Arkansas Teachers puts 6 Firms on "ESG Blacklist"
White said the board will meet again May 6 to review any responses it receives before making a final decision on which companies will go on the final list.
According to Pensions and Investments Onlines, an ESG Oversight Committee set up by Arkansas state statute last year to identify financial services companies that discriminate against companies due to ESG considerations came out with an initial list of six firms at the April 15 meeting of the $21.8 billion Arkansas Teacher Retirement System, Little Rock.
The oversight committee, mandated by the state Legislature's Act 411 of 2023 “concerning the regulation of ESG scores,” cited the following groups and their money management arms as facing possible divestment: Credit Suisse, Goldman Sachs, Nomura, Royal Bank of Canada, TD Bank Group and UBS Group.
Mark White, ATRS executive director, told the pension fund’s investment committee that he had notified the six firms, starting a 30-day period when they could make their case about why they should not be added to the list.
A UBS spokesperson said in an email, “UBS will provide the Arkansas ESG Oversight Committee with extensive information on our policies and practices that demonstrate we do not discriminate against energy companies.”
Spokespeople for the other firms didn’t immediately respond to requests for comment.
White said the board will meet again May 6 to review any responses it receives before making a final decision on which companies will go on the final list.
White said Arkansas Teachers has investments with three of those six companies, including some collateralized mortgage obligations with Credit Suisse and bonds from Goldman Sachs and UBS. Those publicly traded investments amount to $5.6 million “at the moment” and could be sold without loss.
However, three private market UBS funds with combined assets of roughly $240 million — UBS Agrivest Core Farmland Fund, UBS Trumbull Property Fund and UBS Trumbull Property Income Fund — would be more complicated to unload, with options such as selling them into the secondaries market likely to entail losses, White said.
For now, White said his team will wait to see what the outcome of the appeals process now underway. Meanwhile, he noted, there’s an exemption under Act 411 that allows Arkansas Teachers to refrain from selling an investment if doing so would entail a loss.
If you have an ESG-related news tip, press release, fabulous feature, podcast guest suggestion or other content concepts, please email thecontentcreationstudios(AT)gmail(DOT)com
All Energy Has A Purpose and We Are All Energy. Support those who are living the crude life today!
#thecrudelife promotes a culture of inclusion and respect through interviews, content creation, live events and partnerships that educate, enrich, and empower people to create a positive social environment for all, regardless of age, race, religion, sexual orientation, or physical or intellectual ability.