US - (CalSTRS) has admitted its SRI policy requires an "extreme makeover" and needs to move to a "newer global UN standard".
A spokesperson from the US$156bn California State Teachers’ Retirement System (CalSTRS) would not be drawn on policy specifics, however, Global Pensions understands that after being told by fiduciary counsel, Ian Lanoff, its SRI policy was “musty”, the investment committee has proposed changes.
These should be implemented by February 2007.
Dubbed "Extreme Make-over – Policy Edition", the review will see the fund’s policy being brought in line with the UN Princi-
ples for Responsible Investment (UN PRI), although CalSTRS is not one of the charter signatories – yet.
The possibility of signing up to the charter was, however, proposed by the committee. “By becoming a signatory, CalSTRS is making a public statement in favour of global human rights and environmental standards,” the fund said.
In spite of this, no time frame was given as to when the UN charter was likely to be signed.
“This is a very significant change because, prior to the UN PRI, CalSTRS was one of the only pension plans on the globe… that had any kind of investment principles like our statement,” the investment committee claimed.
“If CalSTRS continues with a different set of standards and principles, we risk confusion,” the committee said.
Commenting on the likelihood of CalSTRS signing the UN PRI charter, a source revealed the addition of the fund would be welcomed – considering the momentum the charter was gaining globally.
However, the fund’s apparent caution was seen as unsurprising.
Since the UN PRI would run across a fund’s whole portfolio, it signified a firm commitment. “The issue of state public pensions has become very politicised and therefore bigger funds would need to be wary going forward,” the source said.
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