CalPERS announced on Monday, April 2nd that Anne Simpson, who heads their corporate governance efforts, has been elected to the Board of the Council of Institutional Investors (CII).
CII is a nonprofit, nonpartisan association of pension funds and other employee benefit funds, foundations and endowments working on behalf of its members for good corporate governance and strong shareowner rights. Simpson was elected to the 15-member Board at CII’s annual meeting in Washington, D.C. Anne Stausboll, CalPERS CEO was quoted in the fund’s press release as follows:
Anne is a passionate believer in shareowner rights and the role that good corporate governance practices play in sustaining and strengthening the companies we invest in. She’ll be a strong voice on behalf of all investors for the financial reforms and sustainable financial markets that are so vital to our continued success.
Simpson joined CalPERS as Director of Corporate Governance in 2009. She previously was the Executive Director of the International Corporate Governance Network and head of the World Bank’s Global Corporate Governance Forum. She is a Visiting Professor and Senior Faculty Fellow at the Yale School of Management, where she teaches corporate governance, and recently was appointed a member of the Investor Advisory Group of the Public Company Accounting Oversight Board.
I became familiar with Simpson in 1999, when I reviewed a book that she and the late Jonathan Charkham had written entitled Fair Shares: The Future of Shareholder Power and Responsibility. I was impressed then and have been even more impressed with her work at ICGN, Yale and CalPERS. One of the many important things she has tried to do at CalPERS is to increase the awareness and involvement of its 1.6 million members in corporate governance practices by sharing the organization’s research and voting decisions with them.
We have also discussed the idea of soliciting feedback from members on the 1994 3rd Restatement of Trust Law, Section 2, which sets out the Standard of Care; Portfolio Strategy; Risk and Return Objectives. Subdivision (c) sets out a list of usual considerations, such as economic conditions, tax consequences, expected total return, needs for liquidity, etc. The most interesting consideration is that in subdivision (c)(8):
an asset’s special relationship or special value, if any, to the purposes of the trust or to one or more of the beneficiaries
Wouldn’t it be interesting to get member feedback on what special relationship or special values should be considered? We have all be frustrated by a massive computer integration project which has delayed implementing some of Simpson vision. However, I know she will take the same sort of creative initiatives to CII and look forward to her increased influence on their activities.
CalPERS, with assets of approximately $237 billion, is the largest public pension fund in the U.S. It administers retirement benefits for more than 1.6 million California State, local government, and public school employees, retirees, and their families on behalf of more than 3,000 public employers, and health benefits for more than 1.3 million enrollees. The average CalPERS pension benefit is $2,332 per month. The average benefit for those who retired in the most recent fiscal year that ended June 30, 2011 is $3,065 per month.
CII is a nonprofit, nonpartisan association of pension funds and other employee benefit funds, foundations and endowments with combined assets that exceed $3 trillion, and a leading voice for good corporate governance and strong shareowner rights.
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