Seventh annual sustainability report highlights enterprise risk management in first half of 2020
News release | Vanessa Garcia
WEST SACRAMENTO, Calif. (March 3, 2021) – The California State Teachers’ Retirement System today released its 2019–20 Sustainability Report. The report follows the Global Reporting Initiative (GRI) Standards, which are recognized as the global best practices for corporate sustainability reporting.
In prior sustainability reports, CalSTRS reported on the path to full funding, member retirement preparedness and corporate sustainability. Given the events of 2020, CalSTRS updated our key topics to reflect the importance of managing enterprise risks, the transition to a low-carbon economy, and diversity and inclusion.
“In our more than 100 years as a system, CalSTRS has never experienced a year like 2020,” said CEO Jack Ehnes. “The COVID-19 pandemic created a global paradigm shift, rapidly changing the lives of our members and employees. This past year emphasized the importance of anticipating and adapting to unexpected events while continuing our business and serving our members.”
Managing enterprise risk
- Before California’s stay-at-home directive was issued in March 2020, CalSTRS executed emergency business continuity plans to ensure our core business functions were maintained while shifting most staff to telework.
- In a newly remote environment, CalSTRS paid benefits, collected contributions, provided customer service to members, managed investments and conducted board meetings without interruption.
Path to full funding
- Despite market volatility in spring 2020, CalSTRS is still on track to reach near full funding by 2046.
- The Teachers’ Retirement Board approved new long-term asset allocation targets, a key component to reaching full funding.
Member retirement preparedness
- CalSTRS paid $15.9 billion in benefit payments over the fiscal year, not including member refunds.
- Because our members do not pay into Social Security for CalSTRS-covered employment, CalSTRS continued to educate members on potential impacts for non-CalSTRS covered Social Security member and spousal benefits.
Transition to a low-carbon economy
- CalSTRS established a new investment belief affirming that public policies, technologies and physical impacts associated with climate change are driving the transition to a low-carbon economy.
- CalSTRS expanded our low-carbon investments across asset classes, engaged carbon-intensive companies and cast more than 8,000 proxy votes.
Diversity and inclusion
- To promote greater diversity on corporate boards, we continued to engage portfolio companies on this topic.
- CalSTRS began hosting internal dialogues and educational speakers on race, equity and allyship.
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CalSTRS provides a secure retirement to more than 975,000 members whose CalSTRS-covered service is not eligible for Social Security participation. In 2019–20, members retired on average after more than 24 years in the classroom with a monthly benefit of approximately $4,614. Established in 1913, CalSTRS is the largest educator-only pension fund in the world with approximately $282.5 billion in assets under management as of January 31, 2021. CalSTRS demonstrates its strong commitment to long-term corporate sustainability principles in its annual Global Reporting Initiative Sustainability Report. For more information, visit CalSTRS.com.