New York pension fund highlights climate risk as top voting engagement priority

The New York State Common Retirement Fund (Fund), which has $259.9bn in assets, has revealed that climate risks are one of its key stewardship priorities ahead of the 2024 Annual General Meeting (AGM) season.

In a statement, New York State Comptroller Thomas P. DiNapoli, trustee of the Fund, revealed that the US pension fund has filed 27 shareholder proposals at companies’ AGMs on issues associated with the fund’s four stewardship priorities: climate risks; diversity equity and inclusion; workforce management; and governance.

Among the proposals going to vote include greenhouse gas emission target reduction proposals at US bank Capital One Financial Corp and American steakhouse chain Texas Roadhouse.

DiNapoli stated that these stewardship priorities have been sent to its top 100 public equity holdings to “ensure their awareness”. “Companies that take steps to be responsible corporate citizens are more likely to be profitable, sustainable investments for New York’s pension fund,” he explained.

Alongside the stewardship priorities, the Fund has also updated its proxy voting guidelines in regard to climate risk.

The fund will now incorporate criteria used to evaluate companies’ climate performance including climate transition strategies and plans, greenhouse gas emissions reduction targets, capital expenditure alignment, and Task Force on Climate-Related Financial Disclosures disclosure.

Past AGM season

In the 2023 AGM season, the Fund cast more than 30,900 votes at 3,235 public company meetings.

According to the fund’s Stewardship Report it also voted against over 350 directors at companies including US oil and gas supermajor Exxon Mobil, energy company Chevron and energy infrastructure company Kinder Morgan for failing to address climate risk.

Through proxy voting, DiNapoli also urged shareholders of US banks Citi, Bank of America, Wells Fargo, JPMorgan Chase, Morgan Stanley and Goldman Sachs to support his call for greater disclosure on how they align their financing activities with the ongoing climate transition.

According to the report, it reached agreements with four US companies – Carrier Global, Papa John’s International, Central Aluminium and Spirit Reality – to evaluate and set targets to reduce their greenhouse gas emissions.