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December 04, 2015 | Press Releases

New York State Common Retirement Fund Develops a Risk Aware, Low Emissions Equity Investment Program with Goldman Sachs Asset Management


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$2bn Low Emissions Investment by CRF is Extension of GSAM Strategic Partnership

New York, New York – December 4, 2015 – Goldman Sachs Asset Management (“GSAM”) is pleased to work with the New York State Common Retirement Fund (CRF) in developing a Risk Aware, Low Emissions Equity Investment program.

Working with GSAM, CRF will commit $2 billion to this strategy within its U.S. equity portfolio to invest in companies that in aggregate will have greenhouse gas emissions that are up to 70 percent lower than that of CRF’s US large cap equity benchmark.

“GSAM is committed to helping our clients achieve their environmental, social and governance (“ESG”) investing objectives. We are pleased to support CRF in its goal of lowering the carbon emissions profile of its portfolio in a prudent risk aware manner. We are gratified that CRF has chosen GSAM as its partner in this important initiative,” said Hugh Lawson, Global Head, ESG and Impact Investing at GSAM.

“Our goal is to bring sophisticated risk management and portfolio construction techniques to ESG investing for our clients. The approach CRF has taken is distinctive in substantially reducing the emissions profile of its portfolio while maintaining a similar risk and return profile to its policy benchmark and a strong link with its ongoing corporate engagement efforts,” said Hugh Lawson.

The program will use a methodology developed by CRF and GSAM that seeks to reduce CRF's equity ownership of companies with higher greenhouse gas emissions while staying within a defined risk tolerance. This “Risk-Aware, Low-Emissions” methodology seeks to harness GSAM's history of incorporating ESG risk factors as part of an investment approach and the firm's portfolio construction expertise. Combining independent Carbon Disclosure Project (CDP) emissions data with a risk-aware methodology, the process aims to dynamically reduce the carbon emissions footprint of CRF’s portfolio with a high degree of efficiency per unit of relative risk to CRF’s chosen market-cap based index.

The new portfolio was developed as an extension of the existing strategic partnership between CRF and GSAM. CRF's U.S. equity team will be responsible for implementing the environmentally focused investment program and in working with GSAM, seeks to bolster its portfolio management capabilities in low-carbon investing.

Goldman Sachs Asset Management is the asset management arm of The Goldman Sachs Group, Inc. (NYSE: GS), which oversees $1.19 trillion as of September 30, 2015. Goldman Sachs Asset Management has been providing discretionary investment advisory services since 1988 and has investment professionals in all major financial centers around the world. The company offers investment strategies across a broad range of asset classes to institutional and individual clients globally. Founded in 1869, Goldman Sachs is a leading global investment banking, securities and investment management firm that provides a wide range of financial services to a substantial and diversified client base that includes corporations, financial institutions, governments and high-net-worth individuals.

Media Contact:
Andrew Williams Tel: 212-357-0005

Press Release from the Office of the New York State Comptroller