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Harvard University Endowment

PRI reporting framework 2016

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Responsible investment policy

SG 01. RI policy and coverage

01.1. Indicate if you have an investment policy that covers your responsible investment approach.

01.2. Indicate the components/types and coverage of your policy.

Select all that apply

Policy components/types

Coverage by AUM

          Investment due diligence framework
        

01.3. Indicate what norms have you used to develop your RI policy.

01.4. Provide a brief description of the key elements of your investment policy that covers your responsible investment approach [Optional].

HMC's Sustainable Investment Policy ("SIP") is pending final approval.  The SIP includes all asset classes under management.  It specifies environmental and social risk factors that, if material, HMC will consider when investing.  The SIP identifies roles and responsibilities and articulates HMC's approach to sustainable investment.  The SIP includes HMC's due diligence process; commitment to sustainability certification for its forestry and agricultural investments; approach to active ownership; intent to collaborate with other responsible investors; and commitment to reporting on its activities.

01.5. Additional information [Optional].

Other policies and procedures complement the SIP and provide a holistic framework for HMC's approach to responsible investment.   For example, the Advisory Committee on Shareholder Responsibility ("ACSR"), which advises the Corporation Committee on Shareholder Responsibility ("CCSR"), developed Proxy Voting Guidelines which help inform its recommendations with regard to voting on select environmental and social issues for which the committees' body of precedent provides a clear indication of a voting preference. HMC finalized a Proxy Voting Policy, which pertains to voting on governance issues. On the rare occasions when the CCSR has instructed HMC to divest from securities, the CCSR has issued a public statement describing its rationale for doing so. Although HMC's approach to responsible investment will be further detailed in the SIP when it is finalized, much of HMC's policy and strategy is already available online, including regarding due diligence and engagement.


SG 02. Publicly available RI policy or guidance documents

02.1. Indicate which of your investment policy documents (if any) are publicly available. Provide URL and an attachment of the document.

02.2. Additional information [Optional].

Although HMC's SIP is not yet publicly available, the public can view our approach to responsible investment at this url: http://www.hmc.harvard.edu/investment-management/sustainable_investment.html.

 


SG 03. Conflicts of interest

03.1. Indicate if your organisation has a policy on managing potential conflicts of interest in the investment process.

03.2. Describe your policy on managing potential conflicts of interest in the investment process.

HMC’s Code of Conduct requires that HMC employees act at all times in a manner consistent with their fiduciary responsibilities to HMC and exercise care that no detriment results from conflicts of interest.  An employee is considered to have a conflict of interest when the individual either: (i) has an existing or potential financial or other interest which impairs or might impair the individual’s independence of judgment in the discharge of responsibilities; or (ii) may receive a material financial or other benefit from knowledge of information confidential to HMC.

HMC’s Conflict Policy for Directors establishes guidelines for resolving potential conflicts between the interests of HMC and those of non-employee Directors.  The Policy follows three general principles: (i) HMC Directors should ensure that Harvard University receives all appropriate investment opportunities; (ii) Director involvement in a potential conflict requires advance approval by disinterested Directors; and (iii) conflicts must be reported to the HMC Board and the Harvard University Corporation.  Each HMC Director is responsible for reporting any real or potential conflict of interest promptly to HMC’s Chief Compliance Officer ("CCO").   This information is reported to the HMC Board on a quarterly basis.

 

03.3. Additional information. [Optional]


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