Watch Sue’s Explanation:
Read the Bills:
H.2640 – “An act authorizing independent retirement systems to divest from fossil fuel companies”
By Messrs. Fernandes of Falmouth and Livingstone of Boston, a petition (accompanied by bill, House, No. 2640) of Dylan A. Fernandes, Jay D. Livingstone and others relative to authorizing independent retirement systems to divest from fossil fuel companies. Public Service.
S.722 – “An Act authorizing independent retirement boards to divest from fossil fuel companies”
By Mr. Pacheco, a petition (accompanied by bill, Senate, No. 722) of Marc R. Pacheco for legislation to authorize independent retirement boards to divest from fossil fuel companies. Financial Services.
Why divest from fossil fuels?
The fossil fuel era is ending and is being replaced by a low-carbon economy, a critical transition to mitigate climate change. Prudent investors must recognize climate-related financial risks and manage their portfolios accordingly to fulfill their fiduciary duty. By divesting, retirement systems eliminate exposure to substantial losses from the high-risk fossil fuel industry.
Purpose of Bill:
To allow independent public retirement systems, subject to oversight by the Public Employee Retirement Administration Commission (PERAC), to divest their holdings in full or in part from the fossil fuel industry. Under current regulatory decisions, retirement systems can’t divest without legislative approval. There are 104 independent public retirement systems in Massachusetts with nearly $86 billion in combined assets. These funds are separate from the MA Pension Reserves Investment Trust, which has nearly $71 billion in assets. A review of the holdings for Somerville and Cambridge shows that less than 4% of their total assets under management were in fossil fuels.
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