December 27, 2021
Should climate-related requirements be one component of a broader ESG disclosure framework? YES
Climate Change guidance for individual investors is essential.
SEC Chair Gary Gensler has been clear that he intends to bring transparency and credibility to ESG investors in the US.
As an 80 year old grandmother of four teenager, I support Chair Gensler's goal and will tell you why this is imperative.
I invest my own retirement account through Vanguard and I invest in a 529 plan for each of my four grandchildren through my state's EDvest program, which is administered by TIAA Cref.
Both Vanguard and TIAA Cref offer what are identified as ESG funds among their investment options. But the disclosures of what exactly those funds include or exclude are very difficult to find. A prospectus is available for one of the Vanguard funds, but it includes very loose screen-out criteria for fossil fuel or fossil fuel pipeline companies. Many such companies are still included in those funds. In the case of the TIAA Cref ESG fund in my state's 529 fund, it is even more difficult to determine which fossil fuel companies are included or screened out.
I am particularly concerned about ESG funds inclusion of fossil fuel pipeline companies that carry tar sands oil from Alberta. The Enbridge Pipeline Line 3 carries tar sands oil from Canada through North Dakota and Minnesota on route to a terminal in my state, at Superior WI. There, Line 3 connects with Enbridge Pipeline Line 61 which runs through my state and my county, Dane County WI.
In my investment decisions for myself and my grandchildren, I wish to be able to exclude fossil fuel companies in general, and this fossil fuel pipeline company, in particular, which directly affects the future of my grandchildren and the safety of the land, water and air of my state. Current rules for ESG funds are woefully inadequate when it comes to screening out fossil fuels. Thus, to the question: \"Should climate-related requirements be one component of a broader ESG disclosure framework?\"
My unequivocal answer is YES. Thank you.