Tuesday, June 23, 2015

Tom Steyer to California Teachers: Divestment Makes Sense

Earlier this month I watched Tom Steyer make a clear case
for divestment from fossil fuels before the California State Teachers
Retirement System Board in Sacramento. The video of the presentation is
now available and linked below.

Steyer laid out five criteria for evaluating divestment:

1. Does the group of companies cause harm to society?

2. Is there a realistic replacement for the product or service they
provide?

3. Is it a long-term asset appropriate for large long-term pension funds?

4. Does engagement with management offer any prospect of improving the
investment?

5. What is is the financial impact to the retirement portfolio?

Steyer showed that fossil fuel investments fail in all five areas.

He provided data indicating that fossil fuel investments have actually
performed worse than other investments. He also questioned the value of
existing fossil fuel companies, arguing that their reserves will become
stranded assets as the world addresses climate change by reducing fossil fuel
use.

On the issue of whether the fossil fuel companies can reform themselves, he
said that if you look at the annual reports of the petroleum companies, it is
clear they are very reluctant to change their strategic thinking about their
long term role.

Steyer said that alternative energy is growing rapidly in California and he
expect there to be over 500,000 clean energy jobs in the state by the end of
the year: "We are seeing something very good happening here in terms
of the state push for clean energy."

Steyer's initial comments to CalSTRS are in the first 15 minutes or so of the
video, followed by Q&A with CalSTRS board members.

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About Me

Michael Paparian has over 35 years experience working on environmental finance and environmental policy issues. He has held a variety of positions inside and outside state government, including Deputy State Treasurer, Executive Director of the California Pollution Control Financing Authority, Special Consultant to the California Environmental Protection Agency, Board Member of the Integrated Waste Management Board and Sierra Club California State Director.