Current:Home > NewsNew York’s Giant Pension Fund Doubles Climate-Smart Investment -FutureWise Finance
New York’s Giant Pension Fund Doubles Climate-Smart Investment
View
Date:2025-04-18 05:58:57
Stay informed about the latest climate, energy and environmental justice news by email. Sign up for the ICN newsletter.
America’s third-largest public pension fund is ramping up its climate-savvy investments, New York State Comptroller Thomas P. DiNapoli announced to global finance leaders on Wednesday.
The fund, a huge and influential investor, plans to double its stake to $4 billion in a portfolio of companies that disclose and seek to lower their emissions of global warming pollution.
“We’ve particularly been concerned about how we can address the issue of climate risk and benefit our portfolio,” DiNapoli said, speaking at the Investor Summit on Climate Risk, where money managers called for investors to face up to the risks of climate change and to accelerate action to fight global warming.
As the summit was underway at the United Nations on Wednesday, the UK Government’s Met Office published an ominous new five-year forecast that adds urgency to the investors’ climate concerns: Annual global temperatures could reach 1.5 degrees Celsius above pre-industrial levels within the next five years, the Met Office warned. The aim of the Paris climate agreement is to prevent warming from getting much beyond that level.
The $2 billion in additional investment DiNapoli announced will go into a low-emissions index fund that New York’s Common Retirement Fund created in 2016. While the low-emissions index fund—which has had an annualized investment return of 16.5 percent—represents just a fraction of the pension fund’s more than $200 billion in assets, DiNapoli said he hopes to continue to grow the low-carbon portfolio.
The special climate fund is based on a traditional index fund made up of leading corporations, except that it weights its investments by considering whether the companies disclose their carbon footprints and act to reduce them.
Shareholders Push for Risk Disclosure
DiNapoli is one of several powerful officials from the city and state of New York who have sought to pressure fossil fuel companies and influence their investment and risk management practices. The city has launched litigation seeking to recover climate damages and pledged to divest its pensions funds from fossil fuel producers, and the state’s attorney general has been in a long fight with ExxonMobil on its climate record.
Corporations have come under increasing pressure in recent years to better disclose the risks they face in a future of rising temperatures and greater restrictions on greenhouse gas emissions. DiNapoli’s office helped lead a resolution approved last year by Exxon shareholders that requires the oil giant to report on those risks annually.
Disclosure was a common theme at the summit, which was hosted by the United Nations Foundation, the UN Office for Partnerships and Ceres, a nonprofit that promotes sustainable investment.
“If you are not a climate-aware investor, then you are fundamentally not doing your job,” said Brian Deese, global head of sustainable investing for BlackRock, a leading investment firm. As the world works toward achieving the Paris climate agreement goals, he said, companies that are already grappling with this challenge are better positioned for long-term growth. The only way for investors to assess this, he said, is with better disclosure.
In December, BlackRock called on about 120 corporations in energy, transportation and other industries to report on climate risk. Earlier this month, the investment firm’s chief executive, Larry Fink, reminded corporate leaders that social responsibility has become a critical element of any company’s financial success.
Enabling Clean Energy Growth
Much of the discussion on Wednesday focused on the key role that finance will play in enabling nations to slash greenhouse gas emissions in line with the Paris climate pact.
“Governments need to know that their financing element, if they really engage in the Paris Agreement, is going to be delivered,” said Patricia Espinosa, executive secretary of the UN Framework Convention on Climate Change.
Lisa Jackson, who led the EPA under President Obama and now heads environment, policy and social initiatives for Apple, spoke about the role of private money in expanding renewable energy. Apple, whose servers use lots of electricity, has committed to powering all of its operations from renewables.
Even as many leaders spoke optimistically about this clean energy transition and the financial sector’s growing role, Sharan Burrow, general secretary of the International Trade Union Confederation, called it “a disgrace” that few governments are helping to retrain workers in the fossil fuel industry who stand to lose their jobs.
“So your work is critical. If we don’t get that right in fossil fuels as the shift is now on,” she said, “then we’re going to leave a lot of stranded workers and communities.”
veryGood! (74946)
Related
- Bill Belichick's salary at North Carolina: School releases football coach's contract details
- Man gets 226-year prison sentences for killing 2 Alaska Native women. He filmed the torture of one
- ‘Hot girl summer,’ move aside. Women are going ‘boysober’ and have never felt better.
- Small Nashville museum wants you to know why it is returning artifacts to Mexico
- Sonya Massey's father decries possible release of former deputy charged with her death
- Police chief resigns after theft of his vehicle, shootout in Maine town
- Jurors in Sen. Bob Menendez's bribery trial begin deliberations
- Georgia state tax collections finish more than $2 billion ahead of projections, buoying surplus
- Trump suggestion that Egypt, Jordan absorb Palestinians from Gaza draws rejections, confusion
- Alix Earle's Sister Ashtin Earle Addresses PDA Photos With DJ John Summit
Ranking
- 'No Good Deed': Who's the killer in the Netflix comedy? And will there be a Season 2?
- Smoking laptop in passenger’s bag prompts evacuation on American Airlines flight in San Francisco
- Nordstrom Quietly Put Tons of SKIMS Styles on Sale Up to 61% Off— Here's What I’m Shopping
- DWTS' Peta Murgatroyd Gives Birth, Welcomes Baby No. 3 With Maks Chmerkovskiy
- A Mississippi company is sentenced for mislabeling cheap seafood as premium local fish
- Joey Chestnut's ban takes bite out of Nathan's Hot Dog Eating Contest TV ratings
- Young Voters Want To Make Themselves Heard In Hawaii — But They Don’t Always Know How
- This woman threw french fries on her husband's grave. Millions laughed – and grieved.
Recommendation
Which apps offer encrypted messaging? How to switch and what to know after feds’ warning
Vermont floods raise concerns about future of state’s hundreds of ageing dams
Police chief resigns after theft of his vehicle, shootout in Maine town
Prosecutors in Karen Read case argue against dismissing any charges
All That You Wanted to Know About She’s All That
Tour helicopter crash off Hawaiian island leaves 1 dead and 2 missing
RHOA Alum NeNe Leakes Addresses Kenya Moore's Controversial Exit
Conservative groups are pushing to clean voter rolls. Others see an effort to sow election distrust