New York City Mayor Bill de Blasio, has announced that the city has filed a lawsuit against the five largest investor-owned fossil fuel companies as measured by their contributions to global warming.
New York will be seeking damages from BP, Chevron, ConocoPhillips, Exxon Mobil, and Royal Dutch Shell for the billions of dollars de Blasio said the city will spend to protect New Yorkers from the effects of climate change. This includes damages to pay for harm that had already happened and damages that are necessary to address harm the administration expected to happen over the course of this century.
The lawsuit seeks to recover the billions needed to fund climate change resiliency measures that the city needs to implement to protect the city, its property, and its residents from the ongoing and increasingly severe impacts of climate change. This includes physical infrastructure, like coastal protections, upgraded water and sewer infrastructure, and heat mitigation, but also public health campaigns, for example to help protect residents from the effects of extreme heat.
The mayor, Comptroller Scott Stringer and other trustees of New York City’s $189 billion pension funds also announced a goal to divest city funds from fossil fuel reserve owners within five years, which would, they said, make New York City the first major US pension plan to do so.
The mayor and comptroller are to submit a joint resolution to pension fund trustees to begin analysing ways to divest from fossil fuel owners in a responsible way that is fully consistent with fiduciary obligations. In total, the City’s five pension funds hold roughly $5 billion in the securities of over 190 fossil fuel companies.
The mayor said that the first step is for the trustees at each fund to instruct the Office of the City Comptroller’s Bureau of Asset Management (BAM) to commission an analysis of the proposed divestment and advise the trustees as to the anticipated impact on the risk and return characteristics of the portfolio. The trustees will also seek legal opinion as to whether carrying out the divestment would be consistent with trustees fiduciary duties to beneficiaries. Assuming a positive legal opinion, the trustees would then instruct BAM to carry out the divestment with specified steps and timelines. In the case of this divestment, transactions would likely be carried out in stages in order to reduce transaction and implementation costs.
Mayor de Blasio said: “New York City is standing up for future generations by becoming the first major US city to divest our pension funds from fossil fuels. At the same time, we’re bringing the fight against climate change straight to the fossil fuel companies that knew about its effects and intentionally misled the public to protect their profits. As climate change continues to worsen, it’s up to the fossil fuel companies whose greed put us in this position to shoulder the cost of making New York safer and more resilient.”Last Updated: 12 January 2018