CalSTRS ‘Green Team’ Releases 2013 Annual Report
Fixed Income Green Program 900 basis points higher than reported in 2012
WEST SACRAMENTO, CA – California State Teachers’ Retirement System (CalSTRS) today announced the release of the Green Initiative Task Force’s seventh annual report detailing investment activities in environmental risk management and seized opportunities.
The Green Initiative Task Force, known as the “Green Team,” was established in 2007 to identify, analyze and propose investment opportunities and risk-control strategies associated with climate change. Since then the focus has pushed beyond carbon emissions to consider risks and opportunities related to issues such as land use, water sourcing, mineral extraction and waste disposal.
“This report reflects CalSTRS’ recognition that environmental issues affect the performance of the investment portfolio across companies, sectors, regions and asset classes. Since our last Green Team report, we have taken advantage of opportunities in clean energy production and transmission investments,” said CalSTRS Chief Investment Officer Christopher Ailman. “The integration of environment-focused investments is part of our fiduciary responsibility to secure the long-term financial future for generations of California’s educators.”
The Green Initiative Task Force 2013 Annual Report highlights CalSTRS asset classes’ efforts in integrating environmental considerations for fiscal year 2012-2013. Some recent efforts include:
- Fixed Income Green Program
- 34.7 percent of the portfolio is in debt securities that are included in the Barclays MSCI U.S. Credit Sustainability Index. The percent figure is 900 basis points higher than reported in the 2012 annual report.
- Fixed Income holds $25 million in green bonds.
- Global Equity Sustainable Investment Program
- Assets under management have grown to $780 million as of June 30, 2013 from $645.9 million the year before.
- Outperformed the benchmark in the non-U.S. portfolio by 3.10 percent.
- Private Equity Clean Technology and Energy Program
- Committed $696.4 million in the clean technology and clean energy sector as of June 30, 2013.
- 80.2 percent of total commitments have been invested to date.
- Real Estate Sustainable Returns Program: Separate Account Office Buildings
- 82 percent of separate account portfolio are Energy Star® certified and rank in the top quartile of energy efficient buildings.
- 24 buildings in the separate account portfolio are LEED certified.
- Corporate Governance: Corporate Engagement
- Engaged over two hundred portfolio companies on environmental issues such as energy efficiency, hydraulic fracturing, carbon emissions reporting, and fossil fuel reserve valuation.
- Inflation Sensitive: Green Infrastructure Investment Examples
- First Reserve Energy Infrastructure Fund – Investment: SunEdison Reserve a portfolio of contracted solar photovoltaic power generation facilities in Europe and North America.
- Balfour Beatty Infrastructure Partners – Investment: McEwan Power a portfolio of U.K.-based ground-mounted solar parks designed to generate just over 20 megawatts of energy.
The California State Teachers’ Retirement System, with a portfolio valued at $176 billion as of October 31, 2013, is the largest educator-only pension fund in the world. CalSTRS administers a hybrid retirement system, consisting of traditional defined benefit, cash balance and voluntary defined contribution plans. CalSTRS also provides disability and survivor benefits. For 100 years, CalSTRS has served California’s public school educators and their families, who today number 862,000 from the state’s 1,600 school districts, county offices of education and community college districts.