4. Ethical Investment & banking

A strong ethical investment policy ensures an institution’s investments and banking practices are conducted transparently and in an economically-viable, socially-responsible manner, not in opposition to wider social, environmental and humanitarian concerns. Institutions pride themselves on their work combating climate change, whether through their research, teaching and learning, or carbon reductions. This ethos can be reflected in an institution’s investments. However, investments in the fossil fuel industry or arms trade can be contradictory to an institution's broader sustainability aims and goals.

Local authorities, New York City and entire countries (Ireland) have taken action to ensure their investment portfolios are not funding fossil fuels.

87 UK Universities have now taken action to reduce or remove their investments in fossil fuels, which now means those who have not divested are now the minority. Investments in the fossil fuel industry are increasingly seen as financially unsustainable, with many looking to shift their investments into more sustainable industries . Experts including the The World Bank, MPs and our own institutions have warned against the ‘Carbon Bubble’, which could see billions of pounds lost if investments are kept in coal, oil and gas. This is why the People & Planet University League focus is not only on the transparency of universities’ investments, but the areas or sectors within which these are held.

Ethical investment policies are not only necessary to direct decision-making around the investment of ‘extraneous funds’ they inform decisions about all areas of investment conducted by an institution, including but not limited to equities investment and an institution’s choice of banking providers.

If an ethical investment policy isn’t put into practice then it becomes meaningless. The People & Planet University League only awards full points if the policy is reviewed regularly and if there is clear evidence that the policy has been acted upon within the last year.

Over 50% of UK universities have taken a stance that it is no longer socially or environmentally just to hold investments with fossil fuel extraction industries. UK universities have become part of a global movement to divest [move out of and never invest] in fossil fuels, a culture shift that acknowledges both the importance of cutting finance to fossil fuel projects and revoking the social license that gives the fossil fuel industry a space to dominate energy production and climate policy

Universities will be assessed on all ethical investment criteria even if they do not currently hold investment portfolios. 18 of the universities that have made commitments to never invest in fossil fuels are universities that do not have investments. People & Planet understand that it is possible for these universities to pass and review policy on investment issues before investing becomes an option for them. It is much easier for those universities to pass and review policy now - pre investment - rather than wait to the point at which funds have become available, have been invested, and then require a divestment process.





Ethical Investment Policy

1a. Does the institution have an active, robust and publicly available ethical investment policy reported on at senior level?

Score 10%


• People & Planet will look for the policy on the university website

• The policy should apply to the full scope of institution’s investments or be integrated within any other investment policy 7%

• The policy should be clearly signed off at a senior level and there should be evidence within the policy itself that it was last updated/reviewed within the last 5 years. 3%

1b. Specifics within the policy:

Additional scores will be added for each of the following areas included in the policy

Score – maximum 15%

  • The university commits to including student representation on its investment committee(s)/where a university does not have an investment committee, marks will be awarded for student representation on the finance committee(s) and for there to be clear ongoing opportunities for the wider student body and staff community to engage with the policy 10%

  • A commitment to publicly list all investments annually (at minimum, listing what percentage of the fund is invested in different sectors), with a link to or explanation about where that list can be found. This list might take the form of a financial report and/or investment portfolio provided by the university’s fund manager for the most recent financial year. 5%
  • OR If the university does not currently invest, an explanation about where the list would be found in the future. 5%


Commitment to screen out specific sectors:

Commitment to screen out specific sectors from investments over which the university can be reasonably assumed to have control. This would include investments into companies managed by the institution itself and the guidance provided to external fund managers investing on their behalf, but exclude the investments of external pension scheme managers that the university contributes to:

Maximum 50%


  • Fossil fuel companies

    Fossil fuel companies: partial commitment (i.e. coal and tar-sands) 5%


    Fossil fuel companies: full commitment to screen out all fossil fuel companies 35%


  • Arms companies

    Arms companies partial commitment (i.e. controversial weapons or sales to regimes) 5%


    Arms companies: full commitment to screen out all arm companies 10%



  • Companies in violation of international law

    Commitment to screen out corporations complicit in the violation of international law 5%


3. Reinvesting divested funds:

Maximum 10%

  • Commitment to reinvest in low-carbon / renewable energy companies or funds 5%
  • OR Commitment to directly reinvest in community renewable energy and/or renewable energy projects on campus 10%


• If the university employs a third party fund manager it is still required to have its own ethical investment policy statement. The ethical investment policy of a fund manager will not score points.

• If the policy is new, People & Planet will find evidence confirming the intended reporting structure and name, position and contact details of the responsible staff member.

• The policy must include specific exclusions around fossil fuel investments to be able to score in the reinvestment categories above. I.e. if there is no divestment related exclusion, then there can be no reinvestment points as former is a prerequisite for the latter.


Ethical Banking

4a. Does the institution have a robust and publicly available ethical banking policy reported on at senior level?

Score 5%


  • People & Planet will look for the policy on the university website.

  • The policy must apply to the full scope of services provided by banking institutions to the university, including but not limited to loan services, holding cash, deposit facilities, the provision of chip and pin and payment processing services.

  • And that the policy applies to the presence of banking institution facilities and/or services within university-run and/or university-owned property, including but not limited to bank branches and ATMs

  • And that the policy is clearly signed off at a senior level of the university and within the last 5 years.

4b. Does the policy exclude banks financing fossil fuels?

Score 5%

  • The University commits not to have dealings (as outlined in 4a) with any of the top 60 largest fossil fuel funding banks internationally. 3%
    - The definition of top 60 largest fossil fuel funding banks internationally that People & Planet accepts is the yearly ‘Banking on Climate Chaos’ report by Rainforest Action Network. https://www.ran.org/wp-content/uploads/2021/03/Banking-on-Climate-Chaos-2021.pdf

  • OR The University commits to have dealings (as outlined in 2a) only with banks that have an active policy to explicitly exclude finance for fossil fuel companies and projects. 5%


Transparency and accountability


5. The University website collates information in one place about investment practices and procedures in such a way that facilitates greater transparency and access to information for students, staff and the general public.

Maximum 5%

1% will be awarded for each of the following being easily accessed through a clearly identifiable section of the university website:
- Ethical Investment Policy.
- Annual list of investments.
- List of committee members that oversee investments.
- Meeting minutes that provide updates on investment policy reviews and divestment/investment status if relevant.
- Ethical banking policy.


  • If any of the information requires presence/already exists on another part of the university website, way finding links to the correct pages should be provided. E.g. “The list of committee members that oversee investments can be found on the governance pages of the university website here (with link embedded).”