Climate change poses growing, systemic risk to the economy. If global climate goals are not met, workers face the likelihood of significant negative impacts to their retirement portfolios. Swiss Re estimates a 4% decline in global GDP by 2050 if global temperature increases are kept below 2 degrees Celsius, but up to an 18% decline without effective mitigation. Comcast has taken certain actions to address climate change, for example, by committing to reach carbon neutrality for Scope 1 and 2 emissions, across its global operations, by 2035.[2] Yet, while decarbonizing part of its business, Comcast’s 401(k) retirement plan (“Plan”) continues to invest significantly in companies that contribute to climate change, jeopardizing workers’ life savings. Our Company’s employee retirement funds are automatically invested in the Plan’s default investment option unless employees proactively choose different investments. Thus, the majority of the Comcast Plan’s $17.6 billion in assets are invested in its default option.
Comcast has selected Vanguard Target Retirement funds as the Plan’s default offering. These funds invest significantly in fossil fuel companies and companies contributing to deforestation.[4] By investing employees’ retirement savings in companies with outsize contributions to climate change, Comcast is generating climate risk, including transition risk and long-term systemic risk, to workers’ portfolios. Comcast’s default 401(k) choice risks compromising its obligation to select retirement plan investment options in the best interests of its plan participants, including those with retirement dates more than a decade out.In the increasingly competitive employee recruitment and retention landscape, failing to minimize material climate risk in its 401(k) Plan default option may make it more difficult for Comcast to attract and retain top talent. Employee polling indicates that firms’ environmental records are an important consideration in choosing a job.[5] Employee polling also reveals increasing demand for climate-safe retirement plan options.
Given the threat that climate change poses to employee’s life savings, our Company can help ensure employee loyalty and satisfaction, and demonstrate that it is actively safeguarding all employee retirement savings, no matter when they are set to retire, by minimizing climate risk in its Plan offerings, especially in its default option. The federal government recently clarified that fiduciaries may appropriately consider climate risk in the selection of plan offerings, including in the default option.