NY State Pension Fund Strikes Climate Deals with Five Companies

Comptroller DiNapoli drops shareholder resolutions in exchange for commitments to greenhouse gas reductions.

The $247.7 billion New York State Common Retirement Fund has reached agreements with five major US companies to reduce their greenhouse gas emissions (GHG), adopt new energy efficiency measures, and increase their use of renewable energy.   

The five companies are pizza chain Domino’s, steel maker Cleveland-Cliffs Inc., chemical company Albemarle Corp., water treatment company Pentair, and commercial property owner Realty Income Corp.

New York State Comptroller Thomas DiNapoli, who is the fund’s trustee, said Domino’s pledged to adopt GHG targets; Cleveland-Cliffs Inc. set GHG targets and committed to co-funding a green hydrogen project; Albemarle Corp. committed to adopting GHG targets; Pentair agreed to commit to setting GHG and clean energy targets; and Realty Income Corp. agreed to commit to adopting GHG targets by engaging with its clients.

The companies also agreed to regularly report on their progress toward meeting the targets. As a result of the agreements, the fund has decided to withdraw the shareholder resolutions it had filed with the companies.

“More and more companies understand that addressing climate change, by reducing their carbon emissions, helps their long-term success and benefits investors,” DiNapoli said in a statement. “The transition to a low carbon future and meeting our country’s renewed commitment to the Paris Agreement present enormous opportunities for smart, sustainable investments.”

The fund has been using its influence in recent years to push companies, particularly the ones it invests in, to adopt climate change policies that align with the Paris Agreement. In 2019, DiNapoli unveiled the fund’s Climate Action Plan, under which the fund may divest from companies that fail to meet minimum standards related to climate change, and it doubled its sustainable investments from $10 billion to $20 billion over the next decade.

The plan also calls for engaging with portfolio companies to encourage and support climate risk management, strategic planning and reporting; refine external manager evaluation to better assess climate-related strategies of the fund’s managers; and encourage index providers to integrate climate risks and opportunities into their index construction.

And in December, DiNapoli announced that the fund had pledged to transition its investment portfolio to reach net zero greenhouse gas emissions by 2040.

The fund said it has filed more than 150 climate change-related shareholder resolutions and reached 77 agreements with portfolio companies 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.

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