AFT Resolution

CLIMATE AND GREEN INVESTMENTS

WHEREAS, according to a 2022 report by the Intergovernmental Panel on Climate Change (IPCC), a body of experts convened by the United Nations, governments are not doing nearly enough to protect cities, farms and coastal areas from the impacts of climate change they already are experiencing, and that immediate, transformational action is required to avert the most catastrophic impacts; and

WHEREAS, in February 2021, the United States officially rejoined the 2015 Paris Agreement, an international accord involving nearly every nation, that aims to significantly reduce global greenhouse gas emissions to limit global temperature increase during this century to 2 degrees Celsius above preindustrial levels; and

WHEREAS, a 2021 study found that none of the G20 nations—which together are responsible for 80 percent of greenhouse gas emissions—are on track to achieve the emissions reduction goals laid out in the 2015 Paris Agreement, and the IPCC warned in 2021 that countries must achieve zero emissions within 15 years to avert global warming of 1.5 degrees Celsius above preindustrial levels; and

WHEREAS, there is a consensus among the IPCC and other experts that limiting global warming to 2 degrees Celsius above preindustrial levels is necessary to avoid unmanageable and unpredictable economic and social consequences, including severe and unpredictable impacts on risk-adjusted returns to investors, including teachers’ pension funds, and

WHEREAS, there is a scientific consensus that the burning of fossil fuels (oil, coal and gas)—and the consequent increase in carbon dioxide and other greenhouse gases in the atmosphere– is the primary cause of climate change; and

WHEREAS, fossil fuel companies have spent millions on lobbying and denying the well-documented environmental consequences of burning fossil fuels at the current rate, with some fossil fuel corporations actively suppressing information from their own scientists on global warming since the 1980s; and

WHEREAS, fossil fuel companies have failed to produce robust climate change plans detailing how they will adapt to the low- or zero-carbon future required to avoid climate catastrophe; and

WHEREAS, Russia’s invasion of Ukraine has made it more apparent that fossil fuel dependence puts people at risk, makes energy systems insecure and enables authoritarian power grabs, destabilizing democracy and economies across the globe, and creating serious investment risks; and

WHEREAS, it is estimated that $250 billion in AFT members’ pension assets are invested in fossil fuel companies and related assets; and

WHEREAS, fossil fuel companies’ role as the primary driver of climate change and their refusal to modify their business models pose investment risks to institutional investors like public pension funds; and

WHEREAS, some AFT locals and members are already engaging with AFT members’  pension funds on climate issues, including working with student groups, community organizations and advocacy groups that urge pension funds to divest from fossil fuels; and

WHEREAS, some pension funds where AFT members serve as trustees have already taken significant actions to reduce fossil fuel exposure and address climate risk, including the Teachers’ Retirement System of the City of New York, which voted in 2021 to divest from fossil fuels; the New York State Teachers’ Retirement System, which voted in 2021 to divest from thermal coal and engage with fossil fuel companies on climate risk; and the California State Teachers’ Retirement System, which in 2021 successfully replaced two ExxonMobil board members over their failure to account for climate risk and create sustainable investment value:

RESOLVED, that the American Federation of Teachers will work with the AFT pension Trustee Council to identify and develop investment opportunities for members’ pension funds that simultaneously create and support good jobs and generate noncarbon-emitting energy, and provide a just transition for workers and communities that may be harmed due to changing energy sources; these investment opportunities may include but are not limited to low or zero carbon-emittingschools, affordable housing, and other renewable energy and infrastructure projects that benefit AFT members, students, and communities while also producing positive risk-adjusted financial returns for pension funds; and

RESOLVED, that the AFT will work with our trustees, locals, state federations and members’ retirement systems to assess the exposure of our members’ pension funds to fossil fuels, and evaluate risk of climate change to those funds’ overall investment portfolios, including evaluating the impact to the fund of divesting from thermal coal companies, other types of fossil fuel companies and other companies that contribute substantially to climate change, consistent with fiduciary duty to participants and beneficiaries; and

RESOLVED, that the AFT will work with our locals, state federations and members’ retirement systems to support shareholder initiatives that seek to address the investment risk posed by climate change, and require companies to clarify and demonstrate progress in achieving their climate risk policies, consistent with fiduciary duty; and

RESOLVED, that the AFT will work with pension trustees to engage with private equity and hedge fund managers on climate risk and adopt fund policies requiring that private equity firms and hedge funds disclose their fossil fuel-related holdings on an annual basis, and

RESOLVED, that the AFT will support efforts by the Biden administration and independent agencies such as the U.S. Securities and Exchange Commission and the Board of Governors of the Federal Reserve System to require comprehensive disclosure of climate-related data and risk factors by operating companies, asset managers and other financial institutions.

(July 17, 2022)

(2022)

Please note that a newer resolution, or portion of a resolution, may have superseded an earlier resolution on the same subject. As a result, with the exception of resolutions adopted at our most recent AFT convention, resolutions do not necessarily reflect current AFT policies.