‘Interesting Precedent’ May Be Set in Lawsuit Over NYC Using Pension Funds for a Political Agenda: Kevin Stocklin

Investment based on environmental, social, governance, or ESG, is under fire in a legal challenge in New York City. Public workers are suing the city, alleging it is “abusing” its pension fund to pursue a political agenda, thus hurting their investment’s bottom line. The city claims it is carrying out good risk management as it invests in climate and social justice considerations.

Kevin Stocklin, the producer of “The Shadow State” documentary on ESG concerns, believes the state of New York pushes its pension funds to invest using ESG criteria and that the courts must determine how much of an impact this is having on the return on investment.

He said this will set a “very interesting precedent whether or not this is a good investment tool, or whether this is using your money to support political causes.”

Stocklin cites studies from Harvard and Columbia University that say ESG can reduce returns by 0.75 to 1 percent. Stocklin said a percent reduction can lead to an enormous difference in the funds available for a person’s retirement.

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