Calpers Ups Ante in Emissions Fight with US Car Makers
Date: 16-Feb-05
Country: USA
Author: Jim Christie
The board's move came two days before the Kyoto international climate change treaty goes into effect. It requires developed nations to cut greenhouse gas emissions, but the United States has not signed it.
The board of the $182 billion California Public Employees' Retirement System, known as Calpers, said its investment staff could evaluate the fund's portfolio companies in terms of any environmental liabilities they might pose.
Under the plan, utility companies, along with car makers, would come under scrutiny because of greenhouse gas emissions.
The plan calls this year for Calpers to join the Carbon Disclosure Project, a European effort by shareholders concerned about the effect of carbon emission on company value.
"We expect environmental corporate stewardship to play a greater role in corporate governance over the next 10 years," Calpers board member Priya Mathur said.
The plan also serves as a challenge to the Bush administration, said Phil Angelides, California's treasurer and Calpers board member.
Angelides, as well as former Vice President Al Gore and acting Calpers board President Rob Feckner, hosted a conference call with reporters on Monday afternoon.
The United States, which accounts for about a quarter of greenhouse gas emissions, has not signed the Kyoto treaty.
Gore said the White House has its "head in the sand" on the issue of greenhouse gas, which contributes to global warming.
FUND MAY 'FOCUS' ON GM AND FORD
Calpers' move marks an escalation in its battle with car makers to adopt California's emissions standards. Its board put Detroit on notice by approving its investment staff to vote for shareholder proposals requesting that General Motors Corp, the world's largest car maker, and Ford Motor, the second-largest US car maker.
Car companies could be placed by Calpers on its so-called "focus list," a step the fund takes to discipline companies.
The Alliance of Automobile Manufacturers, an industry group, is suing to stop the state standards from taking effect and turned down a Calpers invitation to meet to discuss its demands.
Steve Westly, California's controller and a Calpers board member, said the fund's aggressive posture is necessary with the Kyoto protocol set to go into effect.
"What's clear is that we're giving the staff teeth," Westly told Reuters in an interview.
The car makers' alliance in a January 27 letter informed Calpers that only the federal government may set fuel-economy standards.
However, California may set air-emissions rules, which state officials say gives it authority over this matter.
