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New York, New York: Another Divestment Win

By staff - Fossil Free California, January 25, 2021

Three of New York City’s five pension funds announced they are divesting a total of $4 billion from fossil fuels following a six year campaign led by a multiracial, multigenerational coalition. Pension funds for teachers, school administrators, and civil servants voted to divest from fossil fuels. Police and fire department pension funds have not yet voted to divest. Said NYC Mayor Bill de Blasio, “Divestment is a bold investment in our children and grandchildren, and our planet.” The divestment of the $239 billion NYC pension funds is the largest municipal pension fund divestment to date.

The New York City commitment joins last month’s pledge by NY State Comptroller Tom Di Napoli to divest the $226 billion state Common Retirement Fund from the riskiest fossil fuel companies, and fully decarbonize the portfolio by 2040, a decade earlier than the “net-zero by 2050” pledges made by other funds such as California’s CalPERS.

After a 2018 divestment commitment made by Mayor de Blasio and NYC Comptroller Scott Stringer, a coalition of retirees, youth activists, and union representatives held countless meetings with city officials and staff, scoring interim successes on related projects such as stopping the Williams Pipeline, getting a ban on all new fossil fuel projects in NYC, and doubling NYC investments in climate solutions. Youth and elders from New York Communities for Change, People’s Climate Movement NY, DivestNY, 350NYC, 350.org, and a host of other organizations celebrated every success and focused on growing a stronger and stronger coalition. New York City coupled its 2018 commitment to divest with a string of lawsuits against Big Oil – see “Divest and Sue”.

“It is right and just that, in the midst of the deadly pandemic, our beloved NYC is choosing life over death and acting on its commitment to divest the pension funds from fossil fuel investments,” said Marilyn Vasta, for People’s Climate Movement NY. “For too long we have financially supported the polluters that harm us; it is time to make polluters pay as we invest in a just transition to renewable energy. Although it has taken almost a decade, from small living room meetings to a city-wide cry for divestment, the People’s Climate Movement-NY proudly stands today with Comptroller Stringer and Mayor de Blasio, and applaud them for taking this positive step towards a fossil free future.”

Divestment is a strong remedy for the social and environmental harms caused by continued fossil fuel use and investment, but the urgency of the climate crisis demands this kind of bold climate action. Divestment should be part of every engagement strategy, and it is the best tool for removing climate-related financial risk from a portfolio. 

New York State and New York City are showing us the way: now CalPERS, CalSTRS, and California’s 20 municipal pension funds need to follow suit. To catch a glimpse of some of the New York climate activists that made this victory possible, check out this video of our coalition panel called “Youth and Elders Unite for Climate-Safe Pensions” that aired during last summer’s “Earth Day Live”.

CalPERS Continues to Invest in Coal

By Robert Dam and Vanessa Warheit - Fossil Free California, September 2020

This 14-page report shows that CalPERS continues to hold millions in coal producers that make the majority of their revenue from thermal coal. In fact, CalPERS even increased its investments in Exxaro, a company that qualified for divestment in 2017 but was retained by CalPERS because they said they were investing more in green energy. But Exxaro’s modest clean energy initiatives are dwarfed by its current coal operations in South Africa, and by its intent to seek permits for a six-fold expansion of its coal mining, which could be a tipping point for the climate.

In recognition of coal’s outsized contribution to human-caused climate change, in 2015 California passed a law – SB 185 – requiring CalPERS and CalSTRS to divest from companies making 50% or more of their revenue from the mining of thermal coal.  A 50% share of revenue sets a very high bar that can be reached by only the small number of “pure-play” coal mining companies that remain in business.  Many investors, including BlackRock and the State of New York, define a “coal company” with a much lower threshold of 25% or even 10%.

If CalPERS coal holdings are analyzed more broadly, using the criteria of the Global Coal Exit List, it’s clear that CalPERS holds billions in coal – coal mining companies, coal-fired utilities, coal distribution and services, and large diversified companies with substantial coal operations. Instead of winding down its investments in coal, which was the intent of SB 185, CalPERS actually increased investments in coal by $1.5 billion dollars between 2018 and 2019, for a total of $6.5 billion throughout the whole coal value chain. 

CalPERS’ coal exclusion policy is weak compared to those of many other institutional investors. By failing to set a strong coal exclusion policy, CalPERS has already lost billions in absolute value on its coal investments, and the sector continues to decline. As New York State’s Tom DiNapoli said when he decided to divest 22 thermal coal companies, “After a thorough assessment, the fund has divested from 22 thermal coal mining companies that are not prepared to thrive, or even survive, in the low-carbon economy.”

Download (PDF).

Public Finance for the Future We Want (Lavinia Steinfort and Satoko Kishimoto)

By Lavinia Steinfort and Satoko Kishimoto (editors) - Transnational Institute, June 2019

Do you wish to see regenerative, equitable and democratic economies, built with collective power? We believe it is not only necessary but also very possible.Today’s economic system, fueled by an extractivist logic and prone to crises, has reignited and enflamed old monsters of racism, misogyny and other forms of fear and hate. Economic alternatives are needed now more than ever.

This book is about financial alternatives, drawn from real-world examples. It highlights the kinds of models that could become the new normal, building the basis for a democratically organized and life-sustaining future.Before the 2008 global financial crisis, the mantra was ‘there is no alter-native’ to the extractive economic model that has fostered excessive inequality and ecological destruction. Post-crisis, big banks were rescued and the blame misdirected to public spending.

This justified evermore harsh austerity measures, reinforcing the story that the public sector must rely on private finance to solve these ‘collaterals’.More than 10 years later, we know that private finance has not only failed to address these problems, it has intensified them. Civil society needs to unite behind systemic solutions before another financial bubble bursts.

Read the report (PDF).

CalPERS, CalSTRS, UC Invested in Dakota Access Pipeline Despite Pledges of Sustainability

By Darwin Bond-Graham - East Bay Express, December20, 2016

Last Monday, two-dozen activists chanted, sang, and drummed outside Wells Fargo' San Francisco headquarters to demand the bank stop financing the Dakota Access Pipeline. Wells Fargo has drawn criticism for its central role in raising funds for the pipeline's construction. But banks aren't the only Bay Area institutions that stand to profit if the pipeline is completed.

The University of California and the state's two largest public pension systems, CalPERS and CalSTRS, are also invested in Energy Transfer Partners and the oil company Sunoco, which recently merged with ETP in a deal worth $20 billion. ETP and Sunoco are the companies building the Dakota pipeline.

According to the UC's most recent annual report for its employee-retirement system, it has $3.1 million invested in Energy Transfer Partners bonds.

CalPERS, the state's giant public-employee retirement system, has invested $57 million in Energy Transfer Partners. The retirement system also owns Sunoco bonds worth $1.8 million.

And the California State Teachers Retirement System, or CalSTRS, owns $34 million in Energy Transfer Partners bonds and another $12.8 million in Sunoco bonds.

"By buying these corporate bonds they're betting on the success of the pipeline," said Janet Cox of Fossil Free California, a group that advocates divesting from fossil fuels.

Teachers, students, and public employees have rallied for years to divest retirement funds and endowments from oil, gas, and coal. Results have been slow and mixed.

Corporate America Has a Lot to Answer For

A speech given by Jim Hard, director of SEIU Local 1000, AFL-CIO at the Headwaters Rally September 14, 1997

Sisters and Brothers; all my relations; hello! Thanks to the organizers for inviting me to this great event. But I hope that this is the last year that we have to come here to demonstrate, because by next year, we should be celebrating that the Headwaters has been protected, and we can return to admire that which we have preserved. I bring you greetings from the Service Employees International Union (SEIU) Local 1000 (AFL-CIO), The California State Employees Association, representing over 86,000 state workers in California. And we've never seen the Headwaters Forest; were not allowed to visit this national treasure. Although I understand that some of you have.

I live in Sacramento, where our daily newspaper sometimes has articles about the confusing negotiations about the fate of Headwaters, but I've never seen anything about the necessity for its preservation. I haven't seen any TV programs about the Headwaters, because the idea of saving the Headwaters doesn't have a corporate sponsor.

And today, I hope our numbers will put the Headwaters issue in the newspapers and on the TV screens across this country. It's important that you and I are here today. As in so many working class issues and I consider protecting the environment a working class issue--our strength is in our numbers. Its our numbers versus corporate legal staff. It's us against corporate media. It's us against corporate greed. Our adversaries are powerful, but history shows they can be defeated.

In the early 70s, before coming up here and attending Humboldt State University (HSU), I was an organizer for the United Farm Workers (UFW). Then as now we had a just cause and powerful corporate adversaries. We fought on many fronts and we prevailed. And the farm workers won their right to organize. The fight to save the Headwaters is being fought on many fronts. Today in this field, but also with direct action up in the woods. In the courts and by all of us wherever we happen to be. My union recently took up the issue of Headwaters and MAXXAM Corporation at our executive board meeting. We passed a motion requesting the [California] Public Employees Retirement System (CalPERS), the largest retirement system in the United States, to divest their 318,000 shares from MAXXAM contingent upon results of Headwaters negotiations. The State Teachers Retirement Fund has already done that.

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