Mt. A’s most recent investment report lists holdings in Russian firms

While some large universities have pledged to divest from their Russian assets amid its illegal invasion of Ukraine, Mt. A has made no comment about whether they plan to follow suit

            On February 24, Russia invaded the sovereign state of Ukraine following an address by Russian President Vladimir Putin announcing a “special military operation” in the country, confirming fears of a conflict that had been mounting for weeks.

            Sanctions and public denouncements of Russia’s actions both pre-empted the invasion and have continued as the nation has been accused of numerous war crimes, including the air striking of hospitals and the murder of civilians.

            On March 4, Mt. A released a statement in which it lauded Ukrainian resistance and condemned Russia’s aggression as “an attack on democracy.”

            Other institutions have gone further, pledging to separate themselves from Russia not only in their rhetoric but in their finances.

            March 3 saw a release by the University of Colorado announcing both its solidarity with Ukraine and its intention to back out of its investments in Russian business. CU President Todd Saliman is quoted in the announcement: “We are looking for ways to show our support for the people of Ukraine and believe that cutting our investments is the right thing to do.”

            The Arizona Board of Regents, which governs the state’s three public universities, made a similar pledge on March 7. In a release on the Arizona Board of Regents website, the organization announced that Arizona State University, Northern Arizona University, and the University of Arizona will “exit any investments in Russian assets as quickly as possible.”

            Mt. A has made no such commitment, despite the fact that its most recent report on endowment fund holdings, published on December 31, 2020, lists numerous sizable investments in Russian firms.

            According to the report, the University held over $59,000 worth of assets in a large Russian food retailer known as Magnit, more than $85,000 in a Russian gold firm called Polyus, and over $60,000 in Rosneft, a Russian energy giant whose CEO has personally been the target of numerous sanctions.

            When asked to confirm whether the University currently held these assets, Director of Finance-Controller, Guylaine Roy, quoted the school’s financial advisors, saying: “At the moment I can’t comment on the specific holdings below as of December 31, 2021 because we are still in the process of validating the Q4 data.”

            Mt. A did not respond to a request for information made under the Right to Information and Protection of Privacy Act (RTIPPA), but the school’s Media Relations Officer, Laura Dillman, provided The Argosy with a statement from President Boudreau and Robert Inglis, the school’s VP, Finance and Administration.

            “Most of Mount Allison’s investment funds do not own Russian companies because the funds do not invest in any companies, but rather other types of investments…” wrote Dillman.  “At this time the University has not changed its investment approach or considered changes to our investment policy due to the events in Ukraine. We know investment managers are monitoring the situation and we remain engaged with them.”

            Dillman did not respond to a request for clarification on the extent to which this minority of investment funds is tied to Russian business.

            Some of those employed by the financial sector are foreseeing long-lasting negative consequences to the value and feasibility of investing in Russia.

            Jon Spinney is the Chief Investment Officer at Vestcor, a Fredericton-based firm that handles investment management, pensions, and employee benefits. Spinney wrote to The Argosy a personal prognosis for Russia’s place in the market.

            “In addition to the current inability to trade these markets due to sanctions and trading halts, MSCI and FTSE—global providers of Indexes that are widely used by investors—have removed Russia from their broad market benchmarks that track global Emerging Markets.”

            “While Russia was not a large destination for most investors previously, this has effectively removed the country from consideration in most global portfolios going forward,” explained Spinney. “As to when/if Russia may regain its former status, that remains too uncertain to tell at this time, but would likely only happen after a considerable period of time.”

            Spinney observed that the wake of Russia’s invasion of Ukraine has touched the global market.

            “Since the February 24 ‘special military operation’, market volatility has been about double what is normal and investors had to deal with a significant move lower in global stock prices from mid-February to mid-March, before the more recent recovery,” wrote Spinney.

            Carl Xu, a Net Investment Analyst at Moncton-based Louisbourg Investments, gave a personal opinion to The Argosy about investor confidence in Russian firms. Xu noted that investing is a trust-based system, and that Russia’s actions have damaged investors’ confidence.

            “When you just look at a surface level, the government is inherently unstable and the chance of another event like this occurring – in peoples’ minds the probability has gone up.”

Leave a Reply

Your email address will not be published. Required fields are marked *

Related Articles