We know that mutual funds could cause political spending proposals to pass. But what about large public pension funds?
Pensions and Investments 1 highlighted the number of large pension funds which are voting in favor of a climate change risk disclosure proposal at ExxonMobil’s annual meeting tomorrow. The proposal, filed by the New York State Common Retirement Fund, calls for the oil and gas company to evaluate and disclose the viability of its portfolio under the 2-degrees scenario, the concept of limiting the average global temperature increase to 2 degrees Celsius.
The California State Teachers’ Retirement System (CalSTRS), the Canada Pension Plan Investment Board, the Florida State Board of Administration, the Texas Teacher Retirement System and the Ontario Teachers’ Pension Plan are all voting in favor of the climate proposal, according to their proxy-voting disclosures.
So we checked to see whether these funds are also supporting the lobbying disclosure shareholder proposal, which is seeking information about how ExxonMobil influences public policy, including its payments to trade associations that are used to lobby, often on climate issues. The two (climate change and lobbying) would seem interrelated, and one would think all the funds would also support lobbying disclosure. All of these major public pension funds are also supporting the lobbying disclosure proposal at Exxon, with the exception of the California State Teachers’ Retirement System. CalSTRS has announced it will be voting against the proposal.
CalSTRS corporate governance principles state that “disclosure should include the annual contributions, both monetary and non-monetary, made to trade associations and/or other tax-exempt organizations involved in political activities.” Yet Exxon does not publicly disclose its trade association memberships, payments or the amounts of it trade association payments used for lobbying. So why doesn’t CalSTRS support lobbying disclosure transparency at Exxon?
1. Meaghan Kilroy, “Pension funds line up in favor of climate change disclosure proposal at Exxon Mobil,” Pensions & Investments, May 26, 2017.