The city of Seattle will not invest its cash balances in fossil fuel companies and is taking additional steps to divest employee-deferred compensation funds and pressure its pension fund system to pull money from Chevron and ExxonMobil, two of the system’s top 10 investments.
The pension system currently has $17.6 million invested in ExxonMobil and Chevron, which represent just under 1 percent of its $1.9 billion in assets. The city’s deferred compensation plan controls another $700 million in employee investments.
The moves follow Mayor Mike McGinn’s pledge last year during 350.org’s 21-city campaign to encourage colleges, churches and governments to pull their endowment funds out of the fossil fuel industry.
McGinn’s power to control investment is limited to the city’s $1.4 billion in cash balances for daily operations. City money is not currently invested in fossil fuel companies and finance director Glen Lee has been directed to not invest those cash balances into the industry in the future, McGinn said in an update on his pledge.
McGinn has also written to the Deferred Compensation Plan Committee and the city’s pension system governing board to request that they refrain from investing in fossil fuel companies in the future and begin exploring options for moving existing investments.
McGinn made the pledge last year as the non-profit organization 350.org kicked off its Do the Math tour, an effort to draw a link between extreme weather, climate change and the fossil fuel industry. The tour, which is now complete, kicked off in November in Seattle.
But 350.org’s divestment campaign continues. It is asking schools, churches and governments to immediately freeze new investment in fossil fuel companies and divest from direct ownership and any co-mingled funds that include fossil fuel public equities and corporate bonds within five years.
Last month, the Asset Owners Disclosure Project (AODP) published what it called the first-ever global climate investment index showing how the world’s biggest investors, including pension funds, are managing climate risk. No US firms rank in the top 10 of the index.