New York may decarbonize its portfolios as part of its Green New Deal

Per New York Governor Andrew Cuomo’s State of the State:

In 2018, Governor Cuomo called on the New York Common Fund, which manages over $200 billion in retirement assets for more than one million New Yorkers, to adopt a serious and responsible plan for decarbonizing its portfolio. Over the past year, the Governor has worked with the Office of the Comptroller to establish an advisory panel of experts to develop a decarbonization roadmap and guide the Common Fund toward investment opportunities that combat climate change.

As part of the Green New Deal, Governor Cuomo is taking the next step, by directing State authorities, public benefit corporations, and the State Insurance Fund, which collectively hold approximately $40 billion in investments, to commence a process to review and evaluate the feasibility and appropriateness of divesting from fossil fuels. To scale up investment in renewable energy, green infrastructure, and climate solutions, agencies and authorities will also work to educate plan administrators and investment consultants regarding investment opportunities in the clean energy sector.

Media coverage of our 2019 fiduciary predictions

New CalPERS board member questions engagement as an ESG strategy

Chief Investment Officer is reporting that Jason Perez, the newly-elected board member of the California Public Employees’ Retirement System, is skeptical of CalPERS’ ESG strategies, including engagement. He reportedly said, “We should not be extorting companies.” Shareholder engagement has become a preferred method of addressing ESG risks, though it has garnered the interest (and concern) of both the SEC and DOL, as well.

Institutional investors to gain greater access to China A-shares

The South China Morning Post is reporting that the combined quota under the qualified foreign institutional investors (QFII) scheme, through which overseas funds can buy China’s A-shares, will be doubled to US$300 billion effective immediately. The quota scheme is an alternative to the Stock Connect, which we have previously discussed.

Chamber of Commerce announces plan to help boards guard against shareholder activism

Bloomberg Law is reporting that the U.S. Chamber of Commerce recently announced a plan to educate board members on public policy issues, such as climate change, as a way to help “better arm” the boards for increasing shareholder engagement on these issues. Proxy voting and shareholder engagement, including the use of, and reliance on, proxy advisory firms, has come under greater scrutiny from the SEC and DOL recently.