SF 2085

as introduced - 90th Legislature (2017 - 2018) Posted on 03/14/2017 10:05am

A bill for an act
relating to State Board of Investment; mandating a report on the impact of climate
change on the fossil fuel investments currently held by the State Board of
Investment.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1. new text begin STATE BOARD OF INVESTMENT; REPORT ON THE RISKS OF
INVESTMENTS IN FOSSIL FUEL COMPANIES CURRENTLY IN THE
PORTFOLIO.
new text end

new text begin (a) The State Board of Investment shall prepare a report on the stability and security of
investments in companies that are involved in the exploration, production, development,
transportation, or sale of fossil fuels. The report must be limited to assets of the public
pension and retirement funds managed by the State Board of Investment. The ultimate goal
of the report is to assess the risks to the assets of the public pension and retirement funds
due to climate change and its adverse consequences.
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new text begin (b) The report shall include the following:
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new text begin (1) a description of the fiduciary duties, prudent person standard, and other requirements
that govern the State Board of Investment's management of the retirement funds;
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new text begin (2) definitions of fossil fuel investments and renewable energy investments;
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new text begin (3) an assessment of the impact of carbon exposure on fossil fuel investments in the
retirement funds and its asset class target;
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new text begin (4) an assessment of the concerns and potential costs of continuing to stay invested in
fossil fuel companies, generally, and specifically, continued investment in coal mining and
producing companies;
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new text begin (5) identification of the approaches available to public institutional investors that address
climate change initiatives;
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new text begin (6) identification and assessment of alternatives to fossil fuel investments, including
investment in renewable energy companies and engagement in the governance of fossil fuel
companies;
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new text begin (7) a summary of research on the processes, procedures, and policies utilized by other
public pension plans to address climate change issues;
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new text begin (8) a description of how climate change is currently addressed in the investments of the
retirement funds;
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new text begin (9) development of metrics that could be implemented to assess the impact of the carbon
exposure of individual companies and describe measures that would address potential
adverse consequences to the retirement funds of continued investment in companies holding
a large carbon footprint;
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new text begin (10) identification of improvements that could be incorporated into the State Board of
Investment's proxy guidelines to address environmental policy that encourage further
engagement in climate change initiatives; and
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new text begin (11) identification of resources available to the State Board of Investment to continue
acquiring knowledge on climate change risk and related investment alternatives.
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new text begin (c) The State Board of Investment shall deliver its report on or before February 1, 2018,
to the chair, the vice-chair, and the executive director of the Legislative Commission on
Pensions and Retirement.
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new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
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