University News

Investment office offers $70k grant to SRIF

Additional funding to allow student investment group to ‘invest more actively,’ increase risk

By
Senior Staff Writer
Thursday, March 12, 2015

SRIF, which now has $100,000 in funding, pursues sustainable investments through endorsing socially and environmentally responsible companies.

While many students must monitor only their personal savings accounts, members of the Brown Socially Responsible Investment Fund are now responsible for managing $100,000. The Investment Office granted SRIF an additional $70,000 last week, Jane Dietze, managing director of the office, wrote in an email to The Herald.

The allocation, championed by President Christina Paxson P’19, marks an effort to equalize the funding provided to all investment groups on campus, she wrote.

SRIF is a student group that makes investment decisions after evaluating companies on two fronts: environmental, social and governance responsibility, as well as financial success. Companies must meet both criteria in order for the group to invest, group leaders said. The group currently holds investments across 19 companies.

The administration previously provided two separate student investment groups $50,000, and the two groups later combined to form the Brown Investment Group with a total of $100,000 in funds, Dietze wrote. SRIF was originally granted $30,000 in 2009, so the administration allocated another $70,000 from the University’s operating funds to give the fund equal access to $100,000, Dietze added.

The decision came after the administration reviewed SRIF’s performance and noted that it had been “a good steward of the funds and had continued to vigorously pursue its educational mission,” Dietze wrote.

“SRIF is an empowering and unique place where people from vastly different academic backgrounds can come together and have the same conversations,” said Sophie Purdom ’16, SRIF co-president.

SRIF members are excited about the additional $70,000, which will allow the group to “invest more actively” and “take some riskier stances,” Purdom said.

One problem the group faced prior to the increase in funding was the “pressure over us to (sell positions) to liquidate funds in order to remain productive,” said Nicole Shimer ’16, the other SRIF co-president and former Herald general manager. “In order to buy more companies we would have to first sell them, which led to us selling companies before we necessarily wanted to,” she added.

The administration’s decision to increase SRIF’s funding is “making a statement that Brown stands for socially responsible investing,” Purdom said. “While this won’t happen overnight because the endowment is heavier to turn than SRIF, there are promising conversations happening within the administration,” she added.

Sustainable investing is important not only from a moral perspective, but also from a financial outlook, Shimer said. “Socially responsible companies are more efficient and have strong leadership teams and care about their employees, which translates into strong financial gains because the company runs well,” she said.  Additionally, consumers are looking to support socially responsible companies, she added.

Currently, the group is examining the possibility of investing more in each of its 19 holdings. While the precedent has been to invest $2,000 in each new position, with the new funds, SRIF is looking into investing $2,500 or $3,000 per company to increase its ability to engage in shareholder advocacy. In order to leverage companies for either environmental, social, governance or financial reasons, investors must hold at least $2,000 in shares and have been invested for at least one year.

SRIF is considering restructuring its board to include a shareholder advocacy chair, who would engage with companies by writing them letters with social advocacy suggestions. The group is also looking to add an education chair to maintain its commitment to educating its members.

Going forward, SRIF may partner with the Investment Office as the office aims to build a more socially responsible fund under its own auspices by creating a fossil free portion of the endowment. The group plans to help the Investment Office establish a more qualitative and quantitative framework for assessing the environmental, social and governance aspects of companies, Shimer and Purdom said.

Next week, the group will vote on whether to invest in Unilever and Time Warner Cable Inc., both of which they see as long-term value investments.