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The Consulate General of Israel serves the Pacific Northwest Region of the United States: Northern California, Oregon, Washington, Idaho, Montana and Alaska.
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Tuesday, 17 May 2011 13:49
The country's largest public pension fund is selling all its stock in companies that continue to operate in Iran and Sudan.
The California Public Employees' Retirement System announced that it is fully complying with state divestment laws passed in 2006 and 2007.
In particular, the pension funds were told to steer clear of investments in Iran's defense and energy sectors and any companies found to be complicit in the crisis in Sudan's Darfur region.
Iran and Sudan are subject to U.S. economic sanctions. Iran has been identified as a state sponsor of terrorism, and Sudan has been cited for genocidal acts against the inhabitants of Darfur.
CalPERS said it would sell approximately $160 million in stock in eight companies operating in the energy and other sensitive economic sectors of the two nations. At one point in the last decade, the retirement fund owned more than $2 billion worth of shares in 47 companies that did business in Iran and Sudan. Those shares have been gradually removed from the fund's portfolio.
CalPERS declined to name the eight companies, saying it did not want to reduce the stocks' value before selling.
"The cost of continuing to hold the stock of these eight companies is greater than the value of divesting them," CalPERS board President Rob Feckner said. "Consistent with our fiduciary duty as trustees, we're taking this step in the best interest of the fund."
The legislation passed in 2006 and 2007 didn't order immediate divestment. The laws gave the pension funds wiggle room to avoid dumping stocks in violation of their fiduciary duty.
The two funds have occasionally been accused by elected officials and activists of dragging their feet on divestment.
The funds have defended themselves, saying they were using their muscle as big shareholders to persuade companies to withdraw from the targeted countries. They said that was a more effective strategy than simply selling the stocks.
With so few companies still doing business in the two countries, CalPERS decided it was time to sell.
George Diehr, chairman of the CalPERS investment committee, said the stocks will be sold gradually.
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