Tag Archives | pensions

Fiduciary Duty to Announce Votes (Part 3): Take Action


Take Action: Ask your mutual fund, pension fund, and/or endowment to:

  1. Send you a copy of their proxy voting policies and their proxy voting record.
  2. Report their votes in advance of annual shareholder meetings to ProxyDemocracy.org.  
  3. Make a small donation (not tax deductible) to ProxyDemocracy.org to keep that valuable service going or contact Andy Eggers to make a tax-deductible contribution through their 501(3) affiliate. I’ll match donations up to $2,000 until the end of June.

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Vote Disclosure at CalPERS: Example For Other Pension and Mutual Funds

CalPERS-logoLast week I followed up on a proposal made in early 2010 as a result of a couple of resolutions I was able to get enacted through my union in 2009. Yes, these issues take time. You must be tenacious, even when dealing with a fund like CalPERS, where both board and staff want to do the right thing, since there are so many competing needs. I reproduce my testimony below in hopes that others will follow my lead at their pension and mutual funds. Continue Reading →

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Another Twinkie Defense

Hostess In the process of complete liquidation, Hostess essentially admits it robbed the pensions of 18,000 unionized workers and put it toward executive pay for winding down the company. According to AlterNet,

Just last month, a judge agreed to let Hostess executives suck another $1.8 million out of the bankrupt company to pay bonuses to CEOs.

Read the expose, Twinkie CEO Admits Company Took Employees Pensions and Put It Toward Executive Pay.

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LA Trustees Roundup 2012: Corporate Governance

As Laura Berry mentioned at the conference, this is an event to recharge your batteries. It is great to learn what others are doing. Of course, the list of things I need to do grows exponentially every time I attend one of these gatherings of mostly California public pension funds. Disclaimer, disclaimer, disclaimer: Nothing I report is a quote. Opinions expressed don’t represent the views of respective organizations and may not even represent the views of those attending the event. Provocation may be intended Continue Reading →

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Retirement Security for All

Hank Kim, Executive Director and Counsel for the National Conference on Public Employee Retirement Systems (NCPERS), has unveiled a proposal for a new type of retirement plan. To those who think CalPERS and other pensions for public employees should be abandoned, the proposal offers an alternative. See Retirement Security for All.

The proposed Secure Choice Pension (SCP) is aimed at enhancing retirement security in the private sector by providing workers who are not in a pension plan with a Continue Reading →

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Retirement Security for All

Hank Kim, Executive Director and Counsel for the National Conference on Public Employee Retirement Systems (NCPERS), has unveiled a proposal for a new type of retirement plan. To those who think CalPERS and pensions for public employees should be abandoned, the proposal offers an alternative. See Retirement Security for All.

The proposed Secure Choice Pension (SCP) is aimed at enhancing retirement security in the private sector by providing workers who are not in a pension plan with a guaranteed, lifetime retirement income that would be immune to stock market fluctuations and economic downturns. The plan would provide the flexibility and portability that a mobile private work force needs, while spreading investment risks and costs over large pools of plan participants and employers, according to a press release.

“Less than half of private sector employees have access to an employer-sponsored retirement plan — and many of those who do simply are not financially prepared for retirement,” said Hank Kim, Esq., Executive Director and Counsel for the National Conference on Public Employee Retirement Systems (NCPERS). “Recent studies have put the gap between what private sector workers are saving and what Continue Reading →

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Wayback Machine: Ten Years Ago at CorpGov.net

Ten years ago this month I posted a review of Monks, Robert A. G., The New Global Investors: How Shareowners Can Unlock Sustainable Prosperity Worldwide, Capstone Publishing, 2001. “His perspective is that of an aristocratic shareholder activist, not a street demonstrator against the World Trade Organization… Monks appears to believe, and I agree, that corporate control has been largely hijacked by CEOs for their own selfish interests.”

This seemed to be something of a turning point book for Monks. In previous books, he rejected the need for new laws. “No new laws need be passed, no new regulations promulgated, no new agencies formed,” as he says again in this volume on page 184. However, by the next page he concludes that “amendments or possibly new regulations may prove necessary.” Good, but then he went on to write that the Continue Reading →

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Ontario to Require ESG Disclosures of Pensions

The Canadian province of Ontario is scheduled to become the first in the country to oblige its pension plans to publish a Statement of Investment Policies and Procedures (SIPP) and publicly state whether the SIPP takes ESG (environmental, social and governance) issues into account. The SIPP introduction could act as a major boost to the take up of responsible investing in Canada…

via Responsible Investor, 3/30/2011. I hope this requirement spreads to the U.S. as well.

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Organizing for Retirement Security

Disclaimer: These are my notes from the second day of a conference of mostly California pension funds. I try, but don’t guarantee accuracy. These notes are very abbreviated and do not cover several speakers.

The LA Trustees Roundup keeps getting better every year. If you’re a trustee or even just a member of a public pension fund, you should plan on attending next year. Coverage of day one: AM sessions, PM sessions.

Pension Plan Attacks: State and National Efforts to Eliminate Quality Retirements in the Public and Private Sector

Hank Kim, National Conference of Public Employee Retirement Systems

We used to suffer from benign neglect. Public sector employees and unions were an after-thought when it came to legislation. Now we are squarely in the focus of Congress.

  • Public Employees Pension Transparency Act – Requires reporting requirements. Hammer would take away tax exempt bonds. Report two funding numbers, one real and one based on US Treasury obligation yield curve as the discount rate (for shock purposes). Hoping to defeat in Senate.
  • House resolution by Jeff Chaffetz – nonbinding. Overly generous, be it resolved that the Federal gov should not bail out. States and locals should replace DB plans with DC plans.
  • Gingrich. Allowing states to declare bankruptcy to allow them to walk away.

There was no budget deficit in Wisconsin before tax breaks for corporations. Unions have agreed to cutbacks. Need to parse it out for media and public. Beginning in May last year Continue Reading →

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Securing Fund Assets: AM Sessions

Disclaimer: These are my notes from the conference of mostly California pension funds. I’m not a very quick note taker, so I have a tendency to fill in the “gaps” with relevant material from the Internet and with my own interpretation of what where I think the speaker was going. These notes are basically a small part of a more than 15 year diary mostly written for my own future reference. Of course, I try to be accurate but this is a blog. I don’t have the fact checkers and other resources of publications like the New

Carolyn Widener

York Times. On the other hand, I’d like to think that I sometimes bring additional insights to bear on the subject… sometimes more than the average reporter… although that may be delusional on my part.

The subject of the 1st day of the LA Pension Fund Trustees Roundup 2011 conference was, Pension Fund Strategies for Securing Fund Assets. After introduction and welcoming remarks from Carolyn Widener of the LA Trustees Network, we heard from Mike Musaraca of Blue Wolf Capital.

Why We Need to Organize to Secure Fund Assets: Mike Musaraca

Musaraca reminded us of the shocking income gap between rich and poor in America, with the hollowing out of the middle class. Retirement trustees are often at the center of the debate trying to ensure retirement security and a decent standard of living for beneficiaries. A crucial component is how well trustees grow and protect our funds.

Mike Musaraca

As a result of lack of regulation and failure to enforce what regulations we did have under Bush and Greenspan, as well as preverse compensation incentives, we are now drowning in a sea of toxic assets. But 2008 was not the first crisis in recent times but was part of a pattern. Huge pools of capital have an enormous impact on capital markets and the economy. We need to ensure against future market failures.

The current drive to eliminate collective bargaining… Continue Reading →

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Pensions for All

A recent brief from the National Institute on Retirement Security, Who Killed the Private Sector DB Plan?, finds the following are the main factors that contributed to the decline in private pension funds:

  • Increased regulation, which has had the unintended consequence of impacting both the cash flow of the firm and volatility of plan funding;
  • Private-sector industry changes, which resulted in fewer unionized jobs, and fewer new industries establishing DB pension plans; and
  • Imperfect knowledge of employee preferences for traditional DB plans.

Despite these problems, traditional pension plans are good for both employees, in ensuring a certain modicum of income security in retirement, and for employers, as they remain a cost-efficient and highly effective recruitment and retention tool. Therefore, several solutions and policy are explored that could reverse the downward trend in pension plans. These include:

  • Creating an avenue for third-party sponsorship of the DB plan,
  • Amending regulations so that funding is less volatile,
  • Finding ways to make it easier for employees to contribute to plan funding, and
  • Designing plans so that they are more portable as workers change jobs.

I think a multiple employer set up on a geographic basis might be promising:

The New Benefits Platform for Lifetime Security would allow employers to choose between competing Benefit Administrators in order to offer retirement and other fringe benefits. These Benefit Administrators would assume the traditional role of plan sponsors, and would be organized on a geographic basis, with regional exchanges possible. The system would be open to both large and small employers in the public and private sectors, and would be governed by rules set by the Federal government.

Instead of focusing on how to take pensions away from public employees, we should be exploring ways to increase retirement security for all workers. Who Killed the Private Sector DB Plan? is a good start. From a corporate governance perspective, it is critical that a larger proportion of funds in the market are held for the long-term so that shareholders begin to think and act more like shareowners. Pension plans are much more likely to take a long-term perspective than are the funds typically available through 401(k) plans, which are often focused quarter-to-quarter in order to generate fees from more deposits.

See also, How to think about the public pension mess, Salon.com, 3/3/2011.

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