Oklahoma Capitol in Oklahoma City
Oklahoma's largest pension fund, the $20.7 billion Oklahoma Teachers' Retirement System, will divest $184 million in the publicly-traded securities of Bank of America, BlackRock, J.P. Morgan Chase, State Street and Wells Fargo, five of the six firms that Oklahoma has identified as being hostile to the fossil-fuel industry.
The securities are held in index and bond funds that are part of Oklahoma Teachers' overall portfolio of investments.
The decision comes as Oklahoma Treasurer Todd Russ looks to enforce a controversial law requiring public pension funds to sever ties with firms said to discriminate against oil and gas companies.
The law was implemented in 2022 to punish firms for factoring environmental, social and governance issues into their investment decision making.
"Keeping ESG out of investing is necessary due to its broad goal complexity, unmanageable reporting framework and heavy-handed mandates," Russ wrote in a news release dated Dec. 8.
In the news release, Russ mentioned the decision of the Oklahoma teachers pension fund to divest $184 million from the blacklisted firms, explaining that the divestment was due to the firms "supporting ESG causes negative to Oklahoma industries."
Sarah Green, executive director of the Oklahoma Teachers' Retirement System, confirmed the decision, which was made at a board meeting on Nov. 15.
The board voted to divest $123 million in index funds that held the publicly-traded securities of Bank of America, BlackRock, J.P. Morgan Chase, State Street and Well Fargo. It also voted to divest $61 million in three bond funds that held the debt securities of Bank of America, J.P. Morgan Chase and Well Fargo.
"The TRS board and staff take our roles as fiduciaries to the members of our system very seriously," Green said in an email. "In arriving at this decision, we conducted a thorough analysis of the law and our particular plan and are confident in the decision and our continued ability to provide a secure retirement to our members."
Russ said the $123 million divestment in index funds would cost the system approximately $32,700 and that the $61 million divestment in the bond portfolio had "no estimated cost as selling this security traditionally has no commissions."
Green confirmed Russ' divestment cost estimates.
In the news announcement, Russ also mentioned that Oklahoma's Tobacco Settlement Endowment Trust, a state grantmaking trust whose board of investors Russ leads as chairman, voted in November to select a new firm to manage the trust's passive large-capital growth portfolio. The divestment and management switch would cost nothing, he said.
The Tobacco Settlement Endowment Trust did not respond to an email asking for details about the switch or how much it holds in assets.
