A nonprofit financial watchdog organization is urging Oregon lawmakers to pass Senate Bill 681, which aims to integrate sustainability into the state's private market investments. During a recent Senate Committee on Finance and Revenue meeting, representatives highlighted the urgent need for transparency and accountability in the private equity sector, particularly in light of the escalating climate crisis.

The organization emphasized that climate change could cost the global economy a staggering $38 trillion annually by 2049, threatening nearly 20% of global income. Despite the significant growth of private markets, which now total nearly $15 trillion, much of the investment has been funneled into fossil fuels, leaving a substantial portion of the economy without necessary regulatory oversight.

The Oregon Public Employees Retirement Fund (OPRF), with $35 billion invested in private equity and real assets, is particularly vulnerable. Research indicates that 21 private equity firms are responsible for over 1.17 gigatons of annual emissions, with OPRF's portfolio heavily exposed to carbon-intensive assets. A recent report found that while private equity and real assets made up 38% of OPRF's portfolio, they accounted for over 45% of its total emissions.

The organization argues that implementing policies to transition away from carbon-emitting investments is crucial for protecting the pension system and mitigating financial risks. By passing SB 681, Oregon could set a precedent for sustainable investment practices, leading the way in addressing climate-related financial challenges.