CalPERS—the retirement system for almost 2 million public employees in California—has announced that it is leading an effort to pull together a global investor alliance who will agree to Paris 2° with CalPERS representing the US by proxy in the newly-formed, UN-sponsored “Global Climate 100.”
CalPERS sent out a press release Monday entitled “Trump’s out, but CalPERS steps up on climate change,” which details the plan.
When President Trump pulled the US out of the Paris agreement with the statement: “I was elected to represent the citizens of Pittsburgh, not Paris,” CalPERS leadership felt compelled to act.
Starting last September, a number of UN groups, large investors, and the Global Investor Coalition met in order to plot a course. The meeting was co-chaired by state Treasurer John Chiang, a CalPERS board member, and Scott Stringer of the New York City pension system.
Anne Simpson, CalPERS sustainable investments director, reportedly made a presentation on the plan to the CalPERS board last week.
“CalPERS has volunteered to be the investor for the United States, which the others have agreed,” Simpson told the board.
She said organizing the alliance, “I think we are nearly there,” is being done with “some delicacy and care and courtesy” and with input and ideas from a number of organizations and regional investment networks.
If the plan is ready for the United Nations-supported Principles for Responsible Investment in Person meeting next month, she said, the alliance can issue a call for other investors to join the coalition, something never tried before.
The stated goal of the “Global Climate 100” initiative is to meet the Paris climate accord target of reducing carbon emissions by 80 percent by 2050, which was laid out in a CalPERS presentation last April at an environmental/investor advocacy conference.
According to Simpson, one inspiration for this approach was the result of a project in 2014 “to measure the carbon footprint of investments, [which determined] that 80 companies among its 10,000 holdings were responsible for 50 percent of the carbon emissions.”
As one of the world’s largest holder of shares, CalPERS carries considerable clout and intends to use in concert with other large shareholding entities.
An analysis of CalPERS divestments dating back to apartheid South Africa in 1986 have reportedly resulted in a total loss of almost $8 billion, and that report does not include a recent bill by Senate Pro Tem Kevin de Leon, (D-Los Angeles), requiring divestiture from coal companies.
Sacramento Bee reports that CalPERS sold most of its coal holdings at a tremendous loss under the Obama Administration. Coal shares have recovered considerably with Peabody up 15 times from its all-time low in April 2016, when it declared bankruptcy.
One goal of this new global investor alliance, according to CalPERS, is to limit divestiture as a last resort, something which might be good news to frustrated CalPERS pensioners.
The only public comment at the hearing came from Jason Perez, president of the Corona Police Officers Association, who said he thought much of the discussion, though laudable, was contrary to the state constitution that says a retirement board’s first duty is to the beneficiaries.
“Please, please, I beg you, just make us money,” Perez told the CalPERS board. “Don’t try to change the world, right. Just make us money. I’m going to retire in 10 years, Lord willing, and live a long and happy life.”
CalPERS manages almost $330 Billion in investments and returned barely just over 11%—up from less than 1% last year—thanks a booming stock market since Trump’s election.
Tim Donnelly is a former California State Assemblyman and Author, currently on a book tour for his new book: Patriot Not Politician: Win or Go Homeless. He also ran for governor in 2014.
FaceBook: https://www.facebook.com/tim.donnelly.12/
Twitter: @PatriotNotPol
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