New York State Comptroller Thomas P. DiNapoli today announced a $3 billion increase to the New York State Common Retirement Fund’s (Fund) Sustainable Investment Program, raising its total commitment to $10 billion.
"Climate change poses a significant threat to our investments. Smart, sustainable investments protect the long-term value of the Fund and at the same time can be a powerful tool for helping to address the risk of climate change," DiNapoli said. "The current Administration in Washington may have withdrawn from the Paris Agreement, but in New York ‘We Are Still In’ and committed to making the Paris Agreement’s goals a reality. I’m determined to keep New York State’s pension plan well-funded and invested in the emerging low carbon global economy."
As a member of the We Are Still In Leaders’ Circle, DiNapoli serves as an ambassador for American climate action and the We Are Still In coalition. DiNapoli will be a panelist at the 24th Conference of the Parties to the United Nations Framework Convention on Climate Change (UNFCCC) — known as COP24 — in Katowice, Poland in December. He previously participated in COP21 in Paris and COP23 in Bonn.
"We Are Still In calls on the U.S. business and investor community to do more to tackle climate change, and NYS Comptroller Tom DiNapoli, as a leader of one of the largest pension funds, continues to heed that call and set the bar higher," said Mindy Lubber, President and CEO at Ceres. "These new, bold sustainable investments will go a long way in helping to make progress against the ambitious objectives of the Paris Agreement and accelerate the low-carbon economy."
The Fund’s Sustainable Investment Program includes more than $4 billion in its low emissions index, which launched in January 2016. The index eliminates or reduces the Fund’s public equity investments in companies with high emissions of greenhouse gases (GHG) and increases investments in lower-emitting corporations. The carbon footprint of the Fund’s low emissions index is more than 75 percent lower than its benchmark. The remaining $6 billion is dedicated for sustainable investments that address a variety of themes, including clean energy and green infrastructure.
DiNapoli’s Sustainable Investment Program
Since taking office in 2007, DiNapoli has been recognized as a global leader in the fight against climate change, addressing material risks and pursuing opportunities for the Fund’s investments. For two consecutive years, the Asset Owners Disclosure Project ranked the Fund as the top U.S. pension fund, and third globally, for its efforts to assess and combat climate-related investment risk. DiNapoli’s Sustainable Investment Program is key to the Fund’s efforts to address climate risk.
Sustainable Investing: DiNapoli’s commitment to sustainable investments, now totaling $10 billion, integrates key environmental, social and governance (ESG) principles into the Fund’s investments, which include:
- $4 billion for the low emissions index;
- $6 billion targeted to sustainable investments across asset classes. Investments have included Generation Asset Management, the Rockefeller Asset Management Global Sustainability and Impact Strategy and the Rise Impact Fund;
- LEED Gold real estate investments, green bonds and private equity investments;
- ESG risk assessments for all new investments; and annual reviews of ESG oversight of existing investments with an annual carbon footprint analysis of the Fund’s public equity portfolio (16 percent lower overall emissions profile relative to its benchmark in 2017).
The Fund actively continues to seek large-scale sustainable investment opportunities around the globe that meet its risk and return requirements.
Active Ownership: DiNapoli uses the Fund’s voice and shareholder voting power to protect investments by calling on companies to address climate change risks they face, to report on and reduce their GHG emissions and acknowledge their business opportunities and risks in the emerging low carbon economy. In recent years, the Fund has:
- Filed more than 125 climate-change-related shareholder resolutions and reached 55 agreements with portfolio companies for them to analyze climate risks, set GHG reduction targets and renewable energy and energy efficiency goals, prevent deforestation, publish sustainability reports and appoint directors with environmental expertise;
- Convened an Advisory Panel to identify potential avenues for further decarbonizing the Fund’s holdings;
- Supported the Climate Risk Disclosure Act sponsored by US Senator Elizabeth Warren that would direct the Securities and Exchange Commission to require public companies to disclose GHG emissions and plans for addressing risks associated with climate change;
- Recruited fellow state comptrollers and treasurers to oppose efforts to weaken federal emissions standards for cars and trucks;
- Opposed rolling back the federal Clean Power Plan;
- Won broad shareholder support for shareholder resolutions urging major fossil fuel companies, including ExxonMobil and Duke Energy, to examine how goals of the Paris Agreement will impact their business, and continue to press for increased transparency on their climate risk plans;
- Wrote to more than 300 companies in the low emissions index, calling on them to publicly disclose their emissions data. More than 100 companies agreed to disclose this information over the last three years; and
- Joined forces with investors representing trillions of dollars in engaging corporations to accelerate and expand emissions reductions, enhance risk disclosures and implement sustainable business practices, including PRI, CDP’s Carbon Action, the Climate Action 100+ and CERES, where DiNapoli has served on the Board of Directors since 2011.
About the NYS Common Retirement Fund
The New York State Common Retirement Fund is the third largest public pension fund in the United States with assets of $207.4 billion as of the March 31, 2018 end of its most recent fiscal year. The Fund holds and invests the assets of the New York State and Local Retirement System on behalf of more than one million state and local government employees and retirees and their beneficiaries. It has consistently been ranked as one of the best managed and best funded plans in the nation.