A “Grade A” and Other Recognitions for CalPERS

Posted on June 25, 2013 by Hank Boerner – Chair & Chief Strategist

One of the state public employee systems that we track is CalPERS — long a leader in advancing effective corporate governance and now a leader in embracing and communicating about ESG performance as part of their investment strategy.

The California Public Employees Retirement System (CalPERS) is the largest state investment fund in the USA, with Assets Under Management of US$257 billion as of March 31, 2103. More than 1.5 million public employees are covered by the system (including 550,000 retirees).
Grade A: The Asset Owners Disclosure Project (AODP) gave CalPERS a “Grade A” and the ranking of #15 of the world’s 1,000 largest asset managers in the organization’s 2012 Global Climate Change Index Survey. The Project is an independent not-for-profit which evaluates the largest asset managers for disclosure level and industry best practices. The objective is to protect retirement funds from the risks posed by climate change. The annual survey yields insights for the asset owners association regarding large asset owners’ strategies to deal with climate change.
Reporting Progress
CalPERS released its first report on its ESG work – “Towards Sustainable Investment – Taking Responsibility” – detailing the “3 Ps” of its program: Priorities, Performance and Procurement. Explained in the report: How CalPERS integrates ESG into its own operations. The report was issued on CalPERS’ 80th birthday.
In the message from CalPERS leadership team – Rob Feckner, board president; Anne Stausboll, CEO; Henry Jones, chair of the investment committee; and Joseph Dear, chief investment officer — is the definition of sustainability: Sustainability in its simplest form is the ability to continue, and for a long-term investor like CalPERS, with long-term liabilities, it’s at the heart of what we do.
The “Towards Sustainable Investment” reporting effort received a commendation for the “Best Responsible Investment Report by a Large Pension Fund” from Responsible Investor. These awards are based on research on more than 1,000 pension funds around the world. (Responsible Investor is a UK-based sustainable finance and governance news organization.)
CalPERS was the only North American fund to be honored for an award in all pension categories at RI’s London Awards Summit.
CalPERS is a founding member of the Principles for Responsible Investment (PRI) and has long been a leader in advancing corporate governance best practices for the companies in portfolio. (The former CalPERS annual target list for governance engagements was popular with some investors who knew that the CalPERS focus usually brought  about increased enterprise value for the companies in the bulls-eye for engagement. The list has been discontinued.) The CalPERS report can be accessed online.

G&A’s Awards & Recognitions Program
Your corporate sustainability journey may have begun. Or, the journey may be far along, maturing – and the story being told through the GRI sustainability report. Who is taking notice? Who is recognizing the company’s reporting effort (the progress report for corporate achievements), and bestowing recognition? Which of the many “best of” lists, and ratings, rankings, scores ,and other third party judgments is your company being included in – where are you positioned in the race to the top? Learn more about G&A’s Awards & Recognitions Program