Wellington, CalPERS, and the Woods Hole Research Center Team Up

Wellington Management Co. and Woods Hole Research Center — the famous scientific institute located on Cape Cod — are jointly developing methods to model how the warming of the planet’s climate will affect global capital markets and investments. The California Public Employees’ Retirement System will test the two organizations’ investment models.

[II Deep Dive: Warren Buffett, Climate Change and the Billion-Dollar Challenge]

“We look forward to working with WHRC to thoroughly understand and accurately interpret the latest climate science research and the potential implications of climate change for capital markets,” said Wendy Cromwell, Wellington portfolio manager and director of sustainable investment, in a statement Monday. Wellington plans to use the results of the research in its investment decisions. 

Wellington — which has $1 trillion in assets and 2,000 institutional clients — and WHRC will build tools and analytical methods to improve climate change risk calculations for investments. Woods Hole also plans to publish papers using the data and models that come out of the initiative. The research center has been studying climate change since 1985, and works with public and private sector partners to put its science into practice.

Pension funds such as CalPERS have long been at the forefront of societal issues and have taken steps to support changes . The California State Teachers Retirement System, the other big California pension, has lobbied for more diversity, including women and minorities, on boards and at the companies in which it invests. 

Beth Richtman, CalPERS managing investment director, sustainable investments said, “As a long-term investor, we’re continually looking to sharpen our ability to analyze climate risk in our investment portfolio and in underwriting prospective investments.”