Environmental, Social and Governance (ESG) Investment Considerations at Pitt

The University of Pittsburgh is committed to incorporating ESG factors in the management of the Consolidated Endowment Fund (CEF), the University's largest financial asset.

Since March 2020, the Investment Office, which manages the CEF, has followed an ESG Policy for the CEF. The ESG Policy provides the University with a more consistent and comprehensive approach to evaluating investment opportunities.

The ESG Policy states the University’s commitment to “fully integrating ESG factors into the University’s decision-making processes, on the core belief that supporting responsible business practices also supports strong investment outcomes.”

Fourth ESG Report Published 

The fourth annual ESG report (PDF) was published in June 2025, reflecting information from Fiscal Year 2024. The report provides updates on the following:

  • The CEF’s fossil fuel exposure.
  • External investment managers currently overseeing approximately 94% of the CEF by value have formal ESG policies in place or take ESG considerations into account when making investments.
  • Although the University does not preemptively exclude fossil fuel investments, known as applying a negative screen, the University has not made any direct investment in fossil fuel companies or new commitments to fossil fuel-focused funds in more than four years.

The Investment Office continues to meet with key student organizations on a regular basis as well as speak at various University forums to enhance overall awareness and improve dialogue on this important topic.

Third ESG Report Published

The third annual ESG report (PDF) was published in May 2024, reflecting information from Fiscal Year 2023. The report provides updates on the following:

  • The CEF’s fossil fuel exposure.
  • External investment managers currently overseeing approximately 93% of the CEF by value have formal ESG policies in place or take ESG considerations into account when making investments.
  • Although the University does not preemptively exclude fossil fuel investments, known as applying a negative screen, the University has not made any direct investment in fossil fuel companies or new commitments to fossil fuel-focused funds in more than three years.

A high-level overview of the report can be found in this Pittwire article.

The Investment Office continues to meet with key student organizations on a regular basis as well as speak at various University forums to enhance overall awareness and improve dialogue on this important topic.

Second ESG Report Published

In an effort to continue to enhance transparency regarding the CEF and the implementation of the ESG policy, the second annual ESG report (PDF) was published in April 2023, reflecting information from Fiscal Year 2022. The report provides updates on the following:

  • The CEF’s fossil fuel exposure.
  • The CEF’s approach to direct engagement with underlying companies in which the endowment holds investments and the use of proxy voting.
  • External investment managers currently overseeing approximately 87% of the CEF by value have formal ESG policies in place or take ESG considerations into account when making investments.

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A high-level overview of the report can be found in this Pittwire article.

Inaugural ESG Report Launched

In March 2022, the University of Pittsburgh’s Investment Office released the “Inaugural Consolidated Endowment Fund Environmental, Social and Governance Report" (PDF). The Fiscal Year 2021 report details how the University of Pittsburgh incorporates environmental, social, and governance (ESG) factors in the management of the University’s Consolidated Endowment Fund (CEF). The report “seeks to provide greater clarity regarding how ESG factors are applied in the [University’s] investment decision-making process as well as report on fossil fuel trends.”

A high-level overview of the report can be found in this Pittwire article.

Frequently Asked Questions

Following a review of the topic by the Ad Hoc Committee on Fossil Fuels in 2020-21, it was recommended, and approved by the Board of Trustees, that the University not implement a negative screen regarding fossil fuels. One consideration behind that decision was that the University would face a significant financial loss were it to divest. That loss would conflict with the purpose of the endowment, which is to support institutional financial aid, scholarships, faculty positions and research activities in perpetuity. However, it was recommended that, for financial reasons, private holdings of fossil fuels would be allowed to roll off over time.

The University has confidentiality agreements in place with many of the funds in which we invest, and therefore, we are not legally allowed to share specific holding information. We also view our investment activity, including the specific managers with whom we partner, as being proprietary.

At the time that the topic of divestment was originally evaluated by the Board of Trustees, it was determined that the exploration and production of fossil fuels would continue to become less attractive investment opportunities over time. Supporting responsible business practices is integral to producing strong investment outcomes.

History of ESG at Pitt

In 2014, the Fossil Free Pitt Coalition began asking the University to directly address its fossil fuel investments.

In January 2018, Chancellor Patrick Gallagher created a Socially Responsible Investment (SRI) Committee of faculty, students, and staff “to investigate and provide a foundation of facts that could be used by the University to explore socially responsible investment (SRI) strategies that may be suitable for consideration for the University’s endowment.”

The 2018-19 SRI Committee “met numerous times, conducted a literature search on relevant topics, collected data on SRI funds and their relative performance and costs, analyzed stated SRI practices of a limited set of other universities with large endowments, and solicited the views of the University of Pittsburgh’s community and stakeholders through two open forums and a public online forum.” In April 2019, the SRI Committee presented its report to the Chancellor (PDF).

In August 2019, Chancellor Gallagher directed the Office of Finance to 1) Develop ESG criteria and present it to the Board’s Investment Committee; 2) Establish an approach for “screening and presenting proposed investment exclusions” to the Board; and 3) Expand and leverage the University’s long-term sustainability plan.

In February 2020, Pitt’s Board adopted an SRI Screening Process (PDF).

In March 2020, the University released its ESG Policy (PDF).

In June 2020, Pitt’s Board of Trustees activated the SRI Screening Process and created the 2020-21 Board of Trustees Ad Hoc Committee on Fossil Fuels, to provide a report on “options on whether, to what extent, and via what methods the University, in its Endowment, should consider divestment from fossil fuels in existing and/or future investments;” all Ad Hoc Committee members were University Board members.

The 2021 report (PDF) of the Ad Hoc Committee on Fossil Fuels was adopted in full by the Board of Trustees in February 2021, including the following options for future action:

  1. Actively choose to not apply a negative screen to the Endowment with respect to fossil fuels.
  2. Support the University’s existing ESG Policy (PDF) and direct the University to apply ESG considerations to every investment decision.
  3. Support the Board’s Investment Committee in monitoring expectations that the Endowment’s private investments in fossil fuels will go to zero by the end of 2035, while continuing to pursue strong “risk-adjusted financial returns.”
  4. Direct the Board’s Investment Committee to develop and implement a strategy to seek investments that help reduce, avoid, and eliminate greenhouse emissions.
  5. Direct the University to provide greater transparency regarding the Endowment generally, as well as in its fossil fuel investment trends.
  6. Support the University in publishing its first public ESG Report in 2021, which will address ESG considerations generally as well as fossil fuel investments.
  7. Support “regular, clear, and accessible University communication, education, and engagement” about the Endowment’s “status, trends, and current and future fossil fuel exposure…including an annual update to the Board and University community.”

There is currently no separate SRI or ESG Committee at the University. All CEF decision-making is governed by the Investment Committee (which has Trustee, faculty, staff, and student members), which “provides oversight and guidance to the Chief Investment Officer regarding the management of the University endowment.” (2021 Ad Hoc Report)