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US Federal Thrift Savings Plan Criticised for Fossil Fuels Investments

Analysis by As You Sow found the Federal Thrift Savings Plan (TSP) has more than US$35 billion invested in coal, oil, and gas companies. TSP, which is responsible for managing US$725 billion in retirement savings for six million participants, has invested US$9.7 billion in ten major oil and gas corporations, including Exxon Mobil, Chevron, and ConocoPhillips. The non-profit’s analysis primarily focused on the equity and target date options offered within the TSP and rated nearly all of them with a disappointing D or F grade for their significant exposure to fossil fuel companies, some of which reached as high as 10%. As You Sow CEO, Andrew Behar, said: “If the TSP continues to ignore climate risk, plan participants could face financial losses from stranded assets and other climate-related financial risks. The federal government should be protecting its employees’ nest-egg savings from the economic consequences of climate change, not sweeping this risk under the rug.” The analysis comes in the wake of an Executive Order by the President, which sought information on the TSP’s approach to climate risk. Despite legal constraints, experts suggest that the TSP could take measures to safeguard workers’ savings, emphasising the need for fiduciary responsibility, including evaluating and managing climate-related financial risks. Behar noted: “The Federal Retirement Thrift Investment Board’s fiduciary duty compels it to ensure that its chosen asset managers are voting in a way that minimises climate-related financial risk.”

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