The California Public Employees’ Retirement System has provided an update on the progress towards its $100 billion climate deployment target. Public equity investments comprise the majority of CalPERS’ commitments so far: the system has allocated $5 billion to a “customised climate transition index”, according to the announcement. This index “will evaluate both the risks and opportunities of the global energy transition”.
The pension added that $1.1 billion has been committed to nine private market investments “in sectors supporting energy production and distribution as well as freight and supply chain optimization”. Private markets investments totalling a further $3.6 billion are currently under review. CalPERS has not disclosed any of the partners for these commitments or potential commitments.
CalPERS, whose assets are valued at $503.59 billion, unveiled its Climate Action Plan last year. It includes a target to invest $100 billion in climate solutions by 2030 – the biggest climate allocation ever created by an institutional investor – and plans to conduct climate risk assessments for due diligence and ongoing monitoring of new investments.
“The CalPERS Climate Action Plan is designed to make our pension fund the global partner of choice in climate investing,” Peter Cashion, managing investment director for sustainable investments, said in CalPERS’ announcement this week. “To do that, we need a diverse set of investments and tools to generate the excess returns that are achievable during this historic transition to a low-carbon future.”
