Ceres Applauds CalPERS Bold $100 Billion Investment in Climate Solutions

November 15, 2023 /3BL/ - The California Public Employees' Retirement System (CalPERS), the largest public pension fund in the U.S. and longtime Ceres Investor Network member, announced a bold investment of $100 billion in climate solutions by 2030 to support its overall goal of achieving a net zero emissions portfolio by 2050.

CalPERS set out this investment goal in the context of its comprehensive Sustainable Investments 2030 Strategy. The overall strategy aligns well with the global expectations of comprehensive Investor Climate Action Plans or ICAPs.   

In addition to the investment target, the CalPERS plan includes an enhanced engagement strategy coupled with deep climate risk assessment. It also includes diversity and equity considerations for portfolio construction and manager selection.

“CalPERS took a monumental step towards addressing the climate crisis with a comprehensive strategy that aims to position the fund as a leader in achieving a net zero portfolio by 2050,” said Rev. Kirsten Snow Spalding, Vice President of the Ceres Investor Network at Ceres. “With this announcement, CalPERS has more than doubled their initial commitment to investing in climate solutions. And, they have done this in the context of a comprehensive investor climate action plan to address climate risks and seize climate solutions opportunities consistent with their fiduciary duty. This will enable them to effectively manage climate-related financial risk and ensure long-term shareholder value and returns across their entire portfolio.”

CalPERS’ strategy includes specific actions to reduce its portfolio emissions intensity by 2030 and make investments aligned with the global capital expenditures needed for net zero goals. It involves a process that assesses companies' net-zero plans, conducts financial risk analysis, and identifies opportunities in companies rapidly transitioning to the clean energy economy.

“This significant investment marks a pivotal shift, demonstrating the crucial role pension funds’ play in the just transition to net zero. Notable aspects of the plan include: its deep engagement strategy to actively support portfolio companies in rapid decarbonization; its alignment with the changing regulatory environment, following historic corporate climate risk disclosure laws in California and the upcoming federal Securities and Exchange Commission rule; and its proactive approach to capitalizing on new U.S. industrial policy in the inflation Reduction Act and Infrastructure Investment and Jobs Act. Few investor climate action plans consolidate all these elements as comprehensively as this plan does.”

Earlier this year, Ceres, and the founding partners of the Investor Agenda, released an updated Expectations Ladder for developing and publishing investor climate action plans. The expectations focus on climate action across four key areas including investment, corporate engagement, investor disclosure, and policy advocacy. 

About Ceres

Ceres is a nonprofit organization working with the most influential capital market leaders to solve the world’s greatest sustainability challenges. Through our powerful networks and global collaborations of investors, companies and nonprofits, we drive action and inspire equitable market-based and policy solutions throughout the economy to build a just and sustainable future. For more information, visit ceres.org and follow @CeresNews.

Media Contact: Vivian Melody, vmelody@ceres.org, 617-247-0700 ext. 353