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Pension Funds Call For Climate Change Study
By Michael Schweibinz

The campaign for fossil fuel divestment is escalating and beginning to pose a meaningful threat to fossil fuel extraction companies. At campuses across the country, activists are campaigning against administrations that have refused to sell their fossil fuel stocks. Professors from the University of California and Cornell University have called on academic institutions to listen to students who are voicing the urgency for divesting of fossil fuel holdings, for the sake of the planet and for the financial health of the institution’s endowment.

In late October, 2013, pension fund leaders voiced their concern that fossil fuels will not be as profitable in the future. Seventy of the largest pension funds in the United States are asking 45 of the world’s largest coal, oil, gas, and electric companies to provide them with the results of detailed studies about how policies to control climate change might impact their business. They requested that the studies be completed by spring 2014.

Jack Ehnes of the California State Teachers’ Retirement System (CalSTRS) made it clear that his fund intends to work with fossil fuel companies to help them recognize the long-term options that will benefit investors, firms, and the environment. CalSTRS has $5.4 billion invested in major fossil fuel companies and notes the cognitive dissonance between the business strategies of the companies and the scientific trajectory.

The push is being lead by Ceres, an outspoken network of investors and companies advocating for sustainability leadership, and the Carbon Tracker Initiative.

So far, 30 companies have sent responses, but it is still unclear how many will agree to conduct the requested studies. Admittedly, it is difficult for companies to estimate the long-term risks because the timing and intensity of future regulations to are impossible to predict. However, it is undeniably in the companies’ best interest to build consideration of the impacts of climate change, increasing regulatory scrutiny, pricing carbon, and investor boycotts into strategic planing going forward.

 

First Affirmative understands that the ways we save, spend, and invest can dramatically influence both the fabric and consciousness of society. We believe that in addition to the benefits of ownership, investors bear responsibility for the impact our money has in the world. Are you making conscious decisions about the impact of your consumer purchase and investment decisions?

Posted: December 22, 2013