CALIFORNIA, USA – Climate change activists and some lawmakers seek two of California’s pension funds to divest fossil fuel holdings worth $15 billion.
The California State Assembly has suspended legislation that would have forced California’s pension funds, California Public Employees’ Retirement System (CalPERS), and the California State Teachers’ Retirement System (CalSTRS), to divest approximately $15 billion from oil and gas companies.
California’s pension funds, CalPERS and CalSTRS, are renowned and big-time institutional investors. The CalPERS is the largest California’s pension fund and one of the largest private equity investors in the world with $459 billion in assets.
On the other hand, California’s pension fund CalSTRS is currently the second-largest public pension fund in the US. California’s pension funds aid more than 3 million Californians and their families.
According to Marcie Frost, CEO of CalPERS, the bill would do nothing to combat the dangers of climate change. Furthermore, California’s pension funds like CalPERS are not closing the discussion and making sure to view and consider the different angles before taking a leap.
Frost said that she is not saying the intentions of divestment are not good. “They’re not coming through an investor lens. It feels like they’re coming through a morality lens,” she added. Discarding personal values, or personal morals, in investing the assets of the portfolio is vital.
Now, why climate activists are pushing for divestment?
A retired faculty member of San Francisco State University, Carlos Davidson, is entirely concerned with the immoral activities done by several different fossil fuel companies as this can tremendously affect them politically. “They should stop taking their money and politicians will stop their bidding,” said Davidson.
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