Andrew Siwo is the Head of Sustainable Investments and Climate Solutions (SICS) at the New York State Common Retirement Fund and reports to the Chief Investment Officer. He is charged with providing leadership and oversight on sustainable investment efforts across the Fund’s $272 billion portfolio and is the portfolio manager for the Fund’s $40 billion commitment to SICS.

Previously, Siwo was an Investment Director and served as the Head of Mission-Related Investments (MRIs) at Crewcial Partners, an investment consultancy to over 150 leading foundations and endowments with an aggregate of $40 billion in assets under advisement.

Given your leadership in the sustainability space, what do you see as the biggest challenges and opportunities in aligning investment strategies with long-term environmental, economic, and social resilience?

A challenge that large asset owners in the sustainable capitalism field can face is appropriately isolating secular trends that contain institutional investment heft. Our solution is to invest through a set of clear climate-oriented and inescapable economic themes. For example, we have made investments in multi-family real estate that address housing unaffordability and in climate-oriented index funds designed to mitigate the Fund’s exposure to environmental risks. Opportunities, conversely, can arise from being nimble and having the wherewithal and operational path to execute compelling opportunities. 

Comptroller Thomas DiNapoli, the Fund’s sole trustee, has a long-standing awareness of the risks that climate change can impose on investment assets. While the SICS portfolio was formalized in 2020, the Comptroller’s lengthy leadership tenure has provided the Fund with stability to execute critical objectives. I report to the Chief Investment Officer, Anastasia Titarchuk, who is an integral supporter of implementing the Comptroller’s vision. My role involves working across asset classes to source, assess, and adjudicate investments that we expect to be accretive. The Fund comprises incredibly talented and diverse staff across key functions such as risk, legal, and corporate governance teams—which is consequential to our work. Finally, as a modern fiduciary, we advocate considering all available data (including environmental, social, and governance factors) when making investment decisions.

The New York State Common Retirement Fund’s Climate Action Plan sets a framework for decarbonization and deploying capital to climate-related investments. What lessons have emerged from implementing your Climate Action Plan, and what’s next on the horizon?

Our metric for success has always been performance.  A lesson that was intuitive to us from the SICS portfolio’s inception is having a uniform structure. Put differently, our assessment and underwriting of sustainable investment products is conducted similarly to the Fund’s non-sustainable investment products. Moreover, our collaborative approach allows for the input of multiple viewpoints during due diligence to inform our thinking and analysis. We have an asset-class-driven investment approach—meaning that each successful investment outcome must meet the same fiduciary requirements applicable to investments in the subject asset class. As such, we anticipate that long-term performance will be essentially indistinguishable from the broader corpus. We have no higher objective than protecting and growing retirement assets.

Last year, the Fund doubled its sustainable investment target to $40 billion from $20 billion, which allows us to continue seizing suitable investment opportunities where appropriate. We have also noticed that table stakes across sustainable investments have perpetually risen, partly because investors are more sophisticated and also expect to be compensated appropriately for the risks taken.

As you look towards this year, what sectors or innovations are you most excited about right now?

We intend to increase our exposure to climate-oriented index funds and have been more active in multi-family real estate (affordable housing). As a result of population growth and an aging population, additional investments in healthcare, infrastructure, and other physical assets (e.g., data centers, cold storage) will be needed. To be globally competitive, asset managers will likely require factoring sustainable elements during construction and management.In terms of exciting areas, artificial intelligence (AI) presents risks and opportunities being monitored. Comptroller DiNapoli recently released an AI audit that provides several recommendations to safeguard against hazards and improve the responsible and transparent use of AI technologies. Further, we have an “opportunistic” asset class for investment opportunities that may not have a clear home; this sleeve allows us to target more niche areas—such as GP stakes, music royalties, aviation, and destinations that can generate an appropriate risk-adjusted return. We continue to remain cautiously optimistic and well-diversified in seeking optimal terms with LP-friendly managers to maximize expected returns to beneficiaries at a prudent level of risk.

Charting the Course is a monthly series featuring interviews with partners and investors in the Compass Investors network about how they are charting their course to create impact, manage long-term risk, and strive for a more just and humane world.