Oregon pension fund to review fossil fuel investments
The Oregon state pension fund has launched its net zero strategy and committed to reaching net zero by 2050
The $93.8bn Oregon Public Employees Retirement Fund (OPERF) has announced that it will be reviewing its fossil fuel investments within public markets on the launch of its net zero strategy.
In the 97-page Net Zero Plan, the US pension fund committed to achieve net zero emissions by no later than 2050 and reduce its portfolio carbon emissions intensity by 60% by 2035.
To achieve these goals, the plan outlined several measures including conducting a review of its carbon-intensive fossil fuel investments in public markets by February 2025.
Alongside this, OPERF will also exclude new investments in private market funds that have stated intention to invest primarily in fossil fuels.
For its existing unlisted investments, the pension fund will push for “credible” transition plans from those that derive greater than 20% of revenue from carbon intensive fossil fuel activities.
The Net Zero Plan comes as the Oregon state treasurer Tobias Read has been pushing for the pension fund to drop its fossil fuel investments to curb climate change over the last two years.
Commenting on the plan, Read said: “The impacts of climate change are being felt across the globe, including in Oregon. Planning and acting now to address the investment risks – and opportunities – of the climate crisis is a critical next step in making sure the pension fund will produce strong returns far into the future.”
Financing climate solutions and increasing our corporate engagement will generate more emissions reductions while also producing stronger, sustainable long-term returns.
Tripling climate investments
Other measures announced tripling the fund's climate positive investments in private equity and real assets from the current £2bn to £6bn by 2035.
OPERF also highlighted that it will increase the percentage of its public equity holdings that are climate or transition aligned.
The Net Zero Plan also included stewardship objectives, with OPERF committing to increasing shareholder engagement and investor partnerships, including 90% of real estate emissions and 65% of emissions across both real assets and private equity.
It added that OPERF will monitor manager selection to ensure there is alignment of its investment strategy with broader net zero progress.
“By prioritizing strategies that support transition and decarbonization, we avoid simply shifting the emissions burden to other investors while not doing anything to mitigate climate change in a meaningful way.
“Financing climate solutions and increasing our corporate engagement will generate more emissions reductions while also producing stronger, sustainable long-term returns,” said Read said.
