The nation's largest public pension fund says it's taking steps to ensure long-term solvency for its 1.6 million members.

California state employees rely on CalPERS for their retirement and health benefits.

The agency just released a report called "A Solid Foundation for the Future."

Marcie Frost runs the fund and says the organization has to be very focused on return and risk.

This, as the agency faces social pressures to divest from companies, including those connected to fossil fuels and guns.

"It calls for a number of different conversations to have, and one of those difficult conversations is really around this divestment issue. It's very emotional," Frost said. "We're highly empathetic, but we also have to make sure that we are setting the right future for this fund."

Frost says the current funding status is at 71 percent, up from a low of 61 percent during the recession.

She says the goal is to get above 80, which would elevate the fund out of the red zone. 

"We are a long-horizon investor. We've been in business for 85 years. We're going to continue to be in business. We are not insolvent," she said. "But there is a path and there are very difficult decisions that have to be made and those difficult decisions will cost local government, state government, additional money to be able to continue to shore up this system."

Frost also says that the fund's primary duty is to pay benefits, but that using divestment as a tool for social change is never completely off the table.