Trustees Announce ESG Investment Strategy for Pooled Investment Fund
The Trustees of the Episcopal Church in Minnesota (ECMN), tasked with the responsibility of managing the Pooled Investment Fund (PIF) on behalf of ECMN and participating faith communities, are excited to announce that they have approved a new investment strategy focused on ESG investing.
ESG centers investments that generate a measurable, positive social and/or environmental impact alongside a financial return, utilizing environmental, social and governance data to guide investments. The Trustees have chosen to adopt the United Nations 17 Sustainable Development Goals in our efforts to positively screen suitable investments for the Pooled Investment Fund (PIF). These 17 goals are found in this ESG powerpoint presentation, on page 5. With Bishop Loya’s guidance, the ECMN has chosen to focus on five of these goals: gender equality, affordable and clean energy, reduced racial inequalities, responsible consumption and production, and climate action.
Bishop Loya has framed the importance of utilizing ESG as a tool to guide our investments:
“As followers of Jesus, we are called to use everything we are, and everything we have, to further the Spirit's work of forming Beloved Community in the world. As a diocese, and as local faith communities, we have been entrusted with extraordinary resources that have supported our ministries for generations, and continue to sustain us today. I am so grateful that the Trustees of the Episcopal Church in Minnesota have recently adopted an investment policy that will ensure the dollars in our PIF will support the Spirit's work in the world, in addition to supporting our ministries here in Minnesota. Women's empowerment and gender equality, environmental sustainability, and racial justice and equity are clearly articulated priorities for the whole Episcopal Church, and any progress made in each of these areas has an exponential impact on making our world a place that looks more like God's dream of love. I hope this new policy will be a welcome affirmation for those faith communities who already participate in the PIF, and inspiration for other faith communities to join us. It's one more way that, as Minnesota Episcopalians, we are better together, and together, we can join God's project of healing the whole world with love.”
Indices that incorporate ESG factors have generally performed as well as, or better than, conventional indices. Please see pages 12 and 13 of the powerpoint linked above for performance data and comparative median total returns of ESG funds and traditional funds. While past performance does not guarantee future results, we are confident that the concept and implementation of ESG factors should not negatively impact results and may very well add value if recent data is any indication. ESG investing allows ECMN to screen out “bad actors” from our investment portfolio, but, more importantly, also seeks out and identifies companies that are making positive social and environmental impacts for further investment. This truly allows ECMN and all PIF participants to align our invested dollars with the values and vision that God is calling us to.
The Trustees take their responsibility in managing both equity and returns seriously, and will continue to work closely with Morgan Stanley and Graystone Financial, who have spent decades advising institutional clients around investing in a way that considers ESG as well as financial returns. The Trustees recognize this is a change, and welcome dialogue and questions from current as well as prospective PIF participants.