Next up was Lorraine Kelly, ISS' global head of investment stewardship, who said, "Neither one (of Texas' pension funds) is using our benchmark policy. They just wanted another view. And we're actively engaged with TRS (Texas Teacher Retirement System) in discussion about policy which focuses on the G — and not the E and S — as a standard offering within ISS."
Lori Heinel, global chief investment officer for State Street Global Advisors, testified next, and said the firm "only serves client demands, they do not pick and choose. Investors can invest in fossil fuels if they want to or not, and we also have a ETF that is exclusively oil and gas centered."
State Street scores companies based on understanding of risks, and "We are not telling companies what to do, just informing them of potential climate related risks," she said.
ISS maintained there is neither bias nor an agenda in regards to fossil fuel companies, although one senator, Paul Bettencourt, said he is "firing ISS immediately based on a lack of recognition of the obvious".
"ISS recommendations to divest from fossil fuels is a prima facie evidence of having an agenda," Mr. Bettencourt said.
Mr. Bettencourt asked whether ISS "will generally vote against directors if the company doesn't implement greenhouse emission targets. How is this agnostic policy? Ladies, I encourage you to reconsider your position," said Mr. Bettencourt to the firm representatives in the room.