Dear New Yorkers, 

The financial industry has a major role to play in mitigating the worst effects of climate change and financing a just transition to clean energy. But they currently aren’t moving fast enough to prevent the costly and catastrophic impacts of rising seas and temperatures. 

Major banks Bank of America, Goldman Sachs, JPMorgan Chase, and Royal Bank of Canada say they have net zero commitments to reduce their greenhouse gas emissions. But right now, they only have targets for reducing emissions intensity, a relative and variable measurement that doesn’t necessarily result in real-world emissions reductions. 

If the banks don't have near-term absolute reduction targets, they don't really have a net zero plan.  

That’s why last week, three of the New York City Retirement Systems (the New York City Employees' Retirement System, Teachers' Retirement System, and Board of Education Retirement System) announced shareholder proposals at Bank of America, Goldman Sachs, JPMorgan Chase, and Royal Bank of Canada calling for the banks to set absolute greenhouse gas (GHG) emissions targets for 2030.
Reuters article on banking shareholder proposals about climate emissions rules
As institutional investors with holdings across the entire global economy, the New York City pension funds have a fiduciary obligation to mitigate risks to our investments caused by climate change.  

The New York City pension funds have long been leaders in this work. Three of the five funds have completed divestment from fossil fuel reserve owners, determining that their fiduciary duty demanded halting investments in companies whose assets will and should be stranded in the energy transition. In 2021 the three funds voted to target Net Zero emissions across their portfolios by 2040, an ambitious goal that cannot be met without the active participation of all our asset managers. A just transition to a clean energy economy requires action from across the financial industry and the global economy – and the costs of not doing so are too high to contemplate.  

Last week, my team and I also met with Secretary John Kerry, President Biden’s Special Envoy for Climate, to talk about the role the financial industry must play towards reducing absolute greenhouse gas emissions.
New York City Comptroller Brad Lander with Secretary John Kerry and leadership from the Sierra Club.
New York City Comptroller Brad Lander with Secretary John Kerry and leadership from the Sierra Club. [Photo by Jose Suarez]
It’s going to take leadership from the top of our government and the titans of Wall Street to make the progress we need towards confronting climate risk. That’s why in September I wrote to BlackRock CEO Larry Fink, the head of the largest asset management firm in the world, urging him to align the firm’s actions with its climate commitments by phasing out financing of new fossil fuel infrastructure and joining us in voting for climate shareholder resolutions at companies where they hold significant stake.  

This spring in addition to our own shareholder proposals at the four banks that are behind on setting real emissions reduction targets, we’ll be supporting a set of resolutions urging a set of banks to stop financing new fossil fuel infrastructure.  

As the right-wing ramps up its war on responsible investing, not only the retirement security of public sector workers, but also the finances of local governments and all of our futures are at risk. A recent report found that Texas stands to lose hundreds of millions from higher fees on municipal bonds after they blacklisted companies that acknowledge climate risk. 

Financial institutions like BlackRock have rightly said that climate risk is financial risk. We’ve all seen that only too clearly in the billions in damages from record flooding, fires, and storms of the last year. Now, we need BlackRock, the big banks and other financial institutions to act like they mean it.  

Onwards,  

Brad
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