CalSTRS, the US$200 billion Californian State Teachers’ Retirement System, has announced it will divest all non-US thermal coal holdings from July 1. The commitment follows the fund’s decision to dump all US thermal coal holdings in December 2015.
Here in Australia, the CalSTRS decision will see them sell off their holdings in Whitehaven Coal, which owns and operates the dirty Maules Creek coal mine in New South Wales. The other coal companies set to be sold off are Indonesia’s PT Adaro Energy and Exxaro Resources from South Africa.
Coming less than two weeks after Donald Trump pulled the US out of the Paris climate accord, CalSTRS now complete thermal coal divestment announcement was backed up with particularly strong language against the future of the dirty coal industry.
“The regulatory risk and environment impacts climate change places on the fund far outweighs the ability of thermal coal companies to continue to create long-term value” said California State Controller Betty T. Yee, a Teachers’ Retirement Board member.
Fellow board member and California State Treasurer John Chiang added “At a time when clean-energy jobs far outpace those of the dying coal industry, why should we continue to invest in a product that pollutes the air, sickens our children and contributes to global warming.”
It is heartening to hear such clear condemnation of the thermal coal industry, which must be phased out as a matter of utmost urgency if we are to have any chance of restricting runaway climate change.
Sadly, comments and action like CalSTRS’ is glaringly absent amongst Australia’s investment community.
The Californian fund’s recognition of their fiduciary duties as requiring a decisive reduction of the risks posed by coal holdings is also a far cry from Australian funds’ understanding of climate risk.