Commercial real estate giant Cushman & Wakefield publicly acknowledges that climate change poses a material threat to its own business. It has taken steps to insulate its balance sheet and sells clients expert advice on managing climate risks.
Yet, according to a first-of-its-kind class-action lawsuit filed March 3, 2026, in federal court in Seattle, the company failed to apply that same analysis to its employees’ retirement savings, leaving roughly 23,448 workers’ 401(k) plans exposed to the very dangers it warned its shareholders about.
The lawsuit, Kvek v. Cushman & Wakefield U.S. Inc., alleges the company breached its fiduciary duties under the Employee Retirement Income Security Act, or ERISA, by offering the Westwood Quality SmallCap Fund as an investment option without evaluating its climate-related financial risks.
The fund, according to the complaint, explicitly disclaims climate risk analysis in its methodology. It lagged its benchmarks by 17% in 2025, charged significantly higher fees than comparable options, and was heavily invested in coal-powered utilities and other businesses vulnerable to climate disruption.
“Instead of safeguarding its workers’ futures, the commercial real estate giant is funneling their retirement savings into a high-risk fund,” said Kimberly Blake, an attorney with ClientEarth USA, which is representing the plaintiff along with the law firm Cohen Milstein.
The plaintiff, Renee Kvek, a former Cushman & Wakefield employee, said she trusted the company to offer sound retirement options.
“Like most of my colleagues, my ability to retire depends on the growth and safety of my 401(k) account,” said Kvek. “I was disappointed to learn how exposed my savings were to climate-related financial risks, especially when the company clearly understood those risks in its own operations.”
The case strikes at a central contradiction. Cushman & Wakefield has moved to protect its own balance sheet from climate disruption. It even offers guides to clients on managing the risk. But the lawsuit alleges it failed to shield its workers’ retirement accounts in the same way, leaving their savings exposed to the very climate dangers it has warned its shareholders and clients about.
“When your employer offers you a set of retirement options, you assume they’ve done the work to make sure those options are sound,” Kvek said. “You pick a fund, you contribute every month, and you trust that someone is paying attention to the risks.”
The complaint also alleges the company failed to guard against conflicts of interest involving Fidelity, the financial services firm that both advised and administered the plan.
A $12 Trillion Question
The case is bigger than one employer or one industry.
Americans hold more than $12 trillion in retirement savings accounts such as 401(k)s. Leading financial authorities have warned that climate change poses a material risk to financial stability. Yet those nest eggs could be exposed to companies and industries particularly vulnerable to climate disruption.
Around $863 billion of those retirement funds remain invested in oil, gas, and coal companies. That money flows through 401(k)s, 403(b)s, and pension plans, often into index funds that passively invest in whatever the market holds, including the fossil fuel industry.
Climate risk extends far beyond fossil fuel stocks. It is a broad, interconnected threat that touches large parts of the economy.
Bank shares can suffer when high-carbon loans go bad. Energy utilities face mounting costs from extreme weather. Companies with supply chains running through drought-prone or flood-prone regions can suffer significant losses. Such risks can ultimately reduce the value of investments held in retirement plans.
For many people, this is a passive arrangement they’ve never thought about. But for those whose religious or moral convictions tell them to protect the environment, avoid profiting from harm, or act as stewards of creation, it’s something more serious. It’s a conflict between their beliefs and a material benefit of their employment.
Until recently, there wasn’t much to be done. Employer-sponsored retirement plans offer limited investment options to employees, and many employers don’t include fossil-free funds on the menu. Employees who objected had few avenues to push back.
“We have seen this before,” Blake wrote in a ClientEarth blog post. “In the early 2000s, Wall Street piled into high-risk subprime mortgages, allowing risk to accumulate within investment portfolios, until the global economy buckled and people lost homes, jobs and savings.”
Climate risk, she argued, is the new subprime. It can accumulate and materialize through physical disasters, regulatory developments or market shifts, potentially resulting in sudden and devastating losses.
“This is not some distant threat,” Blake wrote. “The fuse on this ticking time bomb has already burned down in many regions. Right now, hurricanes, wildfires and heat waves are eroding the savings of Americans whose retirement funds are tied to high-risk regions or companies unprepared for the mounting costs of climate disruption.”
A Precedent in the Making
If successful, the lawsuit could set a far-reaching precedent and potentially change how risk is managed across the $12 trillion U.S. retirement market.
A ruling in Kvek’s favor could establish that fiduciaries have a legal obligation to consider financially material climate risks when selecting and monitoring retirement plan investments.
Michelle C. Yau, chair of Cohen Milstein’s ERISA & Employee Benefits practice and counsel for Kvek, called it a “first-of-its-kind legal challenge under ERISA” that “will hopefully show 401(k) plans that the financial risks associated with climate cannot be ignored.”
The court could order Cushman & Wakefield to reimburse the retirement plan for losses found to have resulted from a failure to adequately monitor investment risks. It could also require changes to the company’s process for selecting and monitoring plan investments.
When contacted by reporters, Cushman & Wakefield said: “This claim is a variation on widely asserted legal theories that have been prevalent for many years. We have thoughtful processes in place that are designed to give our plan participants a variety of prudent investment options. Once served, we will appropriately defend this case.”
The case was filed in the U.S. District Court for the Western District of Washington. The retirement plan covers approximately 23,448 employees and had $1.7 billion in assets under management as of Dec. 31, 2024.
Kvek and the proposed class are represented by Jay Rossiter, Kimberly Blake, and Benjamin Segal of ClientEarth USA, along with Michelle C. Yau, Daniel R. Sutter, and Ryan A. Wheeler of Cohen Milstein Sellers & Toll PLLC.
This case is the first of its kind, but it likely won’t be the last. If you believe your retirement savings shouldn’t be funding fossil fuels, and your employer hasn’t given you a choice, get in touch with ClientEarth USA, Inc. at 501 Santa Monica Blvd., Suite 510, Santa Monica, CA 90401, or email: info.us@clientearth.org
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