SEATTLE – Councilmember Tim Burgess (Position 8, Citywide) and Chair of the Seattle City Employees’ Retirement System Board, and Jeff Davis, Executive Director of the SCERS Board, issued the following statement at the conclusion of today’s Board meeting, during which time fossil fuel divestment was discussed:
“Today’s Board meeting was well attended by community members who made moral and financial arguments as to why SCERS should divest of its fossil fuel investments.
“The SCERS Investment Advisory Committee, composed of investment experts who advise the Board, reviewed the prior recommendations from SCERS’ investment consultant and staff on fossil fuel divestment that had been requested by the Board in April. They reaffirmed the prior recommendations that fossil fuel divestment would negatively impact SCERS’ investment portfolio and should not be pursued. The Investment Advisory Committee concluded that further analysis of the issue was not required and further recommended that the Board consider revising its policies for consideration of future divestment requests.
“Jason Malinowski, Chief Investment Officer of SCERS, reported on the positive action strategy that the Board adopted in February 2015 related to climate change, that includes engaging as shareholders with corporations and other entities, considering sustainability investments and integrating climate change risk into the investment process. Mr. Malinowski clarified that SCERS had not lost $100 million from its investments in fossil fuel companies, as had been suggested by community members, but instead had generated a positive return that lagged the broad stock market.
“Michael Monaco, attorney at Mondress Monaco Parr Lockwood PLLC and outside counsel for SCERS, provided an analysis of the Board’s paramount fiduciary duties and described the strict limitations the Board faces to taking action that compromises economic outcomes in the pursuit of environmental, social or governance goals. The Board voted to waive the attorney-client privilege so the Monaco analysis could be released publicly.”
After discussion, the SCERS Board took no action on fossil fuel divestment.