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SFU Beedie’s student-managed funds to drop fossil fuel investments

Dec 08, 2021

An electrical engineer supervising the condition of Wind Turbine Equipment.

SFU Beedie’s two student-managed investment funds are set to become fossil-fuel-free, in line with the university’s commitment to full divestment from fossil fuels announced on November 2, 2021. The $22.4 million Student Investment Advisory Service (SIAS) fund, run by students in SFU Beedie’s MSc in Finance program, and the $8.02 million Beedie Endowment Asset Management (BEAM) fund, run by undergraduate students, have both made the commitment to divest by the end of 2022.

Both BEAM and SIAS offer students with an interest in investments the opportunity to gain valuable experience investing real money on behalf of the university. The funds replicate the experience of running a real investment management company. Students are responsible for investment decisions, they determine the merits of an investment and whether it complies with policy, and they are accountable for the results. Many SIAS and BEAM alumni, who have gone onto senior roles throughout the industry — including institutional investing, risk management, insurance, investment banking and wealth management — got their first taste of investment through these funds.

In order to achieve divestment, a new joint committee has been created, chaired by alumna Emily Davies – partner at Linde Equity. Peter Klein, faculty advisor to the BEAM and SIAS funds, explains that the committee will establish an ‘excluded list’ of industry sectors and specific companies in which the funds will no longer invest.

“We will need to sell anything we currently own on those lists, then the next thing is to determine what we will do with the proceeds,” says Klein. “We will likely just scale up some existing holdings that are eligible, but we will need to study that as well. And then we need to also consider how we’re going to measure performance moving forward.”

These new considerations, Klein says, offer exciting opportunities for students to gain valuable knowledge of the growing responsible investment space, which is taught through their finance courses. He also sees it as an opportunity for longer-term projects and research.

“We will have some of the MSc in Finance students study the issue as part of their dissertations,” he says. “That will tie in really nicely.”