State lawmakers in Oregon guide the state retirement fund to tackle climate-related hazards
In a significant move towards sustainable investing, the US state of Oregon has approved a bill directing its state treasurer to build a more climate-resilient retirement fund for public workers. This marks the first time one of such plans has received the backing of a state legislature.
The bill, proposed by Senator Michael Dembrow, is part of a growing trend in the United States. In 2024, Oregon joined peers in New York City, New York State, and California (CalPERS and CalSTRS) in passing sustainable investing plans for their state pensions.
The legislation directs the treasury to produce regular reports to the legislature and confirms its fiduciary responsibility to retirees. It encourages the state treasury to support the transition to a cleaner energy future in its management of about $101bn in the public employee pension fund.
The Sierra Club applauded Oregon's legislators for passing the bill that mandates the state's public pension to implement its sustainable investing plan. The organization had earlier published a report in February, ranking the Oregon state pension fund sixth out of 32 US state pension funds in terms of its response to the climate crisis. Notably, the report did not mention any specific issues with the Oregon state pension fund's sustainable investing plan.
The Sierra Club's director of the Oregon chapter, Damon Motz-Story, stated that Oregon's communities are already preparing for and responding to extreme wildfires, a clear signal of the worsening climate crisis. He emphasised the importance of the state's pension fund adopting a sustainable approach to investment.
State treasurer Elizabeth Steiner stated that the climate resilience investment act protects employee retirement funds by enabling Treasury's investments to take full advantage of the opportunities the clean energy transition creates.
Campaigners are calling on trustees to make sustainable investment decisions and use their voting power to push companies they invest in to go green. The pressure is mounting on pension funds to take more account of climate change risks.
According to analysis by Ortec Finance, US and Canadian pension fund returns could fall up to 50% by 2040 if predictions for the worst global warming materialise and if the current approach to climate policy doesn't change. Tim Miller, director of Oregon Business for Climate, stated that the world is moving toward a carbon-free future and it's not turning back, creating opportunities for innovation and growth for companies and investors who are able to adapt.
This article was last updated on June 20, 2025. The Trump administration, however, plans to overturn a rule that allows pension funds to consider ESG factors when making investment decisions and exercising shareholder voting rights, potentially creating a conflict with the state-level sustainable investing initiatives.
Two bills reintroduced in New York's senate would require climate disclosure rules similar to those adopted by California in 2023. Meanwhile, a bill requiring greenhouse gas emissions disclosures was introduced in Colorado in January, signaling a broader movement towards sustainable investing across the United States.
