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House Judiciary Committee requests ESG documents from California pension system (2023)
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House Judiciary Committee Chairman Jim Jordan (R-Ohio) requested documents late last year from the California Public Employees’ Retirement System (CalPERS), the largest public pension system in the country, and Ceres, a nonprofit group that advises CalPERS on environmental matters. The committee is seeking information about CalPERS’ ESG efforts and the effect they have had on investments and returns. CalPERS has been complying with the request, turning over thousands of pages of documents over the last several months:
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The California Public Employees’ Retirement System has turned over thousands of pages of documents in recent months to Congress as the country’s largest pension fund faces Republican scrutiny for its investment practices intended to combat climate change. The $464 billion fund has been handing over the trove of information to the House Judiciary Committee led by Ohio Republican Jim Jordan since the committee sent letters in December to Calpers and Ceres, an environmental non-profit that Calpers works with on climate issues, seeking public and private documents dating back to 2016. The requests come as GOP officials nationwide step up attacks on ESG investing. Calpers is now reviewing additional documents to see if they are relevant to the committee’s request and in hopes of avoiding a subpoena, spokesperson John Myers said. In June, Jordan hit Ceres with a subpoena following voluntary disclosures that he deemed “inadequate.” The documents provided by Calpers include slide decks and reports detailing the fund’s sustainable investment strategies. The pension fund also handed over private email conversations between Anne Simpson, a former managing investment director at Calpers, and staff at Ceres, according to batch of documents reviewed by Bloomberg. The pension fund is part of a handful of companies, institutional investors and non-profits that are the subject of increasing attacks from Republicans in Congress over environmental, social, and governance investing. In July, Jordan’s committee demanded documents from BlackRock Inc., Vanguard Group Inc. and State Street Corp. alleging “potentially harmful effects on Americans’ freedom and economic well-being.” Boston-based Ceres is complying with the Judiciary Committee’s subpoena and has provided thousands of pages of documents, spokesperson Helen Booth-Tobin said. The organization has denied violating antitrust laws, saying companies are taking their shareholders’ financial interests into account by factoring in climate change risks. … Kristoffer Inton, an analyst at Morningstar, said despite Republican accusations of Calpers orchestrating an ESG cartel the pension fund continues to invest in major carbon emitters. Calpers held $9.4 billion in oil and gas assets as of December 2022. “If they think Exxon looks cheap they’re going to buy it,” Inton said. “It’s not changing their behavior.”[1] |
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Steve Soukup, an opponent of ESG and a senior fellow at Consumers Research—a nonprofit that also opposes ESG—said ESG protocols have hurt CalPERS returns and California pensioners. Soukup said the following about CalPERS and ESG in his 2021 book The Dictatorship of Woke Capital:
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According to a December 2017 report from the American Council for Capital Formation (ACCF), “One key factor behind this consistently poor performance, according to the ACCF report, is the tendency on the part of CalPERS management to make investment decisions based on political, social and environmental causes rather than factors that boost returns and maximize fund performance.” The report also noted “that four of the nine worst performing funds in the CalPERS portfolio as of March 31, 2017, focused on supporting Environment, Social and Governance (ESG) ventures. None of the system’s 25 top-performing funds was ESG-focused.”[1] |
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See also
- Environmental, social, and corporate governance (ESG)
- Economy and Society: Ballotpedia's ESG newsletter
External links
Footnotes
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