CLIMATE CHANGE RISK AND THE MARYLAND STATE RETIREMENT AND PENSION SYSTEM Climate Change Risk and the Maryland State Retirement and Pension System a report prepared by Matthew Binsted1, Nathan Hultman1*, Wes L. Hanson1, Alan Miller2, Travis St. Clair3 October 2017 1. Center for Global Sustainability, University of Maryland, College Park 2. Independent Consultant 3. NYU Wagner Graduate School of Public Service * Corresponding Author. Director, Center for Global Sustainability, 2101 Van Munching Hall, University of Maryland, College Park 20742. tel: 301-405-3429. email:
[email protected] The Center for Global Sustainability, based at the University of Maryland School of Public Policy, integrates research and policy engagement to inform discussions on climate, energy, environment, economic development, and sustainability. Located between Washington, DC and Annapolis, the Center focuses on developing research with immediate and significant impact on global, national, state, and local issues. Learn more at www.cgs.umd.edu. TABLE OF CONTENTS ACKNOWLEDGMENTS 5 ACRONYMS 6 EXECUTIVE SUMMARY 7 INTRODUCTION 9 CLIMATE RISKS ARE REAL AND CURRENT 12 Climate Risks and Implications 13 Risk Identification and Transparency in the Context of Fiduciary Duty 16 MARYLAND STATE RETIREMENT AND PENSION SYSTEM 18 State Retirement and Pension System Overview 19 State Retirement and Pension System Policies on Climate Change 20 INSTITUTIONAL INVESTMENTS AND CLIMATE CHANGE 21 Best Practices for Climate Risk Management 22 Pension Fund Responses to Climate Risk 25 How The