Calpers Will Plug Sustainability Into Investment Decisions

The $3 billion dollar California Public Employees’ Retirement System has revised its investment policies so that they will consider a company’s sustainability policies in addition to profitability and shareholder return. The revised language says companies will be expected to operate in “a risk-aware manner while conducting themselves with propriety and with a view toward responsible conduct.” Whether the two different sets of goals are in conflict depends on definitions and “investment horizon,” but as the New York Times article about the new policy points out, where they are deemed to conflict, Delaware courts could rule that the sustainability mandate is illegal.