Pension fund urges more climate risk disclosure

By Rachelle Younglai

WASHINGTON (Reuters) - Calpers, the biggest U.S. pension fund, said on Wednesday that regulators already have the ability to require publicly traded companies to disclose material risks relating to climate change.

Calpers, which manages more than $250 billion, as well as other institutional investors, environmental groups and New York Attorney General Andrew Cuomo, had petitioned the U.S. Securities and Exchange Commission in September to force publicly traded companies to disclose climate-related risks.

The potential impact on companies' financial performance has garnered the interest of federal lawmakers, who held a hearing on Wednesday to discuss disclosure.

"There is sufficient authority currently at the SEC to compel disclosure," said Russell Read, Calpers's chief investment officer.

The coalition says risks associated with climate change can include effects on a company's performance and operations ranging from physical damage to new facilities to additional regulatory costs.

"Markets work best when they have accurate information," said Jack Reed, a Democrat from Rhode Island who chaired the Senate Banking subcommittee's hearing.

However, Reed agreed that the SEC could provide the guidance without additional legislation.

Sen. Joseph Lieberman, a Connecticut Democrat, introduced a bill in October designed to decrease emissions of greenhouse gases. That bill, America's Climate Security Act of 2007, includes a provision that would require the SEC to craft a rule requiring companies to disclose material risks relating to climate change. The bill has not left the Senate Committee on Environment and Public Works.