NYS PENSION FUND LAUNCHES REVIEW OF INTEGRATED OIL & GAS COMPANIES

 

Latest Step in Comptroller's Review of Fossil Fuel Holdings to Determine Which Companies Are Ready for Transition to Low-Carbon Future

 The New York State Common Retirement Fund (Fund) is evaluating 28 publicly traded integrated oil and gas companies to determine if they are prepared for the transition to a low-carbon economy, New York State Comptroller Thomas P. DiNapoli, the Fund’s trustee, announced today. Each company is being asked to provide information on its readiness to transition to the emerging net zero economy.

“Oil and gas companies face significant and complex economic, environmental and regulatory challenges in the years to come,” DiNapoli said. “These companies need to be ready for the transition to the low-carbon economy of the future. While energy companies are currently making record profits driven by high prices, their long-term prospects are far less certain. As investors, we will carefully review these companies and may restrict investments in those that do not have viable plans to adapt.”

Integrated oil and gas companies – including ExxonMobil, Chevron, Shell, BP and others – engage in all facets of the oil and gas business, from exploration and production to transportation, refinement and retail sales.

Today’s actions come as part of DiNapoli’s comprehensive Climate Action Plan to mitigate investment risks posed by climate change and ultimately transition the Fund’s investment portfolio to net zero greenhouse gas emissions by 2040. DiNapoli also released the Fund’s second progress report regarding the implementation of the Climate Action Plan.

The evaluation of the Fund’s integrated oil and gas holdings is part of DiNapoli’s broader review of the transition readiness of energy sector investments that face significant climate risk. The Fund’s prior reviews of shale oil and gas, oil sands and coal companies led to the Fund’s divestment from 55 firms that the Fund determined failed to demonstrate transition readiness.

Background on DiNapoli’s Climate Investment Actions

Since taking office in 2007, DiNapoli has been recognized as a global leader for his efforts to protect the Fund’s investments, address material risks from climate change and pursue sustainable investment opportunities for the Fund. In 2019, DiNapoli released a Climate Action Plan, a multi-faceted strategy that includes a goal of committing $20 billion to sustainable investments, dedicated staff to pursue climate solution investments, and minimum standards for portfolio companies that will inform engagements, investments and potential divestment decisions. Building on the Climate Action Plan’s solid foundation, in December 2020, DiNapoli announced the Fund has adopted a goal to transition its portfolio to net zero greenhouse gas emissions by 2040.

Background on New York State Common Retirement Fund

The New York State Common Retirement Fund is one of the largest public pension funds in the United States, with assets of $272.1 billion as of March 31, 2022. The Fund holds and invests the assets of the New York State and Local Retirement System on behalf of more than 1 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.