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New York sues five biggest oil majors for climate change damages, city’s $189bn pension funds divest fossil fuels

Around $5bn in pension assets to be pulled from fossil fuel companies within five years in huge divestment shift.

New York’s five public pension funds, running assets of $189bn, are withdrawing the entire $5bn of their investment holdings in 190 fossil fuel companies within five years and the city of New York is suing the world’s biggest oil majors, BP, Chevron, ConocoPhillips, Exxon Mobil, and Royal Dutch Shell, for the billions of dollars they say it will have to spend to protect itself from the effects of climate change. The huge divestment move by the New York funds is amongst the most dramatic by any financial organisation in the world in the fight against global warming and its effects.
New York Mayor, Bill de Blasio, said the New York city lawsuit against the five largest investor-owned fossil fuel companies would seek damages to pay for what he called “harm that we’ve already seen and damages that are necessary to address harm we expect to happen over the course of this century.”
A statement by the city said the current and future financial impact of climate change for New York included the cost of building coastal protections, upgrading water and sewer infrastructure and dealing with heat mitigation, as well financing public health campaigns to help protect residents from the effects of extreme heat. It said the city was already funding a $20bn+ building resiliency program against rising seas, more powerful storms and hotter temperatures.
The city is basing its legal case on recently uncovered documents, which they say show that the fossil fuel industry was aware of the effects that burning fossil fuels would have on the planet’s atmosphere and the expected impacts of climate change as far back as the 1980s. They say the oil companies deliberately engaged in a campaign of deception and denial about global warming and its impacts. De Blasio said “We’re bringing the fight against climate change straight to the fossil fuel companies that knew about its effects and intentionally misled the public to protect their profits. As climate change continues to worsen, it’s up to the fossil fuel companies whose greed put us in this position to shoulder the cost of making New York safer and more resilient.”On the $5bn pull-back of investment from fossil fuel companies, New York Comptroller Scott M. Stringer, who has overall responsibility for the city’s pension funds, said he and other trustees would be submitting a joint resolution to the funds to begin analysing ways to divest by the end of 2023 “in a responsible way that is fully consistent with fiduciary obligations.” Stringer added: “It’s complex, it will take time, and there are going to be many steps. But we’re breaking new ground, and we are committed to forging a path forward while remaining laser-focused on our role as fiduciaries to the Systems and beneficiaries we serve.”

“It’s up to the fossil fuel companies whose greed put us in this position to shoulder the cost of making New York safer and more resilient.” Bill de Blasio

Each of the five New York pension funds – Teachers, NYCERS, BERS and the Police and Fire schemes – has a separate Board of Trustees that work with the City’s Bureau of Asset Management and the Board’s consultants to decide on investment strategy.
Separately, it is also expected that the $20bn San Francisco Employees’ Retirement System (SFERS) will hold a vote on whether it divests from its fossil fuel investments on January 24.
As reported by RI, the Board of Supervisors, the legislative body of the City and County of San Francisco, has since 2013 been urging SFERS’ staff to divest from its current 86 fossil fuel holdings.
A pioneering divestment move, although from a smaller fund, came in June 2016 when the District of Columbia Retirement Board informed that its direct holdings in the top 200 corporations with the majority of the world’s fossil fuel reserves “were reduced from approximately $20 million (0.33% of Trust Fund assets) to 0% over the last past couple of years”.