The board of Calpers, the biggest US pension fund, has voted to intensify its efforts to prod car makers to adopt California’s strict tailpipe emission standards and vowed to make environmentalism a top investment priority, Reuters reported.
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The news agency noted that the board’s move came only two days before the Kyoto international climate change treaty goes into effect – it requires developed nations to cut greenhouse gas emissions.
According to Reuters, the board of the $US182 billion California Public Employees’ Retirement System, known as Calpers, said its investment staff could evaluate the fund’s portfolio companies in terms of any environmental liabilities they might pose – under the plan, utility companies, along with car makers, would come under scrutiny because of greenhouse gas emissions.
The plan calls this year for Calpers to join the Carbon Disclosure Project, a European effort by shareholders concerned about the effect of carbon emission on company value, the report added.
“We expect environmental corporate stewardship to play a greater role in corporate governance over the next 10 years,” Calpers board member Priya Mathur reportedly said.
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By GlobalDataPhil Angelides, California’s treasurer and Calpers board member, told the news agency that the plan also serves as a challenge to the Bush administration.
Angelides, as well as former vice president Al Gore and acting Calpers board President Rob Feckner, hosted a conference call with reporters on Monday afternoon, Reuters said.
The United States, which accounts for about a quarter of greenhouse gas emissions, has not signed the Kyoto treaty, the news agency noted.
Gore reportedly said the White House has its “head in the sand” on the issue of greenhouse gas, which contributes to global warming.
Reuters said Calpers’ move marks an escalation in its battle [pressuring] car makers to adopt California’s emissions standards – car companies could be placed on the pension fund’s so-called “focus list,” a step it takes to discipline companies.
Reuters said the Alliance of Automobile Manufacturers, an industry group, is suing to stop the state standards from taking effect and turned down a Calpers invitation to meet to discuss its demands.
Steve Westly, California’s controller and a Calpers board member, told the news agency the fund’s aggressive posture is necessary with the Kyoto protocol set to go into effect.
“What’s clear is that we’re giving the staff teeth,” Westly told Reuters in an interview.
The car makers’ alliance in a January 27 letter informed Calpers that only the federal government may set fuel-economy standards but California may set air-emissions rules, which state officials say gives it authority over this matter, Reuters added.
