The California Senate on Aug. 25 approved a resolution urging CalPERS and CalSTRS, two of the nation's largest pension funds, to encourage portfolio companies not to invest in Sudan. The resolution, sponsored by Assemblyman Mervyn Dymally and already approved by the State Assembly, does not call for divestment by the two plans.
State Treasurer Phil Angelides had asked the $197.5 billion California Public Employees' Retirement System and the $129 billion California State Teachers' Retirement System, both in Sacramento, to consider divestment of any company that does not cease activities in Sudan and to report on portfolio companies with business operations in the country. Mr. Angelides said he wanted these reports by the Sept. 7 meeting of the CalSTRS board and the Sept. 19 meeting of the CalPERS board.
Both the CalPERS and CalSTRS boards already have voted to support Mr. Dymally's resolution. "It is consistent with our current governance policy," said Sherry Reser, CalSTRS spokeswoman. She also said the staff is working on the Sudan report requested by Mr. Angelides and it should available before the Sept. 7 meeting. CalPERS spokeswoman Pat Macht did not return a call by press time.
That same day, New York City Comptroller William Thompson Jr. asked the five funds in the $91.3 billion New York City Retirement Systems to review their portfolio companies for business ties to Sudan. Mr. Thompson sent letters this week to China Petroleum & Chemical Corp., Alcatel, BAE Systems PLC, Finmeccanica SpA and Royal Dutch Petroleum Co., asking each to examine potential financial risks and report findings to shareholders. The city's pension systems have more than 8.6 million shares worth more than $209.9 million in the five companies, according to a news release.
Business dealings with Sudan "could expose the company to negative publicity, public protests and a loss of investor confidence, all of which could have a negative effect on shareholder value," Mr. Thompson said in a news release.