…. as green investments/sustainability become a focal point

The Yale endowment has a substantial and growing exposure to green investments with allocations in timberland, emerging markets and venture capital including more than $100 million in cleantech.

In the endowment’s 2009 fiscal year report it states that its exposure to cleantech is growing rapidly and in the past year alone Yale’s venture capital managers invested in more than nine new cleantech companies.

There are about 70 early-stage cleantech companies in the Yale portfolio.

Yale has increased its exposure to the sector in the marketable, real assets, and leveraged buyout portfolios as well.

“We are confident that the University stands to benefit enormously from the endowment’s involvement in green ventures, both as an investor and as a stakeholder in the health of the environment.”

Sponsored Content

The report disclosed a number of significant investments in cleantech companies, including Silver Spring (the developer of technology for smart grids), and Mascoma, a bio-ethanol research and development company.

Within emerging markets the endowment has invested in a number of public and private companies that provide solutions to reduce reliance on highly polluting fossil fuels including HT Blade, a Chinese wind turbine producer which among other things provides 90 per cent of the Chinese domestic demand and has just signed a $300 million deal to provide wind farms in Dallas, Texas.

Suntech Power Holdings has also been an endowment investment, the largest solar cell manufacturer in the world, also a Chinese-based company but listed on the New York Stock Exchange.

Yale has more than three million acres of timber investments that are all managed in a sustainable fashion.

In recent years Yale’s timberland managers have become increasingly involved in alternative energy projects that curtail carbon dioxide emissions.

Windfarms on forestlands represent another opportunity in which the endowment’s managers see potential.

“Investments in wind on Yale lands could provide a meaningful economic return to the endowment while helping the university achieve its sustainability goals. Yale’s wind power projects could play a critical role in helping Yale reach its stated goal of reducing 2020 emissions to 10 per cent below 1990 levels, further Yale in its quest to become the world’s greenest university,”the report said.

Timber is part of Yale’s real assets portfolio which in the past year returned 32 per cent, and since inception in 1978 has returned 14.3 per cent per annum.

According to the 2009 report a critical component of Yale’s ivnestment strategy is to create strong, long-term partnerships between the investments office and its investment managers. In the last decade, Yale has been involved in the development and growth of more than 12 organisations involveed in the management of real assets.

For real assets Yale uses an active benchmark of NCREIF and Cambridge Associates Composite and for private equity it uses the Cambridge Associates Composite.

Leave a Comment

Sort content by

Ibbotson says Brinson ‘not quite right’ on returns

Portfolio specific asset allocation policy and portfolio security selection, timing and fees contribute equally to the variation of portfolio returns according to new research by Professor Roger Ibbotson of Yale School of Management, progressing earlier work by Brinson et al which attributed more than 90 per cent to asset allocation.   mrec4inarticleinline Sponsored Content scnative1

CalSTRS expands active/passive decision making

CalSTRS will double the ranges of its active/passive global equities allocations in a bid to enable investment staff to allocate funds tactically across active and passive rather than be forced to rebalance to strategic asset allocations. mrec4inarticleinline Sponsored Content scnative1 scnative2 scnative3

SEC reforms aim to boost liquidity

Associate director at RogersCasey, Carolyn Cross examines the SEC-approved money market fund reforms, which aim to bolster liquidity, increase credit quality, and improve the flexibility and transparency of operations to ensure money market funds can weather the next crisis, summarising key provisions of the new rules and how they impact investors. mrec4inarticleinline Sponsored Content scnative1

Complacency about liquidity a trap for institutions

Liquidity is the paramount risk factor for institutional investors to be cognisant of according to Ben Golub, vice chairman and chief risk officer, Blackrock who has co-authored a new paper outlining the risks learned from the credit crisis. He spoke to Amanda White about the suitable internal structure for institutional risk management and the risk

Mercer going cold on global shares as valuations pushed

Mercer Investment Consulting has revised down its view of global equities markets, suggesting the rally has pushed prices to fair value from their previous rating of undervalued. mrec4inarticleinline Sponsored Content scnative1 scnative2 scnative3

CalPERS to commit $22bn to private equity

CalPERS is expecting to deploy the $22 billion in unfunded commitments of its alternatives investment management program in the next two to three years, with greater concentration among the best performing managers one of the priorities for 2010. mrec4inarticleinline Sponsored Content scnative1 scnative2 scnative3

Previous