Sustainable Investment Policy

 

I. POLICY STATEMENT

Southern Leyte State University (SLSU) upholds its institutional responsibility not only to educate and innovate, but also to steward public and donor resources in a manner that upholds long-term environmental, social, and financial sustainability. As a government higher education institution situated in one of the most climate vulnerable regions of the Philippines, SLSU recognizes the critical role that investment strategies play in either perpetuating environmental harm or enabling transformative development. Through this Sustainable Investment Policy, the university affirms its commitment to supporting a just transition to a low-carbon, inclusive, and resilient future.

This policy serves as a framework for embedding environmental, social, and governance (ESG) principles into all aspects of the university’s financial investment decisions. It is built on the understanding that sustainability and financial performance are not mutually exclusive. Rather, long-term value creation depends on managing risks associated with climate change, inequality, resource depletion, and governance failures. The university believes that sustainable investing is not only an ethical imperative but also a prudent financial strategy that safeguards institutional integrity and resilience.

The policy explicitly reflects SLSU’s alignment with international frameworks such as the United Nations Sustainable Development Goals (SDGs), the Paris Agreement, and the Principles for Responsible Investment (PRI), as well as compliance with relevant national policies, including the Philippine Climate Change Act (RA 9729), Renewable Energy Act (RA 9513), and the Green Jobs Act (RA 10771).

By committing to divest from fossil fuels and other unsustainable sectors, and by proactively investing in initiatives that benefit local communities and promote ecological balance, SLSU seeks to model responsible governance for academic institutions nationwide. This policy is a living document—dynamic, responsive, and rooted in the university's strategic direction to mainstream sustainability across its academic, operational, and financial functions.

II. OBJECTIVES

1. To ensure that SLSU’s investment portfolio supports sustainable economic, social, and environmental outcomes.
2. To gradually divest from fossil fuel-related and other environmentally unsustainable investments.
3. To prioritize investments that benefit local communities and support environmentally responsible enterprises.
4. To integrate Environmental, Social, and Governance (ESG) criteria into all investment decision-making processes.
5. To uphold transparency and accountability in the university’s financial and investment practices.

III. SCOPE AND APPLICABILITY

This policy applies to all investments under the control of Southern Leyte State University, including but not limited to:

• University trust funds
• Endowments
• Donations
• Grants allocated for investment
• Any other financial instruments or portfolios where SLSU exercises discretion or influence

IV. PRINCIPLES OF SUSTAINABLE INVESTMENT

1. Environmental Responsibility

• • SLSU shall avoid investing in companies or funds that significantly contribute to environmental degradation, particularly:
  • Fossil fuel exploration, extraction, processing, and distribution
  • Coal mining and coal-powered energy generation
  • Deforestation and unsustainable land-use practices
  • Industrial operations with poor environmental compliance

Instead, the university will direct funds toward:

• • Renewable energy and clean technology
  • Climate-resilient infrastructure
  • Waste reduction, circular economy, and low-carbon innovations

2. Social Equity and Community Investment

SLSU shall prioritize investments that:

• • Generate measurable social benefits, particularly for marginalized and vulnerable communities
  • Support small- and medium-sized enterprises (SMEs) in Southern Leyte and the Eastern Visayas region
  • Promote inclusive education, health, agriculture, and rural development
  • Advance gender equity, human rights, and indigenous peoples' welfare

3. Governance and Ethical Practices

All investment decisions shall be guided by high standards of governance, including:

• • Transparent operations and reporting
  • Accountability to stakeholders
  • Anti-corruption and anti-bribery compliance
  • Fair labor practices and human rights protections

V. COMMITMENT TO DIVESTMENT FROM FOSSIL FUELS

SLSU commits to a structured and transparent divestment plan from fossil fuel related investments:

• Immediate halt to any new investments in fossil fuel companies and related instruments.
• Audit of existing investments within the next 12 months to identify fossil fuel related assets.
• Divestment timeline of 3 years for direct investments and 5 years for indirect exposures (e.g., pooled funds), subject to fiduciary responsibility.
• Annual public disclosure of divestment progress and challenges.

The university shall engage fund managers and stakeholders in advocating for fossil free portfolios and explore the adoption of climate-conscious financial products.

VI. SUSTAINABLE AND LOCAL INVESTMENT INITIATIVES

SLSU shall:

• Allocate a portion of its investment portfolio to cooperatives, microfinance, and community-based enterprises in Southern Leyte.
• Partner with development banks, government agencies, and impact investors to co-finance local environmental and livelihood projects.
• Support university-led ventures on renewable energy, organic agriculture, climate-smart education, and disaster resilience.

VII. ROLES AND RESPONSIBILITIES

• Board of Regents: Approves the Sustainable Investment Policy and major divestment/investment actions.
• President and Vice President for Administration and Finance: Oversees implementation and ensures policy alignment with university strategy.
• Investment and Sustainability Committee:
  • Reviews and recommends investment proposals aligned with ESG standards
  • Monitors divestment progress
  • Assesses sustainability performance of investments
• Financial Management Division: Maintains financial compliance and reporting.
• Office of the University Planning and Development: Integrates investment plans with institutional sustainability goals.

VIII. COMPLIANCE AND MONITORING

• Annual sustainability audit of investment portfolio by an independent body or internal audit team.
• Regular impact assessment of community and environmental investments.
• Submission of annual sustainability investment report to the SLSU Board and public stakeholders.
• Use of internationally recognized ESG benchmarking tools and standards (e.g., UN PRI, GRI, ISO 26000).

IX. SANCTIONS AND ACCOUNTABILITY

Failure to comply with this policy may result in:

• Review and revocation of delegated financial authority
• Investigation by internal audit or appropriate oversight body
• Disciplinary actions for willful negligence or non-compliance, in accordance with university rules and Philippine law

X. POLICY REVIEW

• Republic Act No. 9729 (Climate Change Act of 2009)
• Republic Act No. 9513 (Renewable Energy Act of 2008)
• Philippine Development Plan 2023–2028
• United Nations Sustainable Development Goals (SDGs)
• Principles for Responsible Investment (UN PRI)
• Global Reporting Initiative (GRI) Standards