The University of Birmingham is committed to maintaining high environmental, social and governance (ESG) standards across its investment portfolios. The University’s cash and cash equivalents and investment holdings totalled £346m as at 30 April 2024, a combined total of the cash and cash equivalents holdings £207m and the Long-Term Fund £139m.
Responsible Investment
The University and its external investment managers are signatories to the United Nations Principles for Responsible Investment (UNPRI), which defines responsible investment as a strategy and practice to incorporate ESG factors in investment decisions and active ownership.
Since 2019, the University has transitioned its investment assets into ethical and sustainable investment funds. These funds heavily restrict or exclude investments in companies deriving revenue from the following areas: carbon and fossil fuels, defence and weapons, alcohol, tobacco, gambling, adult entertainment and high-interest lending. The University’s indirect investment in fossil fuel related companies represents less than 0.5% of the University’s investment assets as at 30 April 2024. The current indirect investment in fossil fuel related companies is less than £1m.
The University has agreed to proactively pursue ethical investment fund options, where suitable investment vehicles are available, and where investment returns would be consistent with the University’s charitable objectives.
The University has also published a Responsible Investment Policy on the University’s website.
Responsible Investment Policy - University of Birmingham
The Policy defines the commitment of the University to responsible investment. Its purpose is to detail the approach that the University aims to follow in integrating environmental, social and governance (‘ESG’) issues in its investments and the Policy applies to the full scope of the investments held by the University. The Policy is also intended to be entirely consistent with the University’s duty to yield the best financial return within the level of risk considered to be acceptable by the University.
The Responsible Investment Policy details three sets of principles which accord with the University’s values as a socially responsible institution. Firstly, the stewardship of the operations of its external fund managers, secondly environmental, social and governance (ESG) integration into its investment operations and governance practices and thirdly setting appropriate standards for all its investments through exclusions criteria that the University’s external investment managers are required to take into consideration when investing the University’s funds.
The Responsible Investment Policy is reviewed annually in collaboration with the University Sustainability Steering Group, which includes representatives from across the University, including student representation. The Group provides strategic advice to the University Executive Board to develop and deliver a sustainability plan covering education and research locally, nationally and internationally as well as for a green campus. The University’s Strategic Planning & Resources Committee (SPRC) is responsible for final approval of the Responsible Investment Policy.
Portfolios
The University is cash generative and funds may be held within short, medium and long term funds depending on when they are required.
The University invests endowments in longer-term funds. This incorporates the following types of endowments:
- Unrestricted permanent endowments – the donor has specified that the fund is to be permanently invested and generate an income stream for the general benefit of the University;
- Restricted expendable endowments – the donor has specified a particular objective other than fixed assets and the University has the power to use capital over the medium term;
- Restricted permanent endowments – the donor has specified that the fund is to be permanently invested to generate an income stream to be applied to a particular objective.
University of Birmingham Investment Funds’ Asset Allocation as at 30 April 2024
The University’s Outsourced Chief Investment Officer (OCIO), JP Morgan, oversees the investment funds of the University, working to agreed investment mandates. The University also invests in private market funds with separate investment mandates. In developing these mandates the University sets a fundamental guiding principle that the OCIO and investment managers must invest in compliance with the University’s Responsible Investment Policy. During our regular performance reviews we consider the OCIO and investment managers’ application of ESG policies in making investment decisions.
View investment portfolio data in accessible format (Excel, 484KB)
