New York State’s US$247.7-billion pension fund is dropping the more than $7 million it’s invested in seven Canadian tar sands/oil sands producers, citing the “significant environmental, legal, and economic risks” the companies face.
The New York State Common Retirement Fund, the pension manager for more than a million state and municipal employees, said it would sell off its holdings and make no future investments in Imperial Oil, Canadian Natural Resources Ltd. (CNRL), Cenovus, Husky Energy (recently bought out by Cenovus), MEG Energy, Athabasca Oil, and Japan Petroleum Exploration, CBC reports. Suncor Energy was not among the companies identified in the release.
“As nations around the world become increasingly serious about addressing the threat of climate change and as market forces drive a low-carbon economic transition, we need to make sure our investments line up with this reality,” New York State Comptroller Thomas P. DiNapoli said in a release. “We have carefully reviewed companies in the oil sands industry and are restricting investments in those that do not have viable plans to adapt to the low-carbon future. Companies responsible for large greenhouse gas emissions, like those in this industry, pose significant risks for investors.”
The Common Retirement Fund, the United States’ third-largest pension plan, announced plans late last year to bring its entire investment portfolio to net-zero emissions by 2040. At the time, it said it would get rid of its “riskiest” oil and gas stocks by 2025.
Climate campaigners greeted the fund’s latest announcement as part of an “oil sands investor exodus,” in a release coordinated by Stand.earth.
“The first state pension fund in North America to divest from tar sands is no small matter,” said Stand Climate Finance Director Richard Brooks. “This is only the beginning, as other North American pension funds are increasingly recognizing that the tar sands is a risky investment both for pensioners and our planet.”
“Alberta’s oilpatch is the dirtiest of the dirtiest—there’s no need for this crude, and no place for it on a planet serious about the climate crisis,” said 350.org co-founder Bill McKibben. “Kudos to New York’s Comptroller Tom DiNapoli for making it clear that you can’t build your retirement on tarsands.”
But “as a growing number of influential institutional investors around the world pull the plug on the tar sands, Canadian pension funds are becoming climate laggards,” with the country’s top 10 public funds holding nearly C$1.7 billion in CNRL alone, said Adam Scott, director of Shift Action for Pension Wealth and Planet Health. “It’s abundantly clear that ‘engaging’ companies whose core business is extracting the most carbon-intensive oil in the world is not going to cut it—either for a climate-safe future, or growing Canadian pension savings.”
Natural Resources Minister Seamus O’Regan insisted Canada’s fossil sector will lead the transition to clean energy, CBC writes. “The Canadian energy workers who figured out how to pull oil out of sand in the Prairies and out of the treacherous North Atlantic off of Newfoundland are the same people who will build our low-emissions energy future,” he said in a statement.