Friday, December 31, 2021

Comptroller Stringer, NYC Funds Release 2021 Shareowner Initiatives Postseason Report


Funds instigated crucial change in corporate policies with 85% of NYCRS shareowner proposals implemented, including 93% of proposals relating to workforce diversity data

 Today, New York City Comptroller Scott M. Stringer and the New York City Retirement Systems (“NYCRS”) released the 2021 Shareowner Initiatives Postseason Report highlighting a groundbreaking year of progress on climate change and diversity initiatives.

As portfolio companies faced the impact of the COVID pandemic, continued demands for racial justice, and economic upheaval, NYCRS launched initiatives to support employees and foster diverse, healthy and safe workplaces. NYCRS continued to demand corporate progress in achieving global climate goals by strategically engaging portfolio companies on their responsibility to reduce emissions and address the climate crisis.

“Business success in the 21st century requires measurable diversity from the boardroom to the shop floor and immediate action to address climate change,” said Comptroller Stringer. “In 2021, NYCRS took action to ensure that investors have the information necessary to hold companies accountable for their diversity and racial justice commitments, and to accelerate the necessary transition to a low-carbon economy.  These initiatives protect and create long-term shareowner value and provide retirement security to New York City’s active and retired employees.”

It was a year of consequential change, as NYCRS:

  1. Launched a successful national campaign, changing the corporate landscape and dramatically improving the disclosure of workforce diversity data by the largest corporations. Companies are now expected to publicly disclose their EEO-1 Report (which they already submit to the U.S. Equal Employment Opportunity Commission), which includes quantitative, reliable and comparable workforce diversity data concerning gender, race and ethnicity. As a result of the campaign, at least 84 current S&P 100 companies now disclose or have committed to disclose their report, up from approximately 14 S&P 100 companies prior to the launch of the July 2020 campaign.
  2. Negotiated agreements with 14 companies after submitting shareowner proposals to enhance board and executive diversity. Thirteen boards adopted policies to promote gender and racial/ethnic diversity in searches for corporate board directors, CEOs and other C-suite executives. An additional board enhanced its existing policy governing searches for highly compensated executives.
  3. Prompted leading U.S. automakers to set significant greenhouse gas reduction goals and report on the alignment of their climate-related lobbying activities with Paris Climate Agreement goal.
  4. Secured commitments from Southern Company, one of the nation’s largest electric power producers, to comprehensively review its board leadership structure, including consideration of an independent chair and the independent chair’s role in helping the company successfully meet its emissions reduction goal of net zero emissions by 2050.
  5. Voted on 149,396 individual ballot items at 15,517 shareowner meetings in 78 markets globally.

The Systems’ shareowner proposals drove much of their engagement and advocacy success. During fiscal year 2021, the Comptroller’s Office, on behalf of some or all the Systems, submitted shareowner proposals to 48 portfolio companies and subsequently withdrew 85% of the proposals after the companies agreed to take steps to implement the request. Five shareowner proposals went to a vote during the fiscal year, including two diversity-related proposals that received an incredibly high average of 85% support from investors.

Among other impactful initiatives, NYCRS supported the successful election of three dissident directors to the Exxon Mobil Board of Directors in the highest profile proxy contest of the season. The historic election of qualified candidates with crucial energy industry and environmental expertise to Exxon’s Board demonstrated that shareowners now expect “climate competent” boards.

The Report principally covers proxy voting and shareowner initiative outcomes for the 12 months ending June 30, 2021, consistent with NYCRS’ fiscal year.

The full report is available here.

Comptroller Stringer serves as the investment advisor to, and custodian and a trustee of, the New York City Retirement Systems. The New York City Retirement Systems are composed of the New York City Employees’ Retirement System, Teachers’ Retirement System, New York City Police Pension Fund, New York City Fire Department Pension Fund and the Board of Education Retirement System.

In addition to Comptroller Stringer, the New York City Retirement Systems’ trustees are:

New York City Employees’ Retirement System (NYCERS): Mayor Bill de Blasio’s Representative, John Adler (Chair); New York City Public Advocate Jumaane Williams; Borough Presidents: Gale Brewer (Manhattan), Sharon Lee (Queens), Eric Adams (Brooklyn), James Oddo (Staten Island), and Ruben Diaz, Jr. (Bronx); Henry Garrido, Executive Director, District Council 37, AFSCME; Tony Utano, President Transport Workers Union Local 100; Gregory Floyd, President, International Brotherhood of Teamsters, Local 237.

Teachers’ Retirement System (TRS): Mayor Bill de Blasio’s Appointee, John Adler; Chancellor’s Representative, Lindsey Oates, New York City Department of Education; Natalie Green Giles; and Debra Penny (Chair), Thomas Brown and David Kazansky, all of the United Federation of Teachers.

New York City Police Pension Fund (PPF): Mayor Bill de Blasio’s Representative, John Adler; Acting New York City Finance Commissioner Michael Hyman; New York City Police Commissioner Dermot F. Shea (Chair); Chris Monahan, Captains Endowment Association; Louis Turco, Lieutenants Benevolent Association; Edward D. Mullins, Sergeants Benevolent Association; Paul DiGiacomo, Detectives Endowment Association; and, Patrick Lynch, John Puglissi, Joseph Alejandro, and Anthony Cacioppo all of the Patrolmen’s Benevolent Association.

New York City Fire Pension Fund (Fire): Mayor Bill de Blasio’s Representative, John Adler; New York City Fire Commissioner Daniel A. Nigro (Chair); Acting New York City Finance Commissioner Michael Hyman;  Andrew Ansbro, President, Robert Eustace, Vice President, Edward Brown, Treasurer, and Eric Bischoff, Staten Island Representative and Chair, Uniformed Firefighters Association of Greater New York; Liam Guilfoyle, Captains’ Rep.; Paul Mannix, Chiefs’ Rep., and Jack Kielty, Lieutenants’ Rep., Uniformed Fire Officers Association; and, Peter Devita, Marine Engineers Association.

Board of Education Retirement System (BERS): Schools Chancellor Richard Carranza; Mayoral: Isaac Carmignami, Natalie Green Giles, Vanessa Leung, Gary Linnen, Lori Podvesker, Shannon Waite, Michael Kraft (Manhattan BP), Debrorah Dillingham (Queens BP), April Chapman (Brooklyn BP), Geneal Chacon (Bronx BP) and Peter Calandrella (Staten Island BP); Thomas C. Sheppard, Kathy Park Price, Natalie Green Giles, Russell Buckley, Chris Attianese, Shaun D. Francois; and employee members John Maderich of the IUOE Local 891 and Donald Nesbit of District Council 37, Local 372.

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