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IPFI Issue Brief: Behind BlackRock’s ESG Shift

BlackRock, the world’s largest private asset manager, has over the past two years begun to shift its investment strategy, placing a much greater emphasis on environmental, social, and governance (ESG) factors and boosting the presence of ESG funds in its portfolios. In a newly released issue brief, the Institute for Pension Fund Integrity delves into […]

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Pension Gap Calculator

Select your state of locality below and adjust the assumed rate of return and predicted mortality rate to see the effect of these changes upon their pension gap. Read about the Pension Gap Calculator Tool here.

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Blog

New Kentucky Lawsuit Takes Aim at Risk in Public Pension Investments

August 4, 2020

The state of Kentucky revived and expanded a lawsuit that claims former officials of the state pension system and hedge fund firms violated their fiduciary duty by choosing risky investments. The state is demanding compensation from hedge funds for their excessive fees and underperformance.  Kentucky’s pension system remains one of the worst-funded in the nation, […]

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How do you define ESG investment? It depends on who you ask

July 28, 2020

The term “ESG” – Environmental, Social, and Governance-based investing – was first used in an International Finance Corporation 2005 report Who Cares Who Wins and developed a widespread use in the following years. Currently, there is over $20 trillion in ESG assets under management and is a growing sector.  One of the key issues with […]

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Core Principles

Adherence to Fiduciary Responsibility

The Institute believes that officials residing over pension funds should be held to a high degree of fiduciary responsibility, consistently making decisions on investment that will benefit the long-term growth and security of the fund. Consistent dividend yield, resistance to market flux and strong corporate credit ratings are just a few variables that must be taken into account by these individuals. Often times outside interests have pressured pension funds and other entities to divest from certain investments under political pressures, which would subject pension funds to lower financial returns. This divestment would violate a pension fund’s fiduciary responsibility.

Balanced Economic, Social, and Governance (ESG) Factor Investment

Accounting for ESG factors in investments can prove to be advantageous with greater transparency and consistently high returns. With more than 80% of all corporations releasing ESG factor reports, options are plentiful for the investment of pension funds into holdings with positive ESG outlook. ESG factors should not dictate a political agenda for guiding public investment decisions.

Long term Pension-Fund Return

When investing with pension funds and other long-term payout entities it is imperative that long-term stock stability be sought after in the investment process. Part of the responsibility of the managers of pension funds is to identify long-term, low market volatility investments that will allow for prolonged growth and a sustaining of pension budget health for years on end.

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