Three New York City pension funds have achieved better than expected greenhouse gas emissions reductions through their investments, illustrating that reducing climate risk can be achieved without harming investment returns, said Brad Lander, city comptroller, in a March 24 news release.
“We will not retreat one inch from our strong action on climate risk, which is entirely consistent with our fiduciary duty,” said Lander, the custodian for the five pension funds in the New York City Retirement Systems. “Others may walk back their climate commitments and cave to the current administration’s climate denialism, but we will not be cowed."
Three of the five pension funds in the city pension system are participating in the greenhouse gas emissions reduction program to achieve net-zero emissions by 2040. Aggregate emissions between 2019 and 2024 fell 37% for the $108.9 billion New York City Teachers’ Retirement System, $89.1 billion New York City Employees’ Retirement System and $9.8 billion New York City Board of Education Retirement System.
The reduction exceeded the 2025 interim targets set by each of the three pension funds, Lander said. The pension funds representing police and firefighters, with combined assets of $76.5 billion, aren’t participating. Each of the five pension funds has an independent governing board.
For specific reductions, the New York City Employees’ Retirement System cut emissions in its public equity and corporate bond portfolios by 34.6% between 2019 and 2024.
The interim goal had been a 32% reduction in 2025 for Scope I and Scope 2 emissions. The goal for 2030 is 59%.
According to the Environmental Protection Agency, Scope 1 emissions are direct greenhouse gas emissions that occur from sources that are controlled or owned by an organization, such as emissions associated with fuel combustion in boilers, furnaces, vehicles. Scope 2 emissions are indirect greenhouse gas emissions associated with the purchase of electricity, steam, heat or cooling.
New York City Teachers’ Retirement System achieved a 39.5% reduction in Scope I and Scope 2 emissions between 2019 and 2024, topping the 32% goal for 2025. The goal for 2030 is 59%.
The Board of Education Retirement System reported a 28.3% reduction in Scope I and Scope 2 emissions between 2019 and 2024, exceeding the 22% goal for 2025. The 2030 goal is 49%.
The news release also described “climate-change solutions” investments for three pension funds:
- The employees pension fund set a goal of $17 billion in investments by 2035, of which $4.5 billion is now in investments and unfunded commitments.
- The teachers pension fund has a goal of $19 billion by 2035, of which $5.9 is now in investments and unfunded commitments.
- The board of education pension fund set a goal of $1.8 billion by 2035, of which $608 million is now in investments and unfunded commitments.
