Image Credit: US Air Force
An investigation by Nouse has lifted the lid on the practices of one of the country’s only student-run equity portfolios, revealing its investment decisions.
The Griff Fund, which manages part of the University of York’s endowment fund, was founded in 2013 and was the first student group of its kind in the UK. A freedom of information request has found that the Fund has invested in notable organisations including household names like Starbucks and PepsiCo. Moreover, the group has made further striking investments in prominent companies in the mining, oil, and arms trades.
The Fund started with a seed capital of £10 000 in 2013, donated by York alumnus and CIO of Fixed Interest & Credit at First State Investments, Paul Griffiths, who remains the groups sole do - nor, although it is looking to ac - quire further donors.
The list of investments from last financial year acquired by Nouse lists oil giants, Tullow Oil and Transocean, the latter of which was fined $1.4 billion by the US Government when its oil rig in the Gulf of Mexico exploded, killing 11 workers and causing one of the biggest environmental disasters in US history. The Fund claims, however, that it has since divested of these companies, citing a desire to enforce more ethical investment practices.
Notwithstanding the recent divestments in oil, the Fund remains invested in American conglomerate Lockheed Martin, one of t h e world’s lead - ing arms manufacturers. The company, which has over 100 000 employees worldwide, is the world’s largest defence contractor. It is currently leading the development of the revolutionary F-35B short take-off and vertical-landing fighter jet, to become a critical part of the US Air Force and Royal Air Force.
The Fund says it is aware of the potential moral objections to such an investment. Although investments by universities in such enterprises are not uncommon, students making such investments is unusual. A spokesperson for the group said: “We are not naïve to some of the business that Lockheed conducts, however, one does not always invest in a company due to its foremost revenue streams. For example, many investors see McDonald's as a secure way to invest in real estate, rather than a fast food chain.
"In the same way, we were interested in the rapidly growing industry of privately-developed space exploration. Lockheed Martin is, in our opinion, the best way to gain exposure to this trend. Our investment in Lockheed Martin is not a reflection of any political beliefs we as a fund hold, rather it is the only viable option that allowed us exposure to this trend.”
The group styles itself as an educational organisation, where students can develop their finance skills in cooperation with the University. Although the Fund hosts a stall at Freshers’ Fair, it is not a YUSU-ratified society and, as such, it follows internal rules. All students are welcome to apply to join the group, but positions within the group are decided by internal interview processes. Despite this, the group emphasises that investment decisions are made collaboratively with all members able to contribute to the direction of the Fund.