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Harvard University Endowment

PRI reporting framework 2016

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You are in Strategy and Governance » Implementation not in other modules

Implementation not in other modules

SG 11. ESG issues in strategic asset allocation (Not Completed)


SG 12. Long term investment risks and opportunity (Private)


SG 13. Allocation of assets to environmental and social themed areas (Private)


SG 14. ESG issues for internally managed assets not reported in framework

14.1. Describe how you address ESG issues for internally managed assets for which a specific PRI asset class module has yet to be developed or for which you are not required to report because your assets are below the minimum threshold.

Asset Class

Describe what processes are in place and the outputs or outcomes achieved

Forestry

HMC makes direct investments in timberland with the goal of improving their environmental and social management.  When assessing forestry-related ESG risk, HMC reviews country risk reports and obtains tailored information on each country, including analysis of rule of law.  HMC requires its timberland to come into compliance with and be certified to the Forest Stewardship Council's (“FSC”) standard.  The FSC is a leading global social and environmental certification standard for forestry.  The standard was developed through  a multi-stakeholder process and is subject to multi-stakeholder governance.  FSC requires members to undergo independent audits to obtain FSC certification.  HMC also carries out on-site ESG due diligence for higher risk forestry investments.  Additionally, in summer 2015, HMC developed impact metrics by adapting EIRIS’s accounting metrics to HMC’s timberland investments.

Farmland

HMC invests directly in farmland.  HMC reviews country risk reports and obtains tailored information by country, including analysis of rule of law, when assessing social and environmental risk related to its farmland investments.  HMC requires its farmland investments to pursue relevant certifications that require high environmental and social performance.  For example, HMC expects its farmland investments to work towards and meet certification standards such as Global G.A.P. and Sustainability in Practice (“SIP”).  Global G.A.P. is a non-governmental organization that sets certification standards for sustainable agriculture.  Third parties conduct the certification.  SIP is a sustainable certification standard for vineyards.  In addition to its certification requirements, HMC conducts other activities to enhance the sustainability of its farmland.  For example, HMC carries out on-site environmental and social due diligence for higher risk investments.  Additionally, in summer 2015, HMC developed impact metrics by adapting EIRIS’s accounting metrics to HMC’s farmland investments.

14.2. Additional information [Optional].


SG 15. ESG issues for externally managed assets not reported in framework

15.1. Describe how you address ESG issues for externally managed assets for which a specific PRI asset class module has yet to be developed or for which you are not required to report because your assets are below the minimum threshold.

Asset Class

Describe what processes are in place and the outputs or outcomes achieved

Hedge funds

HMC applies its due diligence framework to its hedge fund investments.  This includes reviewing the ESG policies and governance of its potential hedge fund investments; identifying how the fund integrates ESG factors into its investment decisions; asking how the fund communicates ESG information to limited partners; and ascertaining whether the fund is a PRI signatory.

Forestry

Nearly all of HMC's forestry assets are managed internally, with HMC retaining the right to make buy/sell decisions. 

Farmland

Nearly all of HMC's farmland assets are managed internally, with HMC retaining the right to make all buy/sell decisions.  In one instance, HMC holds externally managed farmland through a limited partnership interest in a commingled fund.  HMC reviews periodic reporting provided by the general partner to determine how the fund integrates ESG factors into its investment decisions.

15.2. Additional information.


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