FOR IMMEDIATE RELEASE
July 1, 2019
IPFI Urges Pittsburgh Pension Board to Stay Strong Against Politicization of Fund
As the Pittsburgh Comprehensive Municipal Pension Trust Fund faces calls to divest from gun manufacturers and other companies, board members should continue prioritizing the secure retirement of its retirees.
Arlington, VA – On the heels of Pittsburgh Mayor Bill Peduto submitting a plan to divest the Comprehensive Municipal Public Trust Fund (CMPTF) from gun and ammunition, fossil fuel, and private prison companies, Chairman of the Board Ralph Sicuro has reaffirmed the fund’s commitment to fiduciary responsibility. IPFI applauds and supports Chairman Sicuro’s courage in the face of those seeking to put politics before fiduciary responsibility.
Mayor Peduto outlined his intentions in a recent letter to the seven member board of the CMPTF, which holds $463 million to fund the retirement of the city’s teachers, firefighters, and employees. Some members of the board have already expressed deep concern over the mayor’s proposal. City Spokesman Tim McNulty stated that it is unclear how divestment would impact the fund’s performance. As a result, the board has convened an exploratory committee to determine the potential harm of divesting. Echoing this decision, Chairman Sicuro affirmed that the foremost goal of the fund was not activism, but instead, is adhering to fiduciary responsibility to grow the fund.
IPFI is committed to advocating for a secure future for all public pension funds, and commends the board’s efforts to maintain fiduciary responsibility. Mayor Peduto must recognize that the board exists as the steward for thousands of employees’ retirement and pensions. The city of Pittsburgh faces a net pension liability of $918.4 million. The board must consider the costs of divesting from value-adding assets, and understand the negative impact that this move would have on the pension fund performance.
What Mayor Peduto is pushing for is not classic environmental, social, and governance (ESG) investing; it is political investing plain and simple. ESG investing focuses on best practices and stewardship in all corporations, not just in those that are a political fad today. In doing so he is squarely putting politics, and his political career, ahead of the secure retirement of all current and retired public employees in Pittsburgh. Fiduciary responsibility always trumps politics.
IPFI President Christopher Burnham recently said, “Prioritizing a political agenda instead of fund performance is a breach of fiduciary responsibility and violates the special trust and confidence which hard-working pensioners have placed in their mayor.” He continued, “The board should strongly reject this plan, and continue prioritizing the primary objective of growing the fund for a secure retirement for all. Pittsburgh public servants and Pittsburgh taxpayers should insist that politics and political advancement should never come before fiduciary duty.”
The Institute for Pension Fund Integrity seeks to ensure that local, state and federal leaders are held responsible for their choices in investment, led not by political ideation and opinion but instead by fiduciary responsibility. IPFI is a non-partisan, non-profit organization based out of Arlington, Virginia, and spearheaded by former Connecticut State Treasurer and former Undersecretary General of the United Nations, Christopher B. Burnham.