Sustainable Investment Policy

Policy Statement

An-Najah National University is committed to ensuring that its investment portfolios adhere to the highest Environmental, Social, and Governance (ESG) standards and actively contribute to global sustainable development priorities.

This policy establishes the guiding principles and governance frameworks governing the University’s investment decisions and portfolio management, with a strong emphasis on measurable sustainability outcomes, climate responsibility, social equity, and ethical governance.

The University recognizes its fiduciary duty to balance financial stewardship with social and environmental responsibility. Accordingly, it commits to integrating sustainability risks and opportunities into all investment decisions, aligning its portfolio with international best practices, including:

• United Nations Principles for Responsible Investment (UNPRI)
• UN Sustainable Development Goals (SDGs)
• Paris Climate Agreement objectives
• Global Reporting Initiative (GRI) standards

Scope

This policy applies to all investments made by the University, including but not limited to:

• Endowment funds
• Investment funds and portfolios
• Fixed-income securities
• Equities
• Venture capital allocations
• Infrastructure investments
• Partnerships and joint ventures
• Strategic investment reserves

The policy applies to both internally managed and externally managed funds.

Purpose

The purpose of this policy is to formally integrate ESG factors and impact-based criteria into the University’s investment decision-making process.

Through this framework, the University aims to:

• Identify and mitigate environmental, social, and governance risks
• Promote responsible and impact-oriented investing
• Support climate transition and decarbonization
• Contribute to sustainable economic development
• Generate measurable positive social and environmental impact
• Ensure long-term financial resilience and intergenerational equity

Sustainable Investment Objectives

Environmental Stewardship

• Prioritize investments in renewable energy, clean technology, green infrastructure, sustainable agriculture, circular economy models, and climate-resilient systems
• Gradually reduce exposure to high-carbon assets
• Avoid new investments in fossil fuel extraction and coal-based energy production
• Support companies aligned with net-zero transition pathways
• Promote biodiversity protection and responsible water use

Social Responsibility

• Invest in companies that uphold international labor standards
• Support diversity, equity, and inclusion initiatives
• Promote gender equality and women’s leadership
• Encourage access to healthcare innovation and medicines addressing global health crises
• Support education, sustainable housing, and inclusive financial services

Governance and Ethics

• Invest in organizations demonstrating strong corporate governance
• Require transparency in ESG disclosures
• Favor companies with independent boards and strong anti-corruption frameworks
• Promote ethical supply chain management

Long-Term Financial Performance

• Balance competitive financial returns with sustainability outcomes
• Evaluate long-term value creation rather than short-term gains
• Integrate ESG risk-adjusted performance metrics into evaluation models

Investment Principles

ESG Integration

All investment decisions shall undergo ESG screening and sustainability risk assessment prior to approval. ESG scoring tools and third-party sustainability ratings may be used to support decision-making.

Positive Screening

The University will actively allocate capital toward:

• Renewable energy projects
• Sustainable healthcare technologies
• Green bonds
• Impact investment funds
• Climate transition financing
• SDG-aligned enterprises

Exclusionary Criteria

The University shall not invest in entities significantly engaged in:

• Fossil fuel extraction or coal power generation
• Tobacco production
• Arms and weapons manufacturing
• Severe human rights violations
• Environmentally destructive activities
• Systematic corruption

Divestment Mechanism

Where existing investments are found to be misaligned with ESG principles, the Investment Committee will:

1. Engage with the entity for improvement
2. Establish a defined remediation timeline
3. Divest if sufficient corrective action is not taken

Engagement and Advocacy

The University will actively engage with fund managers and portfolio companies to:

• Encourage improved ESG performance
• Promote climate transition plans
• Strengthen social impact reporting
• Support sustainable governance reforms

Alignment with Global Standards

The policy aligns with leading global university endowment practices and sustainability standards including UNPRI and SDG frameworks.

Transparency and Accountability

The University requires:

• Annual ESG reporting from fund managers
• Disclosure of carbon intensity exposure
• Impact reporting aligned with SDGs

Risk Management

ESG risks—including climate transition risks, physical climate risks, reputational risks, and governance risks—are integrated into financial risk assessment models.

The University Investment Committee

The Investment Committee is responsible for overseeing the financial, governance, and sustainability performance of the University’s investments.

Its responsibilities include:

• ESG due diligence review
• Sustainability performance monitoring
• Annual portfolio carbon exposure assessment
• Review of compliance with exclusionary criteria
• Approval of new sustainable investment allocations

The Committee convenes quarterly to:

• Evaluate fund manager performance
• Review ESG impact metrics
• Adjust allocations toward sustainable assets
• Update policy based on emerging global standards

The primary objective of the University Endowment and Investment Fund is to ensure long-term capital preservation and growth while generating sustainable income to support academic, research, innovation, and community initiatives.

Measurable Targets and Commitments

To ensure accountability, the University commits to:

• Increasing sustainable/ESG-aligned assets to a defined percentage of the portfolio
• Reducing carbon exposure intensity progressively
• Publishing ESG impact indicators annually
• Reviewing the policy every two years

Reporting and Accountability

The University will publish an annual Sustainable Investment Impact Report, including:

• Portfolio ESG breakdown
• SDG contribution mapping
• Carbon exposure analysis
• Sustainable asset allocation percentage
• Divestment actions taken
• Engagement activities conducted
• Impact case studies

This report will be publicly accessible through the University website to ensure transparency and stakeholder accountability.

Effective Date: October 12, 2016
Last Review Date: June 15, 2025