. DivestMTA cited a Bauder College case study in Atlanta, G.A. Bauder College did not allow their committee access to their endowment information, which rendered the committee ineffective.

The report’s final recommendation said Mt. A should establish a criterion for special action, which should be guided by both Yale and McGill Universities’ concepts of social injury, both of which cite the effects of climate change and which include the deaths and displacement of peoples. This recommendation says the university should have a policy in place for dealing with cases of problematic investments, should they appear.

On Feb, 12, following the first of three annual BoR meetings, a decision was made to create an advisory committee on SRI issues. MASU President Dylan Wooley-Berry told the crowd of students, “One decision was made: A subcommittee is going to be implemented that has students and faculty sitting on it, talking about the idea of creating a socially responsible investment [policy].”

Willa McCaffrey-Noviss, the MASU’s BoR representative, said the sub-committee is being created under the nominating and governance committee, which will consider where SRI fits within the BoR. McCaffrey-Noviss said she will be included on this subcommittee.

Naomi Goldberg is an Argosy Staff member.

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