Presbyterian Foundation Adopts Five-Point Approach to Address Climate Change Through Its Investments
January 30, 2018 by Presbyterian Foundation
Believing that its investments can both do good and do well, the Presbyterian Foundation has adopted a five-point approach to address climate change through its investments:
- Investments Targeting Environmental Solutions – The Foundation committed at least 1 percent of its permanent endowment fund holdings (approximately $7 million) will be invested in companies working on climate change solutions. The first two clean energy investments have been selected, and investment in two to three additional clean energy managers is expected soon.
- Securities Selection Process – The Foundation directed its investment managers to consider environmental, social, and governance (ESG) factors in their security selection process. The request adds an extra layer of research about what a company is doing today that impacts the world in the future. It helps ensure that funds entrusted to the Foundation are responsibly invested to support mission.
- Dialogue with Energy Companies – In the past two years, the Presbyterian Foundation has engaged in dialogues with more than 50 companies, and filed or co-filed shareholder resolutions with 18 companies. The Foundation believes that climate risk means financial risk, and therefore has also engaged financial managers to discuss how they review and vote for shareholder proposals on climate change. The organization has committed to continue engaging corporations to address environmental concerns and climate change.
- Loans to Encourage Energy Efficiency – The Foundation is helping to provide low-interest loans to congregations for renewable energy and carbon reduction solutions. Since the summer of 2015, 47 congregations have used loans totaling more than $8 million—funds that are going directly to helping churches become more energy efficient. Projects range from replacement of HVAC systems to full remodels.
- Fossil-free Investment Solutions – The Foundation offers a custom fossil-free investment strategy to churches and individuals who seek a “divestment” option. First Presbyterian Church of Tallahassee, Florida, was the first to move their entire endowment fund into the fossil-free investment strategy.
The Presbyterian Church (U.S.A.) is among hundreds of denominations, universities, private endowments and other institutional investors studying how their investments can best be leveraged to mitigate the negative effects of climate change and care for the environment.
The Presbyterian Foundation, with $1.8 billion in assets under management, gathers, stewards and distributes funds for mission. A vital part of the Presbyterian Church (U.S.A.), the Foundation strengthens congregations and related mission and ministry efforts by developing gifts and managing funds on their behalf. We work with them to build communities of generosity among their members and constituents. And we provide all Presbyterians an avenue to realize their philanthropic goals through a variety of giving options. In all our work, we remain focused on the Reformed values that have guided our stewardship and investment for more than 200 years.