Alaska | Ropes & Gray LLP

State Regulations

Legislation/Guidance in Effect

Title

Key Dates

Nature of
Action

ESG Category

Summary

Exxon Mobil Takes On Climate Extremists

Introduced

5/30/2024

Treasure Position

Restrict Use of ESG Factors; Focus on Pecuniary Characteristics

■ Op-ed published in the Wall Street Journal by Alaska's Commissioner of Revenue Adam Crum, which criticizes CalPERS' opposition to Exxon Mobil's effort to seek withdrawal of a shareholder proposal pushing emissions-reduction targets that could undermine Exxon Mobil's business operations.

■ Commissioner Crum mentions the key role that oil and gas have played in Alaska's economic growth, and he also notes how shareholders had already rejected previous similar climate proposals. Finally, he contrasts CalPERS from his approach in Alaska, where they "apply prudent investment rules and practices as prescribed by state statutes to maximize investment performance" and "don’t use residents’ dollars to advance a fiscally irresponsible activist agenda." He states that Alaska will "continue to work with responsible resource-development companies including Exxon Mobil to ensure a prosperous future for Alaska for generations to come.”

Past/Inactive Legislation

Title	Key Dates	Nature of Action	ESG Category	Summary
HB303: An Act Relating to the Duties of the Alaska Retirement Management Board; Relating to the Duties of the Board of Trustees of the Alaska Permanent Fund Corporation	Introduced, but did not pass the 2024 legislative session	Legislation	Restrict Use of ESG Factors; Focus on Pecuniary Characteristics	■ Requires the board of a defined benefit retirement plan in exercising its duties to (1) act solely in the pecuniary interest of plan members and beneficiaries, (2) vote all shares held directly or indirectly by or on behalf of the plan solely in the pecuniary interest of members and (3) not rely on nonpecuniary factors when (a) evaluating an investment or evaluating or exercising a right to appurtenant to an investment;(b) promote a nonpecuniary benefit or goal; (c) rely on an ESG or other similar consideration as a pecuniary factor unless (a) the consideration presents economic risk or opportunity that a qualified investment professional would consider material; under generally accepted investment theories; (B) the board relies on a prudent assessment of risk and return when weighing the consideration; (C) the board examines the level of diversification, degree of liquidity, and the potential risk and return of the consideration compared with available alternative investments that would play a similar role in the fund portfolio. ■ "nonpecuniary" includes an action taken or factor considered by the board with a purpose to further ESG or ideological goals. ■ "pecuniary" means materially affecting the financial risk or financial return of an investment based on appropriate investment horizons consistent with plan investment objectives and funding policy.
HB174: An Act Restricting Fiduciary Actions by a Fiduciary of a State fund, the Alaska Retirement Management Board, and the Alaska Permanent Fund Corporation Board that Have the Purpose of Furthering Social, Political, or Ideological Interests	Introduced, but did not pass in the 2023 legislative session	Legislation	Restrict Use of ESG Factors; Focus on Pecuniary Characteristics	■ Prohibits the fiduciary of a state fund, the Alaska Retirement Management Board, or the Alaska Permanent Fund Board from taking an action involving investment for the purpose of furthering a social, political, or ideological interest. ■ An action is considered to have the purpose of furthering a social, political, or ideological interest if evidence indicates a commitment to (1) eliminating, reducing, offsetting, or disclosing greenhouse gas emissions; (2) instituting or assessing corporate board or employee composition, compensation, or disclosure criteria based on social, political, or ideological characteristics or practices; (3) divesting from, limiting investment in, or limiting the activities or investments of a company for failing or not committing to meet environmental standards or disclosures; (4) providing or limiting access to abortion, sex or gender change, or transgender surgery; or (5) divesting from, limiting investment in, or limiting the activities or investments of a company for engaging in, facilitating, or supporting the manufacture, distribution, sale, or use of firearms.
HB394: Investment of State Money and Divestment of Certain Investments by Public Agencies	Introduced, but did not pass in the 2023 legislative session	Legislation	Target Entities that Boycott Certain Industries	■ Restricts public agencies from investing state money in organizations that (i) promote or engage in a boycott or divestment campaign targeting Alaska, or (ii) target the autonomy of Taiwan or the existence of a foreign country. ■ The Alaska Department of Revenue shall develop and maintain a publicly available list of organizations that it determines are restricted organizations and shall provide 90 days’ written notice to an organization before including it on the list.