The Chancellor, David Thodey AO, wrote to all staff updating them on the University’s response to the Report of the Investment Policies Review Working Group.

Dear colleagues,  

On 1 July I wrote to all staff to share the report and recommendations of the Investment Policies Review Working Group (IPRWG), which was established in September 2024 to conduct an independent review of the position of defence- and security-related industries in the University’s Investment Policy and the University’s Integrated ESG Framework to ensure they reflect the University’s commitment to human rights. 

Over the last six months, Senate and University leadership has been carefully considering the report and its recommendations, and I am writing to let you know that we have accepted those recommendations in principle.  

The University is strongly committed to respecting human rights and to ensuring that our activities do not cause or contribute to adverse human rights impacts. We also recognise the value of defence- and security-related research and partnerships, and the critical contribution universities make to our national security through this work. We remain resoundingly committed to lawful open inquiry including in teaching and research in defence- and security-related areas.  

Our response

Human rights statement 

As an institution founded for public good, respecting human rights is at the heart of our vision for teaching and research that transforms people’s lives. To reflect this commitment, we will develop and publish an overarching human rights statement and work towards integrating our commitment across the University.  

A selective approach to investment 

After carefully considering the IPRWG’s recommendations, the University believes it can develop and implement an effective, selective approach to investment, which upholds our commitment to human rights and Australian and international humanitarian law, while supporting defence and national security capacity building as important and legitimate endeavours for a research-intensive Australian university. 

The University welcomes the IPRWG’s recommendations to strengthen transparency and accountability in our investment strategy. Consistent with the University’s commitment to human rights, we will exclude future direct and publicly traded investments in companies sanctioned by countries in the Five Eyes intelligence alliance and in companies involved in weapons banned or restricted under international conventions to which Australia is party. 

We will review existing holdings for divestment and work towards policy alignment with our private funds. 

Strengthening human rights due diligence 

Over the next two years, we will also work towards strengthening our human rights due diligence across our research, education, philanthropy, sponsorship, partnerships and procurement activities. This work will be undertaken in consultation with the Academic Board, defence and human rights experts, and other relevant stakeholders.  

Once again, I thank Dr Simon Longstaff AO, who chaired the working group, and the members for sharing their deep expertise in human rights, investments, defence and national security. 

I also thank all those who made submissions to the review. I look forward to continuing to engage openly and constructively with the University community and other stakeholders as we implement the University’s response to the review. 

Kind regards,  

David 

David Thodey AO 

Chancellor 

Recommendations and the University’s response 

Recommendation 1  

The University of Sydney develop, adopt and publish an overarching statement of its human rights commitment. Such a statement should provide the foundation on which more specific policies are built. 

Response: Agree 

The University will develop and publish an overarching human rights statement, reflecting our commitment to respecting human rights and our approach to identifying, mitigating and remediating adverse human rights impacts, consistent with international law and the UN Guiding Principles on Business and Human Rights. 

Over the next two years, we will work towards embedding this commitment to ensure coherence and consistency, where required, across our policies, processes and decision-making, responding to any identified gaps in our due diligence of human rights. 

Recommendation 2  

At the earliest opportunity when practicable, The University of Sydney:  

– 2.1. unwind all of its investments and not make any future investments, in 

    – 2.1.1. direct equity holdings in assets that derive revenue from items listed on DSGL Part One, 

    – 2.1.2 publicly traded investment instruments that derive revenue from items listed on DSGL Part One,  

– 2.2 preserve its current investments in private funds until maturity  

– 2.3 actively monitor the composition of assets, held by private investment vehicles, to determine which, if any, derive revenue from items listed on DSGL Part One and to ensure, to the extent possible, that there is not significant investment into such assets.  

– 2.4. publish annually a list of all assets identified under 2.3 (above)  

– 2.5. actively engage with private investment managers to affirm the University’s commitment to human rights and its preference for investments that accord with that commitment. 

Response: Agree in principle 

The University agrees in principle with the IPRWG’s recommendation to strengthen our investment strategy in line with our commitment on human rights. After careful consideration, the University has not accepted the IPRWG's recommendations that it use the Defence Strategic Goods List (DSGL) Part 1 as the basis for making divestment and investment decisions, and for reporting purposes. 

The University’s Investment Policy currently excludes investments in entities directly involved in the manufacture of cluster munitions. We will update this policy to extend this exclusion to include investments in direct equity holdings and publicly traded investment instruments that are in violation of international law, including those sanctioned by countries in the Five Eyes intelligence alliance (Australia, United States of America, United Kingdom, New Zealand and Canada) or involved in weapons that are banned or restricted under all international treaties to which Australia is party. This includes the Chemical Weapons Convention (CWC), Biological Weapons Convention (BWC), Anti-Personnel Mine Ban Convention, Convention on Certain Conventional Weapons, and the Treaty on the Non-Proliferation of Nuclear Weapons (NPT). Existing direct and publicly traded investments will be reviewed and assessed against this policy with the view to divest from these holdings over the forward years. 

The University will continue to engage proactively with public and private equity fund managers to address ESG concerns, including human rights, and work towards consistency with our revised policy position.  

Recommendation 3  

The University of Sydney’s Chief Investment Officer provide an annual attestation, to the University’s Senate, as to the progress of divestment and the ongoing state of the portfolio in relation to such investments. 

Response: Agree 

The University’s Chief Investment Officer will make an annual report to Senate on the University’s efforts to identify and address adverse human rights impacts in its investments, including the progress of divestment. The University’s efforts to demonstrate our commitment to human rights, including implementation of our Investment Policy and Integrated ESG Framework, will also be reflected in our bi-annual public reporting to the United Nations as a member of the UN Global Compact. 

Recommendation 4  

The University of Sydney’s Chief Investment Officer provide an annual attestation, to the University’s Senate, as to how The University of Sydney’s investments conform with its human rights commitments. 

Response: Agree 

The University’s Chief Investment Officer will make an annual report to Senate on the University’s efforts to identify and address adverse human rights impacts in its investments. The University’s efforts to demonstrate our commitment to human rights, including implementation of our Investment Policy and Integrated ESG Framework, will also be reflected in our bi-annual public report to the UN Global Compact. 

Recommendation 5  

The University of Sydney put in place an active review process, rather than simply adopting a policy, that focuses on human rights implications associated with the University of Sydney’s investments, on an ongoing basis. 

Response: Agree 

The University will undertake screening of its investments (quarterly for public funds and annually for private funds) , in line with its updated Investment Policy, to ensure they are consistent with our commitment to respecting human rights. The University will reflect our human rights commitment in the selection and evaluation of investment fund managers and engage with managers, at least annually, to identify and address actual and potential adverse human rights impacts.