Priya Mathur, the president of the board of the California Public Employees’ Retirement System (CalPERS), has been voted off the fund’s board in favour of a candidate who ran on an anti-ESG platform.
Mathur, who is also a board director of the Principles for Responsible Investment (PRI), has been a director of the fund, representing public workers, for 15 years and president since January this year.
She has been voted off the board by workers, with police officer Jason Perez being declared the winner of a public agency election.
CalPERS said Perez received 9,208 votes (56.8% of the votes cast) while Mathur received 7,008 votes (43.2%).
The vote comes amid scrutiny over the educational record of the fund’s CEO Marcie Frost. Mathur has been an “unwavering” supporter of Frost amid reporting by the Naked Capitalism blog.
Perez is a sergeant for the Corona Police Department and president of his police officer association. He has been a member of the $362bn fund for more than 27 years and this will be his first term.
He ran on a platform critical of Mathur’s focus on ESG.
In a campaign video, he said: “Mathur has failed CalPERS and put our retirement security at risk due in part to environmental, social and governance investing priorities regardless of the investment risk.”
He went on to note that Mathur, whose day job is with the Bay Area Rapid Transit system, has been fined multiple times for failing to disclose conflicts of interest and campaign contributors.
In 2014, RI reported that she had been fined thousands of dollars for ethics violations relating to her role at CalPERS by California’s political ethics watchdog, the Fair Political Practices Commission (FPPC).Mathur explained the reasons for focus on responsible investment in her PRI candidate statement back in 2014.
“To achieve a stable portfolio and funding status, we cannot afford to ignore important risks facing our portfolio over the long term. This is why I have been so vocal about integrating a robust assessment of climate change, labor rights and other ESG factors into our investment decision-making.”
“Mathur is out of touch, believing her role is to fly around the world hobnobbing with UN officials.”
At the PRI – where her term is due to end in 2020 – she championed the development of CalPERS’ Investment Beliefs and chaired the PRI’s Governance Committee during its governance review. She was voted onto the board by other asset owners and according to the PRI’s Articles of Association, a director may be a ‘relevant officer’ or a ‘former relevant officer’ of a signatory. A PRI spokesperson wasn’t immediately able to comment.
Perez said: “Mathur is out of touch, believing her role is to fly around the world, ringing the bell of the London Stock Exchange and hobnobbing with United Nations officials.”
The election means that CalPERS will have to pick a new president next year.
Perez’s four-point plan includes renegotiating “sweetheart deals” with Wall Street firms and putting a stop to board members “living the lifestyle of the rich and famous”.
“They don’t need to be traveling all over the world at the expense of CalPERS and taxpayers.”