CalSTRS

By Zara Ashan, Clair Brown, Lena Gonzalez, Eddie Iasaacs, Steve Ongerth, and Carlos Davidson - Fossil Free California, January 31, 2023

By various - Fossil Free California, November 22, 2022

By Nick Cunningham - DeSmog, June 28, 2022

The California legislature was close to passing a bill that would require the state’s two massive pension funds to divest from fossil fuels, but on June 21 the legislation was killed by one Democratic assemblyman who has accepted tens of thousands of dollars in campaign contributions from the energy industry.

Senate Bill 1173 would have required the California Public Employees’ Retirement System (CalPERS) and the California State Teachers’ Retirement System (CalSTRS), the two largest public pension funds in the country, to divest from fossil fuels. CalPERS and CalSTRS, which manage pensions for state employees and teachers, together hold more than $9 billion in fossil fuel investments.

The global divestment movement now claims that more than 1,500 institutions have divested from fossil fuels, representing more than $40 trillion in value. New York and Maine have also committed to phasing out fossil fuel investments from their public pensions.

But because of the size of the two California pension funds, their divestment from fossil fuels would be a significant achievement for the global movement. The call comes as the state continues to suffer from long-term drought and catastrophic wildfires that are worsening with climate change. Activists say that the state cannot claim to be a leader on climate action while maintaining billions of dollars’ worth of investments in the fossil fuel industry.

Senate Bill 1173 would have required the pension funds to divest by 2027, and the legislation had the support of the California Faculty Association, the California Federation of Teachers, associations representing higher education faculty, and roughly 150 environmental and activist organizations. 

However, the American Legislative Exchange Council (ALEC), a corporate-backed front group with ties to the oil industry, opposed the bill, warning that divesting from fossil fuels would put public sector pensions in financial jeopardy.

The bill already passed the state senate, and still needed to pass in the state assembly, where Democrats command a large majority. But the bill needed to move through the Committee on Public Employment and Retirement, where Democrat Jim Cooper (Sacramento) is Chairman. 

On June 21, Cooper decided to let the bill die in committee, refusing to even bring it up for a hearing. Environmental groups denounced the “one-man veto.” Cooper has accepted more than $36,000 from the oil industry and other polluters over the past two years, including donations from Chevron and ExxonMobil, according to data compiled by Sierra Club, which called him a “Democratic favorite of the oil and gas industry.” 

“Jim Cooper just decided to continue investing public money in the unequal suffering of my community,” said Lizbeth Ibarra, an activist with Youth vs. Apocalypse, a California-based climate justice organization.

By Brett Wilkins - Common Dreams, June 21, 2022

"This defeat is just a temporary setback," said one campaigner. "We will organize to come back stronger to make our demand for fossil fuel divestment heard because fossil fuel companies are driving us toward unimaginable disaster."

Climate, environmental, and social justice advocates on Tuesday condemned the decision by a Democratic California lawmaker to kill proposed legislation that would require two of the state's leading pension funds to divest from the fossil fuel industry. 

"Today amidst a historic mega-drought, wildfires, and fossil-fueled public health crises, Assemblymember Jim Cooper, Chair of the Assembly Committee on Public Employment and Retirement, refused to allow Senate Bill 1173, California's Fossil Fuel Divestment Act, to be heard in his committee," Fossil Free California said in a statement. "This one-man veto allows the state's pensions to continue to invest billions from public funds into the fossil fuel industry, for now."

S.B. 1173 would have prohibited the California Public Employees' Retirement System (CalPERS) and the California State Teachers' Retirement System (CalSTRS)—the two largest public pension funds in the United States—from making or renewing investments in fossil fuel companies. The measure would also have required the pensions to liquidate their fossil fuel holdings by 2030. The two funds currently hold an estimated $9 billion in fossil fuel investments.

"This decision is a moral failure that disproportionately impacts young people, Indigenous communities, communities of color, and low-income communities," the coalition asserted. "Climate chaos has already cost California billions in damages and health costs from fossil fuel pollution and climate disasters. Jim Cooper, who has just been elected Sacramento County Sheriff, has reported $36,350 in Big Oil campaign contributions from this election season alone."

State Sen. Lena Gonzalez (D-33) said in a statement that "while I am deeply disappointed that my Senate Bill 1173 was not set for a hearing in the Assembly Committee on Public Employment and Retirement this week, I remain committed to the necessary and ongoing fight against the impacts of climate change on our state, and especially those communities in my district that are disproportionately impacted by the negative effects of the climate crisis."

"Teachers and state employees whose retirement futures are invested by our state's pension funds have long demanded that CalPERS and CalSTRS cease investing their money in fossil fuel companies, and this demand will only grow stronger and louder," she continued.

By Sharon Kelly - DeSmog, June 16, 2022

CalPERS says it needs to hold onto billions in fossil fuel shares in order to push polluters in the right direction – but a new report details a pattern of voting against climate proposals.

Does engaging with oil and gas giants by remaining invested in them – keeping a “seat at the table” – help in the fight against climate change? 

A new report suggests not very much – at least judging by the record of the California Public Employees’ Retirement System (CalPERS).

The report by environmental group Fossil Free California takes the public pension fund to task for its results to date, highlighting its history of pushing “the importance of corporate engagement on climate change” in public statements, while simultaneously voting against climate measures in shareholder meetings.

The report details dozens of votes against climate measures by CalPERS this year — including votes against greenhouse gas reduction targets at Royal Dutch Shell, against reporting and reducing greenhouse gas emissions at BP, and against pushing big banks to get in line with international “net zero by 2050” strategies.

In fact, CalPERS has voted against every climate resolution at major American and Canadian banks so far this year, the report claims.

The report also casts doubt on one of the biggest accomplishments of CalPERS’ engagement strategy – the election of several new members to ExxonMobil’s board of directors last year, nominated by the activist investment firm Engine No. 1. The report faults Engine No. 1’s directors for voting against two recent proposals to set greenhouse gas targets that would account for the pollution caused by the fossil fuels ExxonMobil sells, and to produce a report on low-carbon business plans.

“Despite their best efforts, CalPERS and [California’s other major pension fund] CalSTRS have failed to persuade fossil fuel companies to reduce their greenhouse gas emissions, increase their renewable energy production, or transition from fossil fuels to renewable energy,” the report concludes. “By opposing climate proposals at the very companies they claim to influence, the funds’ shareholder activism is not only ineffective – it’s undermining climate action.” 

California lawmakers are currently considering a bill that would spur these pension funds, which invest retirement funds for state employees – including many, like the state’s firefighters, who are today on the front lines of the climate crisis – to drop their investments in fossil fuel producers.

The fund has an estimated $7.4 billion worth of fossil fuel investments that the bill would require them to shed. In April, its board voted to oppose that law, arguing that it would lose its “seat at the table,” only to be replaced by investors that “may not have the same interest in long-term sustainability as CalPERS”..

CalPERS declined comment on Fossil Free California’s new report.

By Sharon Kelly - DeSmog, May 13, 2022

CalPERS and CalSTRS, which oppose fossil fuel divestment legislation, have “wildly exaggerated” divestment costs, according to Fossil Free California’s latest report.

A newly published report by Fossil Free California finds California’s pension fund managers are circulating divestment “misinformation” by exaggerating the costs involved in shedding their fossil fuel investments in documents prepared for state lawmakers.

California lawmakers are currently considering Senate Bill 1173 (SB-1173), California’s Fossil Fuel Divestment Act, which would require the California Public Employees’ Retirement System (CalPERS) and the California State Teachers’ Retirement System (CalSTRS), to stop investing in fossil fuels before the decade is out. The move would impact billions of dollars currently invested in oil, gas, or coal on behalf of California’s teachers, firefighters, and other public employees.

The report titled “Hyperbole in the Hearings” found that the pension “funds have wildly exaggerated losses from past divestments” like those involving tobacco, firearms, and some forms of coal. It concludes that CalPERS and CalSTRS estimates for costs associated with fossil fuel divestment are also exaggerated.

Extraordinary sums of money, invested on behalf of California’s public employees and teachers, are on the line. The two pension funds have estimated holdings of $7.4 billion and $4.1 billion respectively in fossil fuel investments that would need to be divested if the law went into effect. 

It's time to stop using state employees' retirement savings to finance Big Oil.#SB1173 would divest @CalPERS & @CalSTRS from fossil fuels once & for all—but we need your help!

Click here to call, write, or schedule a meeting with your representative: https://t.co/UM5Nr2RCk5 pic.twitter.com/3ogICu0oad

— Climate Safe Pensions Network (@ClimatePensions) May 13, 2022

Resolution Urging Support of SB 1173 (Gonzalez) Fossil Fuel Divestment Act
Adopted by the ILWU NCDC – March 26, 2022

WHEREAS, climate change, through rising sea levels, drought, heat waves, and increased wildfires is already negatively affecting human wellbeing, ecosystems and biodiversity; and 

WHEREAS, climate change is an issue of environmental justice, disproportionately impacting Indigenous communities, communities of color, and low income communities due to historical oppression, inequity of power, and lack of access to resources for prevention and relief; and

WHEREAS, the World Economic Forum recognizes the climate crisis as “a child-rights crisis” and says “the adverse weather events caused by a warming planet affect children first and worst”; and

WHEREAS, an analysis from the Harvard T.H. Chan School of Public Health indicates that the effects of heat, wildfires, storms, floods, and droughts can negatively affect both the physical and mental health of children. The negative effects on children’s physical health from the burning of fossil fuels and climate change include impacts on allergies, asthma, brain development, low birth weight, and preterm birth; and

WHEREAS, the American Academy of Pediatrics recognizes that the physical and mental impacts of climate change “not only directly threaten the lives and safety of children, they put them at risk of mental health problems—and can also cause lasting effects when they destroy their communities and their schools”; and

WHEREAS, a review of the psychological effects of climate change on children finds that “effects of climate change place children at risk of mental health consequences including PTSD, depression, anxiety, phobias, sleep disorders, attachment disorders, and substance abuse. These in turn can lead to problems with emotion regulation, cognition, learning, behavior, language development, and academic performance”; and 

WHEREAS, independent studies by financial consulting firms Blackrock and Meketa found divestment reduces risk, and improves, not weakens, investment returns; and

WHEREAS, a Corporate Knights study found if CalPERS and CalSTRS had divested in 2010 they would have gained $11.9 and $5.5 billion respectively by 2019; and 

WHEREAS, the International Panel on Climate Change concluded in 2018 that we have 12 years to make dramatic cuts in the use of fossil fuels (coal, oil, gas and tar sands) if we are to keep warming to 1.5o C and avoid more catastrophic change; and

WHEREAS, the fossil fuel industry is the single most powerful obstacle to addressing climate change, using their immense lobbying power in Washington D.C. and Sacramento to block climate legislation; and 

WHEREAS, fossil fuel companies' own scientists knew their products were causing climate change, but the companies kept it secret; and 

WHEREAS, to effectively address climate change, most fossil fuel reserves must remain in the ground, never to be used. This makes fossil fuel stocks a risky investment; and

WHEREAS, divestment in specific segments or business operations by CalPERS and CalSTRS is already standard practice and is specifically allowed by the California Constitution; and

WHEREAS, divestment means selling directly held or commingled assets including fossil fuel public equities and corporate bonds; and

WHEREAS, the California Climate Jobs Plan provides a comprehensive roadmap for decarbonization and just transition from a fossil fuel based economy; and

WHEREAS, The ILWU Northern California District Council has endorsed the California Climate Jobs Plan (in February 2022);

THEREFORE LET IT BE RESOLVED, that the ILWU NCDC strongly supports SB 1173 (Gonzalez) the fossil fuel divestment act. And upon passage, a copy of this resolution will be sent to Senator Lena Gonzalez’s office requesting that the ILWU NCDC be listed as an official supporter of the bill.

By staff - Climate Safe Pensions, December 2021

A first-of-its-kind report ... from Climate Safe Pensions Network and Stand.earth reveals that just 14 pension and permanent funds finance fossil fuels to the tune of $81.6 billion.The report shows a comprehensive accounting of the fossil fuel exposure of 14 pension funds in one report from Climate Safe Pensions Network and Stand.earth reveals that just 14 U.S. public pension funds are the quiet culprits of climate chaos: with $81.6 billion invested in coal, oil, and gas.

With over $46 trillion in assets worldwide, pension funds are among the largest institutional investors in fossil fuels. These investments have dangerously underperformed the rest of the market, making public pensions’ fossil fuels investments inherently risky.

Pension funds’ financial influence make them a force to reckon with in the battle to confront, slow and mitigate climate change. Pension fund decision-makers must take climate protection seriously — not only for their financial well-being, but also for the well-being of their millions members.

With 10 years of data, there’s hard evidence that divestment is a winning financial strategy. The fastest way for pensions to address climate change is to divest fossil fuel holdings and invest in just and equitable climate solutions.

Read the text (PDF).

By Peter Menchini - Maya Media, September 25, 2021

Youth vs Apocalypse: #UPROOTtheSYSTEM - 4K from Peter Menchini – Maya Media on Vimeo.