The document analyzes the Ohio University Foundation's long-term investment portfolio to calculate the percentage invested directly in fossil fuels. It finds that 8.48% of the portfolio is directly invested in fossil fuels, which is more than double the national average of 4% for university endowments. It recommends short-term strategies like replacing fossil fuel-heavy funds with existing ESG funds and encouraging sustainable investing. Long-term, it suggests using proxy voting to encourage environmentally responsible behavior in companies with over 5% fossil fuel investments and moving those holdings to lower-carbon options. The overall goal is to reduce fossil fuel exposure while diversifying to more sustainable practices.

1. Cheyenne Fenstemaker, Lead Undergraduate Staff
Ohio University Office of Sustainability
FOSSIL FUEL-FOCUSED ANALYSIS OF OHIO UNIVERSITY
AND THE OHIO UNIVERSITY FOUNDATION LONG-TERM
INVESTMENT PORTFOLIO

2. 1
Introduction
Ohio University recently completed its first report through the Sustainable Tracking,
Assessment and Rating System (STARS). In alignment with a broader sustainability initiative,
The Ohio University Foundation provided the University community with a retrospective
disclosure of the Foundation’s endowment portfolio’s investments. The Ohio University Office
of Sustainability, which houses the Sustainable Investing Advisory Committee, has completed a
fossil fuel based analysis of the long-term investment portfolio.
Objective
The purpose of this analysis was to calculate the percentage of The Ohio University Foundation
Long-Term Investment Portfolio directly invested in fossil fuels. Using the information gathered
from this study, the Office of Sustainability plans to strategize for future investment
opportunities that will align with a socially and environmentally responsible agenda.
Findings
Using the information provided in the investment disclosure, as well as additional research and
resources, an analysis of $502,352,659, or, 82.05% of the total dollars allocated in the Ohio
University and The Ohio University Foundation Long-Term Investment Portfolio was completed.
According to the National Association of College and University Business Officers, only four
percent of university endowment holdings, on average, are in fossil fuels. Through my analysis
of The Ohio University Foundation Long-Term Investment Portfolio, I found that the percent of
Ohio University endowment holdings in fossil fuels was slightly more than double the average.
Of the $502,352,659.51 dollars analyzed, it was found that $42,598,722.94, or 8.48%, of the
dollars are directly invested* in fossil fuels.
Fixed Income: 3/9 invest in fossil fuels
 None are under 5% invested in fossil fuels.
 One, HC Capital Trust- The US Corporate Fixed Income Securities Portfolio, is under 10%
invested in fossil fuels.
 Two, Ohio University Student Fixed Income- Traditional and HC Capital Trust- The Fixed
Income Opportunity Portfolio, are over 10% invested in fossil fuels.
Domestic Equity: 5/5 invest in fossil fuels
 Two, HC Capital Trust- The Institutional Growth Equity Portfolio and HC Capital Trust-
The Institutional Small Capitalization-Mid Capitalization Equity Portfolio, are under 5%
invested in fossil fuels.
 One, Ohio University Student Equity Traditional, is under 10% invested in fossil fuels.

3. 2
 One, HC Capital Trust- The Institutional Value Equity Portfolio, is over 10% invested in
fossil fuels.
 One, Ohio University Student Equity Management- Sustainable, is over 20% invested in
fossil fuels.
International Equity: 3/3 invest in fossil fuels
 None are under 5% invested in fossil fuels.
 Two, HC Capital Trust- The Institutional International Equity Portfolio and Aberdeen
Emerging Markets Equity Fund, are under 10% invested in fossil fuels.
 One, HC Capital Trust- The Emerging Markets Portfolio, is over 10% invested in fossil
fuels.
Hedge Funds: No data
Commodities: 1/1 (for which we have data) invest in fossil fuels
 That fund, HC Capital Trust- The Commodity Related Securities Portfolio, is over 20%
invested in fossil fuels.
Real Estate Investment Trusts: 0/1 invest in fossil fuels
Special Opportunities: No data
Private Equity: 1/14 (for which we have data) invest in fossil fuels
 Thirteen (for which we have data) are not invested in fossil fuels.
 One, Highstar Capital Fund III, L.P. was estimated to be over 20% invested in fossil fuels.
Methodology
For the purpose of this study, I defined “direct investment in fossil fuels” as follows: “Any
monetary allocation towards a company of which 50% or more of their operations included
exploring and producing oil, gas, and consumable fuels, or generating and distributing fossil-fuel
based power sources.” The following industry sectors were applicable to my investigation based
on my previously defined definition of “direct investment in fossil fuels”:
Oil, Gas, and Consumable Fuels: “The Oil, Gas, and Consumable Fuels Industry in the Energy
Sector includes Integrated Oil & Gas, Oil & Gas Exploration & Production, Oil and Gas Refining
and Marketing, Oil and Gas Storage and Transportation, and Coal and Consumable Fuels”
Energy Utilities: “The Electric Utilities industry consists of companies engaged in generating and
distributing electric power. The industry includes hydroelectric, fossil fuel, nuclear, solar, tidal,
wind and independent electric power generators.”
Multi-Utilities: “Multiline industry consists of utilities that primarily produce and distribute
electric power and natural gas. The industry includes utility companies with significant

4. 3
operations in multiple utility operations consisting of electric, natural gas, water and other
regulated utility operations.”
Independent Power and Renewable Energy: “The Independent Power and Renewable Electricity
Producers Industry in the Utilities Sector includes companies that operate as Independent
Power Producers (IPPs), Gas and Power Marketing and Trading Specialists, and/or Integrated
Energy Merchants. It includes companies that engage in the generation and distribution of
electricity using renewable sources, including, but not limited to, companies that produce
electricity using biomass, geothermal energy, solar energy, hydropower, and wind power. It
does not include companies manufacturing capital equipment used to generate electricity using
renewable sources.”
*Industry sector descriptions: NYTimes Markets
HC Capital Trust Funds
All parts of the investment portfolio invested through HC Capital Trust were viewed in a
provided report, http://www.secinfo.com/d12TC3.meFe.htm#1090. Using the report, I
completed a line-by-line investigation of the security descriptions and industry sectors in each
individual investment portfolio. Individual holdings which were identified as belonging in one of
the previously mentioned applicable industry sectors merited further research in the MSCI ESG
Manager. I used the information provided by the MSCI ESG Manager to make the final decision
on whether or not to count a holding as “FF” (Fossil Fuel) and recorded the monetary value. The
total dollars invested in Fossil Fuels per fund was found from summing the monetary values of
holdings counted as “FF.”
Ohio University Student Managed Funds
All parts of the investment portfolio invested by the Ohio University Student Managed Funds
were viewed in two separate reports provided by their faculty advisor, Dr. David Stowe. I used
the MSCI ESG Manager and the company tickers to research each company’s business activities.
The market value in companies which identified with a previously mentioned fossil fuel industry
sector were recorded.
Private Equity
No reports were provided for the private equity holdings in The Ohio University Endowment
Long Term Investment Portfolio. Instead, I conducted individual research on each portfolio
management company. Information on portfolio holdings was drawn from disclosures found on
management company websites and annual reports. The market value of investment in
companies which identified with a previously mentioned fossil fuel sector were estimated using
the by finding the percentage of fossil fuel related companies within the total value of a
portfolio. For example, 1/3 companies of the Highstar Capital Fund III, L.P. was fossil fuel
related, so I considered the fund to be 33% fossil fuel related.

5. 4
No investment holding information could be found for the following parts of The Ohio
University Endowment Long Term Investment Portfolio (17.95%):
Hedge Funds
ArdenAlternative AdvisersSPCUSDSeriesA Tranche 1
Beach PointTotal ReturnOffshore FundIILtd.
Federal StreetAssociatesOffshore Fund,Ltd.ClassS
Hirtle CallaghanTotal ReturnOffshore FundIILtd.
LibertyViewPlusFund,Ltd.ClassB
Mariner SelectInternational,Ltd.ClassA
Commodities
CommonfundInstitutional Multi-StrategyCommoditiesFund,Ltd.
Wellington Trust Company, NA CTF Diversified Inflation Hedges Portfolio
Special Opportunities
Hirtle CallaghanSpecial OpportunitiesSPCClosed-End1
Hirtle CallaghanSpecial OpportunitiesSPCClosed-End2
PrivateEquity
CRM 2000 Enterprise FundIV,LLC
Hirtle CallaghanPrivate EquityOffshoreFundVIIILimited
Hirtle CallaghanPrivate EquityOffshoreFundIXLimited
Hirtle CallaghanPrivate EquityOffshoreFundXLimited
LexingtonLCPVI-A Offshore,L.P.
Mesirow Financial Private EquityPartnershipFundIV,L.P.
Strategy
Short-term:
Replace fossil-fuel heavy HC Capital Trust funds with existing ESG related funds.
 Move HC Capital Trust- The Institutional International Equity Portfolio to the new HC
Capital Trust- ESG Growth Portfolio
 Move HC Capital Trust- The Commodity Related Securities Portfolio to Calvert Global
Energy Solutions A (CGAEX)
 Encourage Ohio University Student Equity Management Group to keep their Sustainable
Portfolio fossil fuel free by creating stricter investment guidelines through SIAC.
 Encourage SIAC to create Sustainable Proxy Voting Guidelines.

6. 5
Effect of strategy:
If reinvested ESG holdings have 3% or less fossil fuel investments, the first three changes alone
will drop the percentage of fossil fuel investments in our portfolio from 8.5% to 4.5%. The
creation of a Sustainable Proxy Voting Guidelines document would allow Ohio University to use
proxy voting to encourage socially and environmentally responsible behavior by the companies
in which the university invests.
Long-term:
 Use Sustainable Proxy Voting Guidelines for funds greater than 5% fossil fuels to
encourage environmentally responsible behavior.
 Move holdings with investments greater than 5% fossil fuels to an ESG-focused or low
fossil fuel investment (<5%) portfolio.
Effect of strategy: A portfolio with <5% investment in fossil fuels will have a significant tilt
toward lower risk and sustainability.

Conclusion
Ohio University must strategize to lower the percentage of its endowment exposed to fossil
fuels to be at or below the national average of 4%. Ohio University views sustainability from the
triple bottom line perspective between people, planet, and profit. However, the University’s
current dependence on the fossil fuel commodity does not achieve a sustainable balance.
A 2013 study done by the Aperio Group found that when endowments used a broad range of
fossil fuel industry exclusions, the incremental risk of 0.0133% associated with this exclusion
was statistically insignificant. This study proves that the sustainable balance Ohio University is
looking for does not need to exist as a trade-off between prioritizing sustainability and
achieving financial security.
As Donald Gould, Pitzer College trustee and chair of the college’s investment committee has
argued, to divest or not to divest, should not be viewed as a “binary decision.” Instead,
divestment strategy should be viewed as a “continuum of options to reduce fossil fuel exposure
while reinvesting for sustainability.”
Moving forward, Ohio University’s goal should be to reduce its dependence on one commodity,
while diversifying the use of other cleaner and potentially more profitable practices in its
investment portfolio.
Acknowledgements
Special thanks to:

7. 6
Stephen Golding, V.P. for Finance at Ohio University
The Ohio University Foundation
Elaine Goetz, Sustainability Specialist and SIAC Advisor
David Stowe, Student Investment Faculty Advisor
References
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