NYCERS in hunt for responsible asset managers

The $45bn (€33bn) New York City Employees Retirement Scheme (NYCERS), which manages the pensions of more than 300,000 of the city’s municipal workers is searching for asset managers to run two responsible investment mandates.
The fund will hire one manager to run a sustainable and environmental active management strategy in a portfolio of global companies. The second manager will be hired for an activist equity mandate agitating for change within investee companies. Michael Musuraca, designated trustee at the fund for the American Federation of State, County, and Municipal Employees (AFSCME), AFL–CIO, District Council 37, the largest public sector union in New York City, said the values of the mandates had yet to be decided: “We’ve left open how much we are going to target until after we have reviewed the submissions.”
Musuraca said the fund’s policy is clear: “We call what we do responsible investment. It is responsible in two ways. Firstly, we put environmental, social and governance issues into our investment decisions. Secondly, we takeresponsibility for what we do as a fund.”
Musuraca said the fund was also examining its policy on emerging markets investment, where it has three per cent of total equity exposure, to see whether it should mirror a shift by CalPERS, which recently introduced qualitative criteria to underpin its investments. He said: “Our policy is roughly the same type that CalPERS used to employ, i.e. a permissible list of countries to invest in, but with a previso to managers that says if you find a company in a prohibited country that meets our responsible criteria, then justify it and go ahead and invest in it. We use a combination of traditional financial issues such as liquidity alongside political issues such as a free and independent judiciary, free press, right to association, collective bargaining, and conditions of employment. We’ve done very well in our emerging markets investments as a result. The debate that CalPERS has instigated means that we may need to revisit what we do.”
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