CalSTRS evaluating portfolio for climate change risks
September 30, 2019
In the wake of extreme weather events, rising sea levels, drought and wildfires that are being experienced in California and worldwide, CalSTRS is considering climate change risks and opportunities in its investment portfolio. There is no question that climate change poses material risks to humanity, the world economy and investment portfolios. Scientists agree that limiting the increase in global temperatures to 1.5°C above pre-industrial levels will prevent the worst impacts of climate change. To do its part to achieve this goal — and to fulfill its fiduciary duty to monitor and mitigate material risks to the pension fund — CalSTRS said it is committed to influencing public policies, engaging with companies and investing to promote an orderly transition to a low-carbon economy.  “CalSTRS believes that as a long-term investor committed to protecting the retirement security of California’s educators, it is prudent and necessary for us to be good stewards of the earth and its resources,” said Kirsty Jenkinson, director of Sustainable Investment and Steward Strategies at CalSTRS. CalSTRS, the largest educator-only pension fund in the world, is part of a group of more than 360 global investors with more than $34 trillion in assets who are fully supportive of the goals of the 2016 Paris Climate Agreement and policies that will help the world meet the agreement’s carbon emission reductions targets. In May, the pension fund’s Teachers’ Retirement Board prioritized analyzing the impacts of a low-carbon economy on CalSTRS’ investment portfolio. This work plan will inform the board on the best ways to capture low-carbon economic growth opportunities while also mitigating long-term risks.  CalSTRS serves California’s more than 949,000 public school educators and their families from the state’s 1,700 school districts.
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