New York City Comptroller Scott Stringer, fiduciary for the five public pension funds that make up the $163.4 billion New York City Retirement Systems, announced Friday that the pension funds are planning to introduce diversity as a formal criterion for evaluating and selecting external money managers.
The new initiative will be launched sometime later this year, said Eric Sumberg, spokesman for Mr. Stringer. It will consist of a new survey in which potential money managers will be asked to provide the composition of their investment staff and boards, and a new category of money managers will be created, in addition to its existing emerging managers category, to be known as “diversity practitioners.”
“Diversity is not merely a social value, it has strong economic value for our investments,” Mr. Stringer said in a news release. “We want the companies in which we invest to harness the economic and financial benefits of diversity. Now we’re going to ask the people who help us choose where to invest our money to show us that they walk the talk when it comes to diversity.”
The news release added the pension funds currently have $10.9 billion invested with minority- and women-owned business enterprises.
“The New York City pension funds intend to help set a standard and push the envelope for how pension funds and asset managers alike engage on diversity on a holistic level. As our society and economy become dramatically more diverse, so too must our investors and our investments. The opportunities of tomorrow won’t be captured using the business practices of yesterday. Diversity is a fiduciary duty and these funds are poised to prove that,” Mr. Stringer said.