University of Sydney is doing its bit for sustainable investment

The University of Sydney will align its $1bn investment portfolio with UN Sustainable Development Goals.

University of Sydney vice-chancellor Stephen Garton has launched the institution’s sustainable investment strategy.

The University of Sydney has committed itself to ensuring the whole of its more than $1bn endowment is placed in investments aligned with the UN’s Sustainable Development Goals by 2030.

Launching the university’s sustainable investment strategy, vice-chancellor Stephen Garton said substantial inroads had been made but more remained to be done.

“We have reduced the carbon footprint of all those investments by 70 per cent in the last six or seven years, but we want to go the next mile,” Professor Garton said.

“That means from 2021 to 2025 we’ll be looking at a transition pathway initiative: if companies haven’t articulated a clear transition away from fossil fuels towards renewables, we will be instructing our funds managers — we have about 40 of them — to start removing those companies from the pool and replacing them with other companies.”

Professor Garton said the process was technically quite difficult, and it was not yet possible to quantify the dollar amount of funds that would be on the move once the fund managers had completed their assessment of companies’ strategies for achieving the shift from fossil fuels towards renewables.

The university’s strategy has been the subject of debate on campus about how best to achieve the sustainability aim.

“There was the divestment argument from certain sections of our student and staff population, that we should just be out of fossil fuels immediately, but you could get out of fossil fuels but increase your carbon footprint — you could invest in cement, which has a huge carbon footprint,” Professor Garton said.

“So what we wanted to do was put pressure on the various pooled funds managers, and set up the next couple of years to change the pools and move away from those firms that don’t have a clear transition plan towards SDGs and aspirations.”

The other element of the strategy was the on-campus 2030 initiatives such as zero waste to landfill, zero direct and indirect emissions, elimination of single-use plastics, 100 per cent of electricity from renewables and generating three megawatts of renewable energy.

“We’re also investing a lot in doing more research and teaching in the sustainability space. About 6 per cent of our units of study have a sustainability theme already. We’d like to increase that.”

Professor Garton said the university was not a major mover by commercial standards. “We’re not like superannuation funds with billions upon billions, we’re a small player: our real aim is to have done all that transition by 2025 and to be completely aligned with the UN Sustainable Development Goals in our investment portfolio by 2030.”

The university is benchmarking against the London School of Economics Transition Pathway Initiative and aims to have defined and communicated its definitions and methodologies for assessing companies’ performance by year’s end.