Ada Recinos, Deputy Press Secretary at ada.recinos@sierraclub.org (Pacific Time)
Sacramento, CA – CalPERS beneficiaries testified this week, calling on the CalPERS Board of Directors to commit to no new Exxon bond purchases to protect against financial risk due to climate change.
“ExxonMobil poses some of the most powerful opposition to climate action at every level of government. But perhaps more indicative of ExxonMobil’s commitment to business-as-usual pollution is the bonds they’ve issued this fall, with a maturity date of 2074,” shared Allie Lindstrom, Senior Campaign Strategist for the Fossil-Free Finance Campaign at the Sierra Club. “These Exxon bonds are an especially risky gamble for investors with long-term obligations – such as public pensions. Beneficiaries are calling on CalPERS to protect our futures: Their retirement and our climate.”
These long-dated bonds represent unrestricted funds for ExxonMobil to continue to pursue fossil fuel expansion and plastic pollution well past most of the world’s Net Zero by 2050 goals. The long-term fate of oil and gas companies is precarious in a transforming economy, but near-term pollution has clear consequences: increases in warming and economy-wide systemic risks. Exxon’s 2074 bonds bet against the clean energy future and ask investors – and the everyday people who rely on institutions to manage their savings – to take on all the risk as climate change wreaks havoc.
In addition to public testimony, members of California Common Good, the Sierra Club, and others delivered a letter signed by about 2,000 beneficiaries and supporters. Current and future pension holders wrote:
”Purchasing bonds from Exxon is risky. Whether ExxonMobil fails to repay the bonds or its polluting activities contribute to diminishing returns across the economy, CalPERS beneficiaries will be left holding the pursestrings…The money saved for worker retirement, the raw material with which many private equity and hedge funds do their often-destructive work, could instead be harnessed to provide adequate, affordable housing for working families and buttress support for essential taxpayer contributions to public-sector pension funds.”
Climate is a growing concern for most Americans, not a fringe worry for “extreme” investors. Investors must continue to escalate and take note of CalPERS beneficiaries' courageous and effective call to action for an end to Exxon bonds.
Background
Timeline of escalation to protect public pensions against risky Exxon investments:
- Spring 2024:
- California community members and pension beneficiaries demanded that CalPERS divest from fossil fuels mobilized since 2015.
- Exxon filed suit against shareholders over a climate-related resolution fails; CEO Darren Woods vows to retaliate against climate-focused investors.
- California Common Good delivers a petition to CalPERS and CalSTRS, asking the pensions to hold Exxon accountable.
- Thirteen trustees, including NYC Comptroller Brad Lander and CA Treasurer Fiona Ma, urge major asset managers to oppose Exxon leaders at the May 29 annual general meeting.
- CalPERS filed an exempt solicitation encouraging investors to vote against Exxon’s Board of Directors.
- Fall 2024:
- CalPERS beneficiaries and supporters call on the fund to divest from Exxon, citing risks to retirement security and lack of effective shareholder engagement opportunities
- Darren Woods threatens to continue filing shareholder lawsuits against “activist investors”
- Exxon issues a bond that matures in 2074
- Over 2,000 CalPERS beneficiaries and supporters ask CalPERS to issue a moratorium on purchasing Exxon bonds
About the Sierra Club
The Sierra Club is America’s largest and most influential grassroots environmental organization, with millions of members and supporters. In addition to protecting every person's right to get outdoors and access the healing power of nature, the Sierra Club works to promote clean energy, safeguard the health of our communities, protect wildlife, and preserve our remaining wild places through grassroots activism, public education, lobbying, and legal action. For more information, visit www.sierraclub.org.