Money with a Conscience
Socially Responsible Investing with TIAA-CREF
More and more investors are equally motivated to make money and encourage a positive change in the world and their local communities. In fact, socially responsible investing (SRI) accounts for an estimated $3.07 trillion out of $25.2 trillion in the current U.S. investment marketplace.1 TIAA-CREF has a longstanding commitment to encouraging companies in its SRI portfolios to adopt practices that benefit the environment, human rights and economic development, while fostering corporate responsibility and performance-based executive compensation practices.
TIAA-CREF’s Socially Responsible Investing (SRI) Program
TIAA-CREF adopted socially responsible investing in the early 1970s in response to strong interest from our clients in higher education and other nonprofit sectors. Today, our program supports the dual goals of influencing positive social change and investing for retirement objectives through:
- Social screening. We pursue competitive returns aligned with investors' values through comprehensively screened investment options that give special consideration to companies’ environmental, social and governance (ESG) records.2 TIAA-CREF is one of the largest institutional investors of global socially screened assets with approximately $12 billion in assets under management as of December 31, 2011. Established March 1, 1990, our CREF Social Choice Account, a variable annuity account for retirement plan participants, is our largest and oldest socially screened product. The Account seeks a favorable long-term rate of return that reflects the investment performance of the financial markets while giving special consideration to a range of social criteria. As of March 31, 2012, this account had an average annual return of 5.75% for one year, 3.42% for five years and 5.03% for 10 years,3 compared to 5.95%, 3.51% and 5.08% respectively for its benchmark CREF Social Choice Composite Index.
- Community investing. We work toward delivering a combination of competitive returns and positive social impact through targeted investment programs.4 One example is TIAA-CREF’s Community Bank Deposit Program, which promotes economic development in low-income, economically distressed areas that are often ignored by mainstream financial institutions. Our program provides a stable, competitively priced funding source to several leading U.S. community development banks that operate in underserved areas. As of March 2012, we had approximately $18.8 million placed in FDIC-insured deposits across four community banks. And as the economy continues to recover, we expect this program to expand.
- Shareholder advocacy and corporate governance. TIAA-CREF promotes long-term investment value by exercising our shareholder rights to influence the ESG policies of the companies in which we invest across the entire TIAA-CREF portfolio — not just in our socially screened offerings. TIAA-CREF’s Policy Statement on Corporate Governance (PDF) describes our proxy voting guidelines and our perspective on best practices in corporate governance, including social and environmental issues.
To learn more about socially responsible investing with TIAA-CREF, call 800 842-2252 or contact us at your convenience. Or, if you have an Advisory Team assigned to you, contact them directly.
1 The U.S. Sustainable Investment Forum, Sustainable and Responsible Investing Facts, 2012.
2 Because social screens may exclude some investments, such investment strategies may not be able to take advantage of the same opportunities or market trends as strategies that do not use these criteria.
3 The performance data quoted represents past performance, and is no guarantee of future results. Your returns and the principal value of your investment will fluctuate so that your accumulation units, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance quoted above. For current performance information, including performance to the most recent month-end, please visit tiaa-cref.org.
The risks that the account is subject to include the risk of socially screened investing, market risk, company risk, small-cap risk, income volatility risk, credit risk, interest-rate risk, prepayment risk, extension risk and foreign investment risks.
4 These programs are currently funded through the TIAA General Account, and through targeted investments in the fixed-income portion of the CREF Social Choice Account, a variable annuity. The TIAA General Account is an insurance company account and is not an investment or security offering available to the public.
Investing in securities is subject to risks, including loss of principal, which are described in the prospectuses. Please read carefully before investing.
Investment, insurance and annuity products are not FDIC insured, are not bank guaranteed, are not deposits, are not insured by any federal government agency, are not a condition to any banking service or activity, and may lose value.