Rhode Island Secures Church Pension Transparency

Rhode Island is poised to require religious organization-run pension programs to disclose their finances to plan participants, in the wake of a scandal surrounding a broke church-related plan where the beneficiaries didn’t know how bad things were.

The plan, for employees of St. Joseph’s and Our Lady of Fatima hospitals, was exempt from standard disclosure rules for pension recipients.

The state’s House of Representatives this week passed the disclosure measure, previously approved by the state Senate and awaiting the governor’s expected signature. It calls for regular updates on the financial health of church and other clerically managed funds.

“Any member of a pension plan, no matter who administers the plan, should have access to information about their pension,” said Rhode Island Treasurer Seth Magaziner. “This must never happen again in Rhode Island.”

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The fund was acquired in 2014 when the California-based Prospect CharterCare bought St. Joseph and the hospitals it owned.

Diocese Lay Employees Retirement Plan members discovered it was insolvent in 2017.

Evan England, Magaziner’s director of communications, told CIO some involved in the sale tried to help the ailing plan, but that their efforts went “into a black box.”

“It ought to have been sustained,” he said.

The transparency bill was passed swiftly in both chambers.

The Rhode Island faith-based fund, which has been in the Pension Guaranty Benefit Corporation’s oversight since last year, will now be subject tothe same guidelines as the Employee Retirement Income Security Act (ERISA), which requires broad transparency to plan participants.

“Essentially this legislation requires that they annually mail their members just basic information about the health status of their plan,” said England.

Religious plans currently claim exception from ERISA and other reporting standards, such as those mandated by the Governmental Accounting Standards Board.

All that’s left is for Governor Gina Raimondo to sign, which is believed to be inevitable by all parties.

Neither Magaziner, the churches, nor the governor could be reached for comment.

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Tags: churches, loophole, Pensions, Rhode Island, Seth Magaziner

A group of institutional investors representing more than $1 trillion in combined assets are calling on the companies they invest in to do more to include people with disabilities in the workforce.

The initiative is being led by New York State Comptroller Thomas DiNapoli and Oregon State Treasurer Tobias Read, and includes California State Teachers’ Retirement System (CalSTRS), Voya Financial, Inc., American Federation of Labor and Congress of Industrial Organizations (AFL-CIO), and the state treasurers of Illinois, Connecticut, Rhode Island, and Vermont, among other institutional investors.

“Disability inclusion provides businesses with a great opportunity to improve their bottom lines, while boosting diversity and innovation,” said DiNapoli in a statement. “We want to know that our investment dollars are being used to maximize a company’s potential and its long-term profitability. Disability inclusion expands the pool of talent companies can hire from and creates welcoming workplaces that foster different perspectives, giving an enterprise a competitive edge.”

In a joint statement, the investors said research has demonstrated that “embracing equality, diversity, and inclusiveness is increasingly critical to the long-term success of corporations in the global marketplace.”

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The statement cited a 2018 report from consulting firm Accenture, non-profit Disability:IN, and the American Association of People with Disabilities (AAPD), that said companies that embrace best practices for employing people with disabilities have outperformed their peers. However, the report concluded that corporate America has failed to capitalize on the abilities of more than 10 million people with disabilities.

Despite a strong labor market in the US, people with disabilities are significantly underemployed compared to the rest of the country, according to the report. It said that as of July 2018, only 29% of working age Americans (between ages 16 and 64) with disabilities participated in the workforce, compared with 75% of Americans without a disability. And in 2017, the unemployment rate for people with disabilities was more than twice that for those without a disability—9.2% compared with 4.2%.

“Companies that embrace disability inclusion in the workplace benefit from increased innovation as well as profitability,” said Read in a statement. “We are asking the companies we invest in to adopt policies to improve the representation of people with disabilities in their workforce and continue to identify opportunities for improvement.”

In the joint statement, the investors called for companies to adopt policies for:

Setting goals for hiring people with disabilities and tracking progress in meeting those goals
Public support from a senior executive for creating a disability-focused employee resource group that fosters a supportive network
Including people with disabilities in their corporate diversity and inclusion statements

The investors’ also encouraged companies to participate in the Disability Equality Index (DEI), which is an initiative of Disability:IN and AAPD. The index allows companies to self-report and benchmark their disability policies and practices, and identify ways to build reputations as inclusive organizations. DiNapoli wrote to 49 corporations in the portfolio of New York state’s pension fund in January and urged them to register for the DEI, which resulted in several companies participating.

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Tags: AFL-CIOdisabilities, CalSTRS, institutional investors, Oregon State Treasury, Thomas P. DiNapoli, Voya