Vermont Business Magazine Treasurer Mike Pieciak today joined 16 state financial leaders from across the country in calling on leading asset managers to uphold their fiduciary duty by fully considering climate risk in investment decisions.
The letter from Treasurer Pieciak and colleagues stands in clear contrast to a letter released last month by the State Financial Officers Foundation (SFOF), a right-wing association of state financial officers. SFOF urged asset managers to scale back proxy voting, oversight of corporate behavior, and consideration of issues like climate change in investment strategies.
Public pension funds—including those in Vermont—rely on asset managers to invest retirement savings on behalf of teachers, firefighters, and other public employees. Through practices such as proxy voting, shareholders can hold these asset managers accountable and ensure investment decisions reflect long-term risks and opportunities.
SFOF’s approach seeks to weaken these accountability tools and prevent asset managers from factoring in labor practices, environmental risk, and anti-discrimination policies when allocating investments. Pieciak and his colleagues argue this misrepresents fiduciary duty and threatens the long-term financial security of retirees.
“As fiduciaries of public funds, it is our duty to make sure the companies we invest in are accountable and create long-term value for retirees—that requires a fair and honest assessment of risk,” said Treasurer Pieciak. “Climate change is here, and it is already impacting people’s lives and creating serious risks in the economy. If we ignore those risks, we’re gambling the retirement of our teachers, firefighters, and public employees.”
The letter underscores several key points:
- Fiduciary duty requires consideration of long-term risks and opportunities. Pension funds and other institutional investors are permanent owners in the market. They bear the consequences of unmanaged risks—from climate change to corporate governance failures to supply chain vulnerabilities.
- Shareholder rights must be protected. The letter emphasizes that CEOs and boards of directors are accountable to shareholders—including teachers, firefighters, and public employees—not the other way around.
- Concentration of market power demands engagement. The top 100 companies represent more than 70% of U.S. market value. Pension funds cannot avoid investment in these companies, making oversight essential for protecting our pensions.
- Accountability safeguards investment returns. Proxy voting and corporate engagement are essential mechanisms to safeguard durable, risk-adjusted returns for beneficiaries.
Together, the signers of the letter collectively oversee more than $3 trillion in public pension assets—far exceeding the less than $2 trillion represented by the states aligned with SFOF.
State financial leaders who signed the letter have invited asset managers to respond by September 1, 2025, and to meet with their offices to reaffirm commitments to responsible stewardship.
8.21.2025. Montpelier, VT – Treasurer
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