Advisory committee on investment responsibility established

EVANSTON - The Investment Committee of Northwestern University’s Board of Trustees at its meeting Friday endorsed the establishment of an Advisory Committee on Investment Responsibility. 

The new advisory committee, established by President Morton Schapiro and Will McLean, vice president and chief investment officer, will consider issues regarding Northwestern’s investment activities, conduct research and monitor trends on those issues, and make recommendations to the Trustee Investment Committee.

“This new advisory committee will provide a forum for thoughtful discussion of concerns that are raised by the campus community regarding the University’s investment policies and also provide an established mechanism for bringing those concerns to the trustees,” McLean said.

The new committee also will make recommendations on how Northwestern should vote on social responsibility measures that appear on companies’ annual shareholder elections. The elections, commonly termed proxy voting, offer an opportunity for shareholders to voice their opinions on issues regarding the environment, governance and social issues that are placed on the companies’ election ballots by shareholders.

In general, Northwestern does not hold individual stocks or other financial instruments itself, but works with a number of external management firms that invest the University’s funds in a variety of ways.

Composition of the Committee

The committee will include 10 voting members ratified by the president. The members will be:

• Two members of the faculty, to be nominated by the Faculty Senate in consultation with the provost
• Two undergraduate students, to be nominated by the Associated Student Government in consultation with the vice president for student affairs
• Two graduate students, to be nominated by the Graduate Leadership Advisory Council in consultation with the dean of The Graduate School
• Two alumni, to be nominated by the Northwestern Alumni Association in consultation with the vice president for alumni relations and development
• Two members of the Northwestern staff, to be nominated by the Northwestern University Staff Advisory Council (NUSAC) in consultation with the vice president for human resources

The chair of the advisory committee, who will serve for one year, will be appointed by the president from among the voting members.

The establishment of the advisory committee follows Northwestern’s adoption last fall of the United Nations-supported Principles for Responsible Investment, joining Harvard and UC Berkeley as the only universities to do so.

The U.N.-supported Principles for Responsible Investment is an international network that broadly addresses the importance of environmental, social and corporate governance (ESG) issues for investors to consider when making investment choices.

McLean, student leaders and members of the Board of Trustees Investment Committee have been working on the framework for the new advisory committee since earlier this year. The advisory committee is modeled on similar committees at Columbia, Duke, Penn, Harvard and Yale, McLean said.

“There have been a number of good discussions on the makeup and roles of the committee, but I think we’ve reached consensus that this will be a good starting point,” McLean said. “Credit goes to the leadership of the students, faculty and staff, the trustees and the president for getting us here.”