Trump administration's claim that responsible investing is detrimental to business has been countered by NYC Comptroller Lander, asserting that the city's investment professionals have demonstrated the opposite.
New York City's public pension funds are leading the way in responsible investing, with a strong focus on climate solutions and diversified asset allocation. This strategic approach integrates environmental, social, and governance (ESG) factors to mitigate systemic risks like climate change and inequality while aiming to maximize long-term returns.
The funds have set ambitious Net Zero Implementation Plans, targeting a net-zero greenhouse gas emissions portfolio by 2040. This commitment has already resulted in a 37% emissions reduction between 2019 and 2024, surpassing interim goals.
The funds' diversified investment portfolio includes a significant exposure to public equities (43.4%), public fixed income (31.5%), and private market alternatives (25.2%). This balanced approach aims to minimize risk while fostering portfolio resilience.
In addition to traditional investments, the pension funds engage in economically targeted investments aimed at community and long-term sustainability. Examples include preserving rent-stabilized housing and supporting climate-friendly infrastructure projects in New York. Responsible Property Management Standards have been adopted to improve property values and resident stability for long-term risk mitigation.
Investments with minority- and women-owned asset managers have increased substantially under current leadership, reaching $23.1 billion in FY 2024. This commitment to inclusivity reflects the funds' steadfast belief in the importance of a steady and long-term investment approach rooted in thoughtful diversification.
The NYC Comptroller, Brad Lander, and the trustees of the five retirement systems announced an aggregate investment return of 10.3%, net of fees, for the fiscal year ending 30 June 2025. This strong performance, despite significant market headwinds, demonstrates the success of this responsible investing strategy.
The NYC Comptroller's office emphasizes the strong case for fiduciary duty and responsible investment based on returns. Despite meritless attacks on responsible investing, they will continue to move strongly forward with their responsible investing approach.
This strategy aims to generate robust financial returns, with the pension funds achieving over 10% in recent fiscal years, while ensuring pension fund resilience and positive social impact. The NYC Comptroller claims that the strong investment returns offer timely evidence in favor of responsible investment.
In conclusion, New York City's public pension funds are pursuing a responsible investing strategy that prioritizes long-term returns, delivers wins for retirees and New York City, and demonstrates a commitment to climate solutions, diversified asset allocation, and economically targeted investments. This approach has already proven successful, with the funds' portfolio returns exceeding targets and offering a strong case for responsible investment.
[1] NYC Comptroller's Office. (2022). Net Zero Implementation Plans. [online] Available at: https://www.nyc.gov/assets/comptroller/downloads/pdf/reports/2022/net-zero-implementation-plans.pdf [2] NYC Comptroller's Office. (2021). Annual Report 2021. [online] Available at: https://www.nyc.gov/assets/comptroller/downloads/pdf/reports/2021/annual-report-2021.pdf [3] NYC Comptroller's Office. (2020). Annual Report 2020. [online] Available at: https://www.nyc.gov/assets/comptroller/downloads/pdf/reports/2020/annual-report-2020.pdf [4] NYC Comptroller's Office. (2024). Annual Report 2024. [online] Available at: https://www.nyc.gov/assets/comptroller/downloads/pdf/reports/2024/annual-report-2024.pdf [5] NYC Comptroller's Office. (2023). Annual Report 2023. [online] Available at: https://www.nyc.gov/assets/comptroller/downloads/pdf/reports/2023/annual-report-2023.pdf
- The NYC Comptroller's office, with a focus on climate solutions and diversified asset allocation, has integrated environmental, social, and governance (ESG) factors into their investment strategy to mitigate risks like climate change and inequality, as well as to generate robust financial returns by investing in science and environmental-science focused businesses, thereby targeting climate change.
- To further their commitment to climate solutions, the funds have directed their investing efforts towards climate-friendly infrastructure projects, which not only supports the environment but also provides financial returns through business ventures that contribute to reducing greenhouse gas emissions.
- The funds' inclusive approach to responsible investing extends beyond traditional finance by engaging in economically targeted investments that encompass finance and business deals that support environmental goals, such as preserving rent-stabilized housing or investing in minority- and women-owned asset managers, with the aim of maximizing returns while enhancing long-term sustainability.
