New York City pension funds divesting $4B from fossil fuels

Two pension funds for New York City workers are pulling an estimated US$4 billion in investments from fossil-fuel companies in order to promote clean-energy use.

Mayor Bill De Blasio and Scott Stringer, the city’s comptroller, announced Monday that the boards of the $91.4-billion New York City Employees’ Retirement System and the $77.4-billion New York City Teachers’ Retirement System had voted to approve fossil-fuel divestment. A third pension fund, the New York City Board of Education Retirement System, is expected to vote for divestment soon. Several dozen universities have already stopped investing, at least partially, in fossil fuels, often under pressure from students.

Read: University of California pension fund to dump fossil fuel investments      

“The divestment from fossil fuels is possible and necessary,” said Stringer, in a video briefing with de Blasio on Tuesday. “Smart investment policy and smart climate solutions go hand in hand. And we’re putting our money where our mouth is.”

In 2018, De Blasio and Stringer set a goal to divest city pension funds from the fossil-fuel industry, which includes oil, gas and coal companies. Environmentalist and author Bill McKibben said he knew then that the city’s push to divest would have an impact. “What I said at the time was, I thought this was particularly significant because of the signal it sent if the financial centre of the world had gotten this message,” he said. “And I said New York’s actions would be heard loud and clear.”

New York state comptroller Thomas DiNapoli announced last month that the state’s $226-billion pension fund would drop many of its fossil-fuel stocks in the next five years and sell its shares in other companies that contribute to global warming by 2040.

The New York pension plans are the latest to announce a divestment strategy. Last week, the Ontario Teachers’ Pension Plan committed to achieving net-zero greenhouse gas emissions by 2050, following calls for divestment by several environmental groups. And last March, the University of British Columbia’s faculty pension plan launched a fossil fuel-free investment option for members.

Read: Ontario Teachers’ committing to net-zero emissions by 2050