INSIGHT by California State Teachers’ Retirement System (CalSTRS)

For the 2023 proxy season, the California State Teachers’ Retirement System—the world’s largest educator-only pension fund with more than $315 billion in assets—stepped up its efforts to hold companies around the globe accountable for failing to address climate change risks: CalSTRS voted against the boards of directors at a record 2,035 global companies because they did not provide necessary climate risk disclosures.

In 2021, CalSTRS made a pledge to achieve a net zero investment portfolio by 2050, or sooner. The steps CalSTRS takes to achieve net zero carbon emissions are rooted in its mission to provide California’s public school teachers with a secure financial future. As a part of this mission, CalSTRS will continue to hold the companies in its global portfolio accountable for addressing sustainable business practices and providing minimum climate risk disclosures to investors.


“We voted against boards that didn’t meet the most basic disclosure expectations. These public disclosures are an important step toward reaching net zero because companies cannot be held accountable for reducing their greenhouse gas emissions without them.”

-Aeisha Mastagni, a portfolio manager on CalSTRS’ Sustainable Investment and Stewardship Strategies team


The risk of climate change broadly impacts CalSTRS’ investment portfolio, which is why CalSTRS voted against the boards of directors of many industries this year, including steel producers, transportation companies, and metal and mining companies. CalSTRS exercises this important shareholder right because companies consider votes against their directors as a serious action.

Climate change is one of the greatest threats to the planet and extreme weather events and wildfires are intensifying. As a result, CalSTRS wants to know if the companies in its portfolio are planning appropriately for the future by actively working to take advantage of opportunities to reduce the risks of climate change.

At a minimum, CalSTRS expects its portfolio companies to report their direct greenhouse gas (GHG) emissions (also known as scope 1 emissions), indirect emissions (scope 2), and climate reports based on the recommendations of the Task Force on Climate-Related Financial Disclosures. These companies are also expected to curb—or at least have a credible plan for curbing—their GHG emissions.

Currently, there are no globally mandated rules for climate risk disclosures. This complicates the process of assessing whether a company is properly disclosing its risks and opportunities associated with climate change.


“We need to make informed decisions to manage our portfolio on behalf of California’s educators, but that job is made more difficult if companies aren’t fully measuring and tracking their emissions. Fortunately, we believe mandatory GHG emissions reporting is on the horizon.”

-Aeisha Mastagni, a portfolio manager on CalSTRS’ Sustainable Investment and Stewardship Strategies team


For years, CalSTRS has been encouraging the U.S. Securities and Exchange Commission (SEC) to establish minimum climate-disclosure standards for companies to follow, which would enable investors to make investment decisions based on relevant and reliable data. While SEC-mandated standards do not currently exist, investment experts are hopeful the SEC will finalize enforceable and practical climate-disclosure rules before the end of 2023.

Meanwhile, CalSTRS welcomes the International Sustainability Standards Board’s (ISSB) first two sustainability-related disclosure standards, an important milestone for setting globally comparable standards. Released in June 2023, these standards will go into effect in January 2024 and help establish consistency in companies’ sustainability disclosures.

The ISSB is expected to partner with the SEC and jurisdictions around the world to establish minimum climate-disclosure standards for companies, which will make it easier for investors to assess how a company’s climate-related risks and opportunities will impact their portfolio.

For CalSTRS, the ultimate goal is to influence and expedite corporate practices that support its mission to achieve a net zero portfolio—which in turn will help protect the planet—and ensure California’s public educators have a secure retirement for generations to come.

See CalSTRS’ Path to net zero and proxy voting records for more information.


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CalSTRS provides a secure retirement to more than 1 million members and beneficiaries whose CalSTRS-covered service is not eligible for Social Security participation. On average, members who retired in 2021–22 had 25 years of service and a monthly benefit of $4,809. Established in 1913, CalSTRS is the largest educator-only pension fund in the world with $315.6 billion in assets under management as of June 30, 2023. CalSTRS demonstrates its strong commitment to long-term corporate sustainability principles in its annual Sustainability Report.


All opinions expressed are those of the author and/or quoted sources. is an independent and neutral platform dedicated to generating debate around ESG investing topics.