Evaluation of sustainability principles

The University of Göttingen is aware of the social responsibility and role model function of universities in contributing to sustainable development. Therefore, the University of Göttingen also takes societal responsibility in its financial investments and became the second university in Germany to commit to divestment. Since then, the University selects its financial investments not only on the basis of economic aspects, but also according to social, ethical and ecological criteria. Investments that do not fulfil certain sustainability relevant parameters are sold gradually.

When selecting suitable financial investments, the university focusses on social, ethical and ecological investments based on the United Nations (UN)l Agenda 21 and other suitable sustainability indices. Investments in companies whose main line of business is exploration, extraction, transport and distribution or energy production from fossil and nuclear energy sources (coal, natural gas, oil, uranium) are generally not eligible. The same applies to companies that violate the core labour standards of the International Labour Organization (ILO).

The selection of financial instruments is therefore not only about excluding investments in fossil fuels, but also about incorporating ESG (environmental, social and governance) criteria. This ensures that the three sustainability dimensions environment, social affairs and corporate governance are taken into account. The expertise of the independent provider MSCI ESG Research LLC is used to ensure the consistent implementation and achievement of the sustainability criteria. The rating scale used by the provider includes seven so called scores and ranges from AAA ("Leader/Green") to CCC ("Laggard/Red").

In order to promote the continuous expansion of sustainability in financial investments, the University of Göttingen has decided, in addition to the criteria defined in the investment principles, that new investments in financial assets must have an MSCI ESG rating of at least "A".

In order to implement divestment, i.e. the sale of financial assets relating to companies whose main line of business relates to the above-mentioned fields, financial securities (shares and bonds) with a volume of around € 8.5 million have been sold since 2018. Other financial investments that could not be directly allocated to the exclusion criteria of the investment principles but did not have the defined minimum "A" rating according to MSCI ESG were also actively sold with a volume of around € 10 million.

As a result, 34% of university investments are currently invested at the "Leader" (AAA) rating level and a further 31% meet the minimum "A" rating. In addition, 28.75% of financial investments (term deposits and daily allowances well as real estate funds) are in line with the UN and ILO sustainability criteria. Only 6% of financial investments still have a rating of "BBB" and only 0.25% are classed as "Laggard". These positions, which do not currently meet the specified sustainability criteria, are related to two company bonds and one financial stock. These three investments were made before 2018 and are monitored closely.

This means that 93.75% of existing university financial investments and 100% of new investments already meet the requirements for sustainable investments. The university also holds an investment in the field of renewable energy, which is specifically focused on such projects and their infrastructure. The university thus contributes significantly to additional CO2 savings.