Baltimore's three pension funds will soon have to divest from fossil fuels.
Baltimore Mayor Brandon M. Scott, a Democrat, signed a bill Monday that requires the $3.5 billion Baltimore City Fire & Police Employees' Retirement System, the $2.2 billion Baltimore City Employees' Retirement System and the $31 million Baltimore Elected Officials' Retirement System to divest from fossil fuels over a five-year period beginning Jan. 1, 2022.
The bill, originally introduced in April by Councilman Mark Conway, a Democrat, reserves flexibility for the pension fund boards and staff to carry out, or, in emergency circumstances, suspend implementation of the ordinance.
"The results of runaway greenhouse gas emissions — more severe storms, flooding that threatens neighborhoods, heat island effects which contribute to health issues and burden the city's infrastructure — are here in Baltimore," Mr. Conway said in a statement.
He added, "Our city divested from apartheid South Africa in the 1980s, and from Sudan during the genocide in Darfur. Now, as cities, states, and countries grapple with the existential threat of climate change, Baltimore is once again putting our money where our mouth is. And in doing so, we join the growing divestment movement away from the outdated pollution strategies of the past and toward the sustainable energy revolution of the future."
The pension funds will have to divest from companies listed on The Carbon Underground 200, a list compiled by FFI Solutions — formerly Fossil Free Indexes — that identifies the top 100 coal and the top 100 oil and gas publicly traded reserve holders globally, ranked by the potential carbon emissions content of their reported reserves, according to information on its website.
N. Anthony Calhoun, executive director of the fire and police fund, welcomed the new law in a statement. "Climate change is real, so I am proud to work for a government that wants to contribute to the solution," he said. "ESG is going to redefine investing over the next few years and pension funds and companies are going to have to adjust."
A representative for the employees' and elected officials' retirement systems as well as the mayor's office could not immediately be reached for comment.