STATE PENSION DIVESTMENT BILL SIGNED
By Nancy Vogel, Times Staff Writer
Los Angeles Times, CA –
Sept 26 2006
The law requires the teachers and public employees retirement systems
to withdraw funds from firms aiding Sudan’s government.
SACRAMENTO – California’s giant public pension systems must rid
themselves of investments in companies that help the Sudanese
government, under a measure that Gov. Arnold Schwarzenegger signed
into law Monday.
University of California students and others who led a campaign for
divestment said they hoped that it would persuade other states to
do the same. Ultimately, they want to pressure the Arab-dominated
government of Sudan, which is blamed for the deaths of at least
200,000 non-Arabs since 2003 and the displacement of more than 2.5
million people in the nation’s western Darfur region.
ADVERTISEMENT "Divestment will show our defiance against the murderers
and their inhumanity," Schwarzenegger said at a bill-signing ceremony
at the Hilton Burbank Airport and Convention Center, recalling that
a similar divestment movement two decades ago helped end apartheid
in South Africa.
Joining him at the ceremony were actors Don Cheadle and George Clooney,
and UC student activist Adam Sterling. "State by state, pension fund
by pension fund, your genocide will not occur on our watch and it
will not occur on our dime," Sterling vowed.
When the law takes effect in January, it will require the California
Public Employees’ Retirement System and the California Teachers’
Retirement System to liquidate their holdings in certain companies
that operate in Sudan if, after 90 days’ warning, the companies fail
to halt business activities there.
About two dozen oil, energy and telecommunications firms – most of them
Chinese, Russian, Malaysian, Indian or French – are the targets of the
divestment, said Jason Miller, a UC San Francisco medical student who,
with Sterling, helped create the Sudan Divestment Task Force.
The bill, AB 2941 by Assemblyman Paul Koretz (D-West Hollywood), is
narrowly tailored to force divestment of only those companies that
provide revenue or weapons to the Sudanese government and refuse to
change their practices.
No American companies are on the list for potential divestment, Miller
said, and American companies must get U.S. permission to do business
in Sudan because the nation is considered a state sponsor of terrorism.
Miller conceded that divestment of the two state pension systems
won’t be enough to change the stock price of any potential divestment
targets.
But he and others see the Koretz bill as model legislation that
may spur enough divestment nationwide to pressure the companies and
thus Sudan.
Said Clooney: "As more states begin to adopt it, and they just might,
then perhaps we can take a giant step in making sure that a government
that systematically eliminates its citizens at the very least doesn’t
profit from it."
Four other states – Illinois, Maine, Oregon and New Jersey – also
have ordered pension funds to divest from companies operating in
Sudan. Legislation that is modeled on the Koretz bill is pending in
15 other states, Miller said.
"It’s a more sophisticated route than a couple of other states have
tried," Koretz said. "If it’s too broad of a brush, you wind up
picking up companies that are there and doing good."
The legislation, which passed with the opposition of 13 Republicans in
the Assembly and seven Republicans in the Senate, hastens a movement
already underway at the teachers and public employees pension systems
and the University of California.
In March, pressured by student activists, UC regents voted to liquidate
holdings, worth tens of millions of dollars, in nine foreign companies
that do business with Sudan. The governor signed another, related bill,
AB 2179 by Assemblyman Tim Leslie (R-Tahoe City), that indemnifies
UC regents, employees and investment managers from litigation that
may arise out of the Sudanese divestment.
The teachers pension system on Monday reported holding $12 million
worth of stock in 10 companies operating in Sudan, including Sinopec
Corp., PetroChina Co., Bharat Heavy Electrical of India and Sudan
Telecom Co. Those companies are targeted for divestment under a policy
the teachers pension board adopted in April.
"They have gone through quite an extensive back-and-forth with
a number of these companies," teachers pension system spokeswoman
Brenna Neuharth said. "The bill just speeds the process along."
Public employees pension system spokesman Brad Pacheco said the fund,
with $207 billion in assets, has invested in 39 companies doing
business in Sudan, none of them the nine companies from which UC has
divested. He said he could not estimate how much the system may need
to divest under the legislation because system officials are still
trying to determine the nature of the firms’ Sudanese operations.
Last December, the public employees pension system warned three
European companies that it would sell its hundreds of millions of
dollars worth of shares if they did not sever ties with the Sudanese
government. "We’re still working with those companies" to achieve
change, Pacheco said.
Phil Angelides, the Democratic candidate for governor, who as state
treasurer sits on the public employees pension system board, has
pushed for several years for divestment in firms complicit in what
the U.S. Congress has declared genocide.
He praised the signing of the Koretz bill, saying, "Californians have
a moral responsibility to help end the genocide in Sudan."
On Monday, Schwarzenegger also signed a bill that would allow any
Californian who was a victim of the Armenian genocide or an heir
or beneficiary of a victim to sue financial institutions to recover
assets stolen or lost between 1890 and 1923. Under SB 1524 by Sen.
Jackie Speier (D-Hillsborough), Californians of Armenian descent
would have through 2016 to file claims.
Schwarzenegger signed another bill that would require insurance
companies to disclose how much money they are investing in low- and
middle-income communities. Some insurers had opposed the bill, as had
the governor’s insurance advisor, Kathleen Webb, a former State Farm
official. In May, Webb sent a letter to the author, Assemblyman Mark
Ridley-Thomas (D-Los Angeles), stating her office’s opposition.
"The question is, what is there to hide?" Ridley-Thomas said.
"Disclose what you’re doing: the good, the bad and the ugly."
From: Emil Lazarian | Ararat NewsPress
