Key Takeaways
- • Tom Steyer, billionaire California gubernatorial candidate and self-described climate activist, maintains significant passive investments in Farallon Capital, the hedge fund he founded and left in 2012, contradicting his public positioning as having "walked away" from finance to pursue climate action.
- • Farallon Capital has substantially increased lending to coal industry projects in recent years, including financing coal mining operations and infrastructure in Australia, as major banks retreated from fossil fuel investments under environmental pressure.
- • Steyer's disclosed holdings in Farallon dropped from at least $110 million during his 2020 presidential campaign to approximately $34 million in more recent filings, though he continues to maintain a stake despite claims of fossil fuel divestment.
- • Steyer's campaign states that employees at Farallon screen his portfolio to remove fossil fuel-related holdings and that he no longer earns a share of fund profits, positioning him as a passive investor with limited decision-making authority.
- • The ongoing financial connection between Steyer and a firm actively financing coal expansion creates a credibility vulnerability for a candidate positioning himself as an outsider committed to addressing climate change and making California more affordable.
Summary
Tom Steyer's presidential and gubernatorial campaigns have centered on climate activism and positioning himself as a political outsider willing to invest his wealth in progressive causes. However, financial records reveal that the billionaire investor has maintained continuous ties to Farallon Capital, the San Francisco-based hedge fund he founded, even after stepping down as CEO in 2012. This connection has drawn scrutiny from climate advocates and media outlets, as Farallon has increasingly financed coal projects globally—a strategic pivot that occurred as traditional banks withdrew from fossil fuel lending under activist pressure.
Farallon's expanded coal financing includes significant lending to mining operations and related infrastructure, particularly in Australia. The firm has effectively filled a financing gap left by major financial institutions that faced environmental pressure to divest from fossil fuels. Will Van De Pol, a climate advocate cited in reporting by the New York Times, emphasized the contradiction: "Anyone closely connected to Farallon and its investment decision-making that claims commitment to climate action needs to be heavily scrutinized for the negative climate impacts of Farallon's decisions."
Steyer's campaign has responded by clarifying that he functions as a passive investor with limited operational control. According to the campaign's statement, Farallon employees actively screen his personal portfolio to exclude fossil fuel-related holdings, and Steyer no longer receives a share of fund profits. Financial disclosures support the decline in his stake: his Farallon holdings were valued at approximately $110 million during his 2020 presidential run but have decreased to roughly $34 million in more recent filings.
The persistence of Steyer's financial ties to Farallon, combined with the fund's coal industry expansion, creates a narrative tension for a candidate emphasizing climate commitment and outsider status. The disclosure highlights broader questions about wealth management practices among billionaire political candidates and the gap between public positioning and underlying financial interests, particularly relevant for investors evaluating political risk and ESG-aligned investment strategies in California.
Farallon's expanded coal financing includes significant lending to mining operations and related infrastructure, particularly in Australia. The firm has effectively filled a financing gap left by major financial institutions that faced environmental pressure to divest from fossil fuels. Will Van De Pol, a climate advocate cited in reporting by the New York Times, emphasized the contradiction: "Anyone closely connected to Farallon and its investment decision-making that claims commitment to climate action needs to be heavily scrutinized for the negative climate impacts of Farallon's decisions."
Steyer's campaign has responded by clarifying that he functions as a passive investor with limited operational control. According to the campaign's statement, Farallon employees actively screen his personal portfolio to exclude fossil fuel-related holdings, and Steyer no longer receives a share of fund profits. Financial disclosures support the decline in his stake: his Farallon holdings were valued at approximately $110 million during his 2020 presidential run but have decreased to roughly $34 million in more recent filings.
The persistence of Steyer's financial ties to Farallon, combined with the fund's coal industry expansion, creates a narrative tension for a candidate emphasizing climate commitment and outsider status. The disclosure highlights broader questions about wealth management practices among billionaire political candidates and the gap between public positioning and underlying financial interests, particularly relevant for investors evaluating political risk and ESG-aligned investment strategies in California.
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