CalPERS won’t back down on climate, CEO warns ahead of Trump’s return
The CEO of the largest public pension fund in the US is taking a defiant stance on climate, despite the threat of political pushback from the incoming Trump administration
In the wake of the US elections and weeks before Donald Trump is due to take office for the second time, CalPERS CEO Marcie Frost addressed the challenges a new administration in Washington could bring. She emphasised that CalPERS would remain steadfast in its climate ambitions.
Speaking to the CalPERS Board of Administration, Frost, the CEO of the $502.9bn public retirement fund, acknowledged that change was “top of mind” for many stakeholders.
“I’ve had a number of conversations, both internally and externally, with stakeholders—particularly about the uncertainty some might feel regarding what lies ahead in the wake of various elections around the nation. These results make it clear that change is coming, and we are ready to engage with incoming leaders and their representatives on the issues that are crucial to the benefits earned by our members,” she said.
Frost hinted at the discord between CalPERS’ stance on climate investing and the expected priorities of the incoming US administration. During his previous term, Donald Trump announced the US withdrawal from the Paris Agreement, and as president-elect, he has already vowed to repeal large parts of Biden’s Inflation Reduction Act.
“Sometimes we find our priorities are closely aligned with the people voters have chosen to lead our state and federal governments. Other times, those chosen leaders see the path forward a bit differently. Either way, we keep moving,” Frost stated.
At the end of 2023, CalPERS announced plans to allocate nearly a fifth of its total assets—$100bn—to tackling climate change through a dedicated Climate Action Plan. Some of these commitments pertain to existing holdings. Earlier this month, the fund disclosed that it had invested $53bn in what it described as “climate solutions,” spanning climate-tilted equity indices to private market allocations in energy transition technology and infrastructure.
Looking ahead to the new year, Frost suggested there would be new voices and opinions on issues like climate change. However, she reaffirmed CalPERS’ commitment to its strategy, saying: “On climate change, we will continue to advocate for companies we invest in to provide clear, consistent data on their climate impacts. And we will continue to support international efforts to do the same. Data is key to fulfilling our fiduciary duty.”
Her comments alluded to CalPERS’ membership in climate networks like Climate Action 100+ (CA100+). The fund is among several US financial institutions targeted by Republican Congressman Jim Jordan, chair of the US House Judiciary Committee, who has accused them of being part of a “woke ESG cartel.”
Despite political changes in Washington, California remains at the forefront of US climate legislation. The state has introduced sweeping disclosure rules on climate risk and greenhouse gas emissions for businesses operating in California. These laws, SB-253 (GHG emissions) and SB-261 (climate risks), are widely expected to come into force in 2026, regardless of the change in federal leadership.
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