As Western continues to strengthen its commitment to sustainability, a recent analysis shows the carbon footprint of the university’s long-term public equity investments is 65 per cent less than it was five years ago.
“Responsible investing is part of Western’s broader commitment to taking action on climate change,” said President Alan Shepard. “Creating a more sustainable future is reflected in our goals to achieve net-zero emissions for campus operations by 2050 at the latest and to build our capacity as a global leader in interdisciplinary sustainability research.”
Since 2015, the Western has tracked the carbon footprint of the public equity holdings in its operating and endowment fund. Between December 2019 and 2020 alone, this carbon footprint fell by 31 per cent. In alignment with Investing to Address Climate Change: Charter for Canadian Universities, the analysis is part of Western’s responsible investing strategy and pathway set for release this spring.
The carbon footprint will continue to shrink as the university continues to address the impacts of climate change, said Lynn Logan, vice-president (operations and finance), and chair of Western’s investment committee.
“Our investment team has been hard at work to advance our responsible investing strategy. With the asset mix changes we made in 2020, and the investments our team has made earlier this year, we’re confident the carbon footprint will decline further,” Logan said.
The numbers have improved steadily since the end of 2015, when the first detailed analysis took place and CO2 emissions were tallied as 193 tons per $1 million invested. By the end of 2020, emissions-per-$1-million-invested decreased by two-thirds to 68 tons.
Last year, Western signed Investing to Address Climate Change: Charter for Canadian Universities. As part of its commitment to the charter, the university is working closely with Mercer Canada to measure the institution’s total portfolio carbon footprint, not only for the public equity holdings, but for all asset classes (public equity, private equity, fixed income, real estate, infrastructure and diversifiers).
“A total portfolio approach to measuring the carbon footprint is going to be essential for ensuring the world addresses climate change, and Western’s commitment to set a baseline to track future progress for all investments is showing real leadership for higher education in Canada,” said Monika Freyman, head of sustainable investment, Mercer Canada.
As part of the responsible investing strategy and pathway, further analysis on Western’s operating and endowment fund is underway; a comprehensive carbon transition analysis which, combined with the total portfolio carbon footprint will guide Western in setting decarbonization strategies and targets for the future.
This work follows on the university’s June 2020 commitment to allocate as much as 10 per cent of the operating and endowment fund (at the time, about $150 million) to sustainable investments initially along the themes of clean and renewable energy, water treatment and waste management solutions, and potentially expanding into additional sustainable development goals.
Western has allocated the first 2.5 per cent of that commitment to a renewable-energy infrastructure fund, which will positively impact the carbon footprint of the operating and endowment fund.
Aiming for net-zero
Western’s numbers reflect an accelerated commitment to reduce carbon emissions: building on successive years of sustainability efforts and commitments in the new strategic plan to tackle climate change, including reducing the university’s greenhouse gas emissions by at least 45 per cent by 2030, and achieve net-zero emissions for campus operations by 2050.
“The university’s sustainability pledge extends to every facet of campus operations, from purchasing to building design – and it also includes our investment portfolio,” said Logan, who is also co-chair of the President’s Advisory Committee on the Environment and Sustainability (PACES).
“It’s important that our campus and investment priorities are aligned; we’re committed to a net-zero Western, the targets we set, over time, will work towards a portfolio that shows the same sense of global responsibility.”
Western is committed to implementing an investment approach that positions sustainability as a fundamental concept in wisely allocating financial capital to benefit current and future generations. The university plans annual updates on progress towards 2030 and 2050 goals.
Committed to sustainability
During the next two weeks, the eyes of the world will be on UN Climate Change Conference UK 2021 (COP26) in Glasgow, where international political and environmental leaders will present their progress towards climate-action goals.
Western is no newcomer to sustainability across campus and beyond, as reflected in strategy, research, teaching and learning, and policies and practices.
In 2016, Western joined a global community of universities, businesses, cities and other groups in signing the Paris Pledge for Action and committed to doing its part to limit the global temperature rise to less than two degrees Celsius.
Last month, Western joined the University Climate Change Coalition, a group of leading North American research universities working to accelerate local and global solutions to climate change.
Western also continues to ramp up its commitment to the United Nations’ 17 Sustainable Development Goals, efforts that earlier this year placed the university among the top five per cent of global universities in the Times Higher Education Sustainability Rankings.
Approved in April, Western’s 2021-22 budget saw significant investment in sustainability, including $10-million to support campus-wide sustainability initiatives and a new, $1-million green innovation fund.