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PERA compromises on Iran divestment plan

By David Milstead, Rocky Mountain News (Contact)

Published January 23, 2008 at 12:05 a.m.

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Colorado's biggest pension plan has developed a divestment policy for Iran that follows closely on the heels of its decision to pull out of the African country of Sudan.

The new policy for the Colorado Public Employees' Retirement Association doesn't go as far as its Sudan policy, created by law in 2007. Prompted by the Darfur genocide, the law called for PERA to sell off stakes in international companies doing business in Sudan.

Republicans began calls for a divestment from Iran, citing allegations the regime was supporting the insurgency in Iraq and was therefore responsible for the deaths of American soldiers. PERA's board adopted a policy that drew the line at genocide.

The Iran plan, passed by the PERA board Friday, is a compromise among the two political parties, the pension fund and the Jewish Community Relations Council. It also cuts off a potential legislative debate that could have added nations to the list.

The Iran plan calls for a moratorium on new investment in companies doing business in the country's energy sector. PERA will examine its existing Iran investments, "engage" the companies in dialogue and evaluate whether there's too much risk to PERA in the investment.

The policy stops short of full divestment. Nonetheless, Gov. Bill Ritter, who announced it Tuesday, said the goal was divestiture, and if PERA reached a different conclusion, the board's resolution "can be changed, amended or modified."

"I believe this allows PERA to maintain its fiduciary relationship to its retirees while simultaneously taking an aggressive stance with companies doing business with Iran."

PERA Executive Director Meredith Williams said PERA had "several hundred million" dollars invested in companies doing business in Iran, a small amount of its $40 billion-plus portfolio.

Finance Editor David Milstead can be reached at milstead@RockyMountainNews.com or 303-954-2648.

Comments

  • January 23, 2008

    10:41 a.m.

    Suggest removal

    Art writes:

    PERA exists to manage pensions for employees who have contributed to the funding during their working years. It does not exist to dictate social policy. The employees who are contributing or who have already contributed should be the ones directing the investments. At the least they should have a major voice in decisions such as where to invest their earnings. Why have they not been contacted and asked about this? Why is this being dictated by the legislature and PERA's board without input from the true stakeholders?