Comptroller Lander Recommends Pension Boards Drop BlackRock, Fidelity, and PanAgora Due to Inadequate Decarbonization Plans

New York, NY — Today, New York City Comptroller Brad Lander released a Net Zero Implementation Plan update to trustees of the New York City Employees’ Retirement System (NYCERS), Teachers’ Retirement System (TRS), and Board of Education Retirement System (BERS). The update recommends that the three Systems rebid BlackRock’s U.S. public equities index mandates and terminate those of active managers Fidelity and PanAgora. The recommendation follows a robust evaluation of the pension systems’ 49 public market managers. While 46 of the systems’ public markets managers submitted decarbonization plans that align with New York City’s Net Zero Implementation Plans, three asset managers failed to meet the Systems’ climate expectations. 

In 2023, the trustees of NYCERS, TRS, and BERS adopted Net Zero Implementation Plans (NYCERS Plan, TRS Plan, BERS Plan), committing their funds to achieve net zero emissions by 2040. The plans committed the funds to (1) set interim targets and disclose emissions; (2) engage asset managers and portfolio companies to be net-zero aligned; (3) invest in climate change solutions; and (4) divest to reduce risk. As announced earlier this year, the Systems have collectively achieved a 37% reduction in financed greenhouse gas emissions since the baseline of 2019, divested fossil fuel reserve owners, and scaled up climate solutions investments to $11.9 billion—while achieving strong returns (10.5% for FY25, exceeding the actuarial target of 7%).   

The Net Zero Implementation Plans adopted in 2023 required public equity and corporate bonds managers to submit decarbonization strategies by June 30, 2025, outlining how they are aligned with the Systems’ expectations, including how they actively engage with portfolio companies to mitigate climate risk. All 49 of the Systems’ public markets managers submitted plans. Today’s recommendations are based on a thorough analysis of those submissions. 

“The systemic risk of the climate crisis threatens the long-term value of New York City’s pension funds,” said New York City Comptroller Brad Lander. “Our Net Zero plan is a core part of our fiduciary duty to protect these assets. I am pleased to report that 46 of our 49 public markets managers are aligned with our expectations for decarbonization; unfortunately, three are not. Today, I am calling on my fellow trustees to move our money away from the three asset managers – BlackRock, Fidelity, and PanAgora – who fail to address climate risk with the seriousness we expect.”  

Key Manager Recommendations: 

• BlackRock: Following Trump Administration changes in reporting requirements to the SEC, BlackRock recently announced it has ceased proactive engagement on proxy voting issues with U.S. companies where it owns 5% or more. As a result, its engagement does not sufficiently encourage portfolio companies to take concrete decarbonization actions, such as setting net-zero goals, adopting science-based targets, or aligning lobbying and capital expenditures with climate goals. While BlackRock claims this was necessary to comply with the new requirements, other large asset managers (e.g., State Street) maintain a much more robust approach to climate engagement. The review also identified other shortcomings with BlackRock’s climate stewardship. While BlackRock did expand access to its Climate and Decarbonization Stewardship policy as part of its response, the submission still does not meet the Systems’ expectations. As a result, Comptroller Lander is calling on NYCERS, TRS, and BERS trustees to approve a search to rebid BlackRock’s $42.3 billion in U.S. public equity index mandates. 

• Fidelity: Fidelity also adopted an overly restrictive interpretation of SEC guidance, applying it to both U.S. and non-U.S. companies to prevent influencing them on decarbonization, even when such action is financially material (BlackRock’s rollback only covers U.S. companies). Given this refusal to engage with portfolio companies on a critical systemic risk, Comptroller Lander recommends that TRS terminate Fidelity’s World ex-US small-cap mandate and develop a reallocation strategy for its $384 million in assets. 

• PanAgora: As the systems’ only quantitative manager to adopt such a restrictive approach, PanAgora’s engagement on climate is limited to disclosing emissions. It fails to encourage companies to take decarbonization actions—like setting emissions targets or adopting transition plans—even when such actions could be beneficial to the company. Comptroller Lander recommends NYCERS and TRS terminate PanAgora’s U.S. small-cap equity mandate. 

Direct Engagement 

Direct engagement with the Systems’ highest-emitting portfolio companies, independently from our asset managers, is a cornerstone of the work of TRS, NYCERS, and BERS on Net Zero. All of the Systems’ Net Zero corporate engagement work is predicated upon the understanding that as long-term investors and fiduciaries, the Systems must be a strategic partner for its portfolio companies throughout the Net Zero transition.  

Our engagement strategy focuses on setting science-based targets as a first step toward the creation of a clear roadmap to achieve Net Zero by 2040. To date, Comptroller Lander and the Bureau of Asset Management have engaged with over 100 public companies on this topic. 

Among the highest emitting sectors, the Office has spent substantial time focusing on utilities, which collectively represent about 20-30% of the Systems’ financed emissions. The Office served as a stakeholder on an advisory group convened by the Electric Power Research Institute that is aimed at creating a target-setting protocol for utilities called “SMARTargets.” Unfortunately, despite ongoing efforts, SMARTargets is not yet an acceptable methodology for target setting and presents a significant greenwashing risk. 

The Office is committed to working with the industry to reach a mutually agreeable outcome on this issue, but cannot accept a methodology that would enable “greenwashing.” To that end, Comptroller Lander recently convened over 60 individuals representing asset owners, managers, utility companies, and service providers to address this issue and identify a path forward that provides investors with the tools and information they need to engage with their portfolio companies on decarbonization and other efforts to mitigate climate-related risk. 

Midstream and Downstream Proposal 

In June 2025, Comptroller Lander proposed to the Systems’ Boards that they cease future investments in midstream and downstream fossil fuel infrastructure. This policy would add a provision to the existing prohibition on upstream fossil fuel investments in private markets that the Systems adopted in 2023. In the memo issued today, Comptroller Lander reiterated this proposal and urged the trustees to adopt it.  

Excluding investments in pipelines and LNG terminals will help mitigate the systemic risks climate change poses to the global economy and the Systems. Taking this step ensures the Systems’ private markets investments are not financing fossil fuel infrastructure that undermines the Paris Agreement’s climate goals, protecting both the planet and the long-term investment returns needed to fund NYC employees’ pension benefits. 

###