Don’t Use My Pension to Support Big Oil and Big Plastic

“By 2050, plastic production is predicted to account for 50% of oil and fracked gas demand growth,” stated the California Assembly Natural Resources Committee in its bill analysis of the now-dead AB 2648 procurement reduction of single-use plastic beverage bottles.  

 

Think 2050 is too far off? Well, Big Oil and Big Plastic are busy working towards that outcome. Just look at some recent actions by Exxon, the fossil fuel giant with the world’s largest plastic waste footprint.

 

Since 2023, Exxon has spent over $562,000 on state-level lobbying and $9,140,000 on national-level lobbying on a variety of legislative and regulatory issues. They’re busy in court too. 

 

In January, Exxon sued its shareowners Arjuna Capital and Follow This, over a proposal to accelerate greenhouse gas emission reductions. The proposal was withdrawn. But Exxon continues the lawsuit. California State Treasurer Fiona Ma and several state’s fiscal officers urged major asset managers to hold Exxon accountable by voting against the Executive Chair and CEO Darren Woods, as well as the Lead Independent Director and Nominating and Governance Committee Chair Joseph Hooley. The California Public Employees' Retirement System (CalPERS) voted against them, but both were re-elected. Additionally, a proposal for a report on plastic production was not approved.  

 

On the day of Exxon’s meeting, the California Senate and Assembly held a joint hearing on public pension funds’ emerging climate investment initiatives. Senate Majority Leader Lena Gonzalez (D-Long Beach) stated, “Many of the high-emitters that climate engagement plans seek to work with have already begun to actually reserve their climate pledges. Exxon, a company whose ‘net-zero by 2050’ commitment was often lauded by the pension funds as an engagement victory only includes its strategy Scope 1 and 2 emissions in its pledge, when an estimated 90% of their carbon emissions of course come from Scope 3. . . Any real climate initiative that protects worker pensions must also contain an aggressive strategy to exit these companies now, not later.” 

 

 

According to the Institute for Energy Economics and Financial Analysis, “Divestment from fossil fuels is a defensive move to protect the long-term value of an investment portfolio while continuing to meet investment return targets.” Orange County Register did the analysis: “After more than a decade of skyrocketing contributions to CalPERS from state, city, school and special district governments — and from public workers themselves! — the system still only has 72% of the money it owes to public workers.” The University of Waterloo reported if CalPERS had divested from the energy sector in 2013, they would have added $4.7 billion to the portfolio. 

 

Gonzalez's SB 252 would require CalPERS and CalSTRS (the California State Teachers’ Retirement System) to divest from the 200 largest fossil fuel companies by 2031---over $14 billion, including  $6 billion invested in Exxon, Shell, Chevron, ConocoPhillips, and BP— five companies being sued by Governor Gavin Newsom and Attorney General Rob Bonta. Notably, CalPERS has $1 billion invested in Exxon.  

 

As a CalPERS member, I echo Gonzalez: divestment is a necessary climate action with good economic sense. A significant portion of my pay went into the pension each month, automatically not voluntarily. It bothers me that my money is used to support environmental injustice.

 

Exxon’s expansive polypropylene production in Louisiana and chemical production in Texas have severe health impacts on local communities. Sharon Lavigne in Louisiana testified before the U.S. Senate, highlighting the devastating effects of petrochemical plants and refineries: “We cannot drink the water, plant a garden, or breathe clean air. The place I remember being so beautiful and full of life is now called Cancer Alley.”

 

New York and Maine, as well as over 20 public agencies in California, including the University of California and the California State University, have committed to fossil fuel divestment. 

The Assembly Public Employment and Retirement Committee, chaired by Tina McKinnor (D-Hawthorne), will vote on SB 252 on June 19. Here’s my public comment: CalPERS, don’t use my pension to support Big Oil and Big Plastic.

 

John Armstorng is a member of Sierra Club San Gorgonio Chapter, and a CalPERS member who retired from the California Department of Transportation.