Concordia University’s Journey to Impact Investing
As University Treasurer and Chief Investment Officer, Marc Gauthier is responsible for the oversight of the University’s and its related entities’ balance sheet, which includes: investments (pension fund and foundations), corporate risks, capital budget and financing. He also oversees the governance and financial management of the University’s benefits which include the pension plan on the whole and group insurance plans. When the sustainable investing journey started in 2018, he converted this opportunity into a “financial sustainability”.
On the corporate finance front, he has been working on integrating ESG into the capital investments and financing processes of the University. A first initiative was the University’s sustainability bond in 2019 and he is currently seeking to connect the performance of the University’s ESG rating and the Foundation’s responsible and impact investments realizations into its global financing program in an incentive to reduce financing cost with its counterparties.
Related to investments, Marc prefers to use the term “Impact investments”, with the goal of doubling that portfolio to 20% by year 2025. Starting past fall, he has been working on a plan to transition asset allocation accordingly.
“When we started the responsible investing program, we sat own with faculty and students,” Marc shares, “Our impacting investment program touches all 17 UNSDGs (United Nations Sustainable Development Goals). It is more diversified than just climate change risk.”
On the implementation front, integrated due diligence plans include not only hiring the right managers, but also many other components, i.e., engagement, report, tactical asset allocation. Engagements are still outsourced to external managers. Besides sourcing impact deals, Marc is focused on building a program to implement it. “We look at opportunities that are yet to be addressed or already addressed, out of the 17 UNSDG goals.”
When COVID-19 happened, in addition to cutting his two-and-half to three hours commute down, Marc saw a lot of positive sides coming out of it. From impact investing standpoint, “COVID brought up society inequality onto the surface. It has been positive in balancing the need for sustainability and equality.”
When asked about if Concordia University has done anything to divest, Marc adds, “Our intention is to do so, but we’ve yet to begin the process.”
Marc Gauthier, Treasurer and Chief Investment Officer at Concordia University, spoke at Institutional Connect Virtual Forum in October 2020