The June 12 news article regarding the funding of pensions ("Clock ticking on Minnesota pension changes") potentially addresses only the one-third of that important pension equation that comes from public employers and employees. Two-thirds of all payouts from a pension plan come from investment return on assets. I submit that the state needs to look at that part of the equation as well.

As a past pension commission member and chair of the House Government Operations Committee, I led many pension reforms, including acting on just one omnibus pension bill instead of several dozen individual bills, thereby saving hours of legislative time, requiring disclosure of the returns from volunteer firefighter pension plans and encouraging hundreds of local pension funds to use the State Board of Investment (SBI) instead of cash accounts in local banks, with a dramatic increase in returns.

This past legislative session I tried (and failed) to amend the pension bill to ask the SBI to address the climate-change issue and in the process make a better return on investment. This was based on a new law in California. My amendment would require the SBI to develop climate-change risk-management strategies, including a requirement for corporate boards to have members knowledgeable in the issue and taking account of it.

And this wasn't some wacko, do-good environmental measure. This is about the cold, hard cash needed to pay for pensions. The idea is based on an adopted policy from Yale University's investment plan. Yale's fiscal year 2015 return was 11.5 percent, compared with Minnesota's SBI return of 4.4 percent.

Yale requests that its investment managers assess the greenhouse-gas footprint of prospective investments, the direct consequences of climate change on expected returns and the cost of policies aimed at greenhouse-gas emissions on expected returns. Yale has turned down investments in companies that refused to acknowledge the possible effects of climate change. And fossil-fuel companies are getting clobbered in the capital markets: fossil-fuel stocks are running 20 percent to 30 percent behind the S&P 500 index over the last two years. The marketplace has finally realized the true costs of this industry. The energy world is changing even as you read this article. We need to change with it.

In the June 12 article, returns are mentioned only as requiring a lower projection rather than as possible improvement of returns. This leads to the next question. Isn't this an issue we should examine, since the financial viability of a pension plan depends roughly two-thirds on investment returns and one-third on employer and employee contributions?

Phyllis Kahn, DFL-Minneapolis, is a member of the Minnesota House.