How to Go All-in: Investing Full Portfolios toward Environmental and Social Benefits

transcript

How to Go All-in: Investing Full Portfolios toward Environmental and Social

Benefits

Dr. Robert E JohnsonBecker College@BeckerPrez

The Path to 100% Impact in Becker College Endowment

ü Q1-2016: Commit to 100% Impact Goal in the Becker Endowment -BOARD APPROVAL of IPS Addendum

ü Q2-2016: Inform HIP-rate Fund Managers on their Impacts:q Both existing and prospective fund managers by June 30q Signal that positive impact is criteria for ongoing investment

ü Q3-2016: Analyze Potential Changes in Fund Managersq Calculate the HIP impact ratings and risk-adjusted returns of possible new %

and $ allocations – including timelineq Evaluate funds on impact ratings and possible customizations/SMAs

q Q4-2016: Begin Migration to Funds & Strategies for 100% Impactq Approve portfolio changes (adds, drops, and customizations)q New fund managers and existing fund managers with shift to higher impact

q 2017: Measure Quarterly Progress towards 100% Impact Goals q Fund managers to engage investees on impact more methodically

Impact Metric Goals in theNew IPS

Current 2016(Excl. Hedge Funds)

Proposed 2016(No Hedge Funds)

1) IMPACT: Absolute HIP Rating (weighted-average) 50%+ 47% 52%

Net Positive

2) IMPACT: Relative HIP Rating(weighted-average vs. industry peers)

75%+ 68% 75%Top Quartile

3) RISK-ADJUSTED RETURNS:• Annual 5-yr Volatility• Annual 5-yr Returns• Sharpe Ratio

Growth60-20-20

allocation

9.9%11.5%1.09

9.7%11.2%1.15

4) FEES (weighted-average of funds/SMAs) Reasonable 0.84% 0.53%

What is Important about Investing?

FUTURERISK

+UPSIDE

84% of Market Value = Intangible

HIP’s Rating Measures Impact, Drivers of Future Risk, and Potential Returns

HIP’s Rating Helps Investors

HIP’s Rating Serves Investors

Be More HIPR. Paul Herman,

CEO & Founderpaul@HIPinvestor.com

1-415-902-7741

@HIPinvestor

Fabian Willskytt,

Vice President

Joy P. Poland,

Advisor

1-401-714-7123

How to Go All-in: Investing Full Portfolios toward Environmental and Social Benefits

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