New York State Comptroller Calls Out 4 More Companies on Board Diversity

Gaming and Leisure Properties, New Residential Investment Corp., Sinclair Broadcast Group, and Trip Advisor are the latest batch of companies to feel New York State Comptroller Thomas P. DiNapoli’s wrath over what he sees as a lack of diversity.

DiNapoli, the sole trustee of the state’s $207.4 billion Common Retirement Fund, has filed shareholder proposals against the four businesses, demanding they improve the diversity on their boards.

“Research has shown that companies with diverse boards perform better,” DiNapoli said, adding that they otherwise face a competitive disadvantage. “And when companies fail to address shareholder concerns over lack of diversity, they demonstrate a lack of accountability.”

The four companies he named are part of a growing list, now 33, that the comptroller accuses of board diversity shortfalls.

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As a paradigm, he cited BlackRock’s suggestion of a two-women minimum for boards. The Common Retirement Fund chief said he is “encouraged by signs of progress,” with women filling nearly one-third of new director openings in 2017, but dismayed as women and people of color account for “approximately 20% and 10.6% of S&P 1500 directorships, respectively.”

To DiNapoli, each board of directors should have a diversity progress report for shareholders by September. The New York fund specified inclusion across all areas, adding women and people of color in each candidate pool for new director nominees, and an update on how the companies are recognizing qualified women and people of color for their boards.

Other elements of the fund’s corporate diversity plan include proxy voting policy to oppose all incumbent board members at companies with no women directors. It has voted accordingly at 616 companies to date. In the case of businesses with only one woman on a board, the fund votes against the nominating committee members, which has happened at 450 companies so far.

DiNapoli wrote to more than 200 companies in the Russell 3000 Index that had no women directors in September. The letter warranted an explanation as to how the corporations would respond to investors inquiring the lack of diversity. Just 10 of the companies that responded have added at least one woman to their boards to date.

“We’ve put our portfolio companies on notice that we want them to be responsive and adopt best practices when it comes to the composition of their boards,” DiNapoli said.

The comptroller could not be reached for comment.

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Tags: Diversity, New York State Common Retirement Fund (NYCRF), Pension, proxy voting, Sinclair Broadcast Group, Trip Advisor

Ruth Reyerson

The executive director of Wyoming’s $8.5 billion pension fund will retire in July. Ruth Ryerson is departing after almost six years, staying on to help the transition as the Wyoming Retirement System searches for her successor.

Staff praised Ryerson’s accomplishments, such as her “focus on building a strong management team at every level of the organization,” according to Laura Ladd, the pension plan’s board chair. Ladd also highlighted Ryerson’s guidance on launching the fund’s online pension administration system.

“She’s been incredibly responsive and optimistic,” Sam Masoudi, the fund’s chief investment officer, told CIO. “She’s always got a solution and she always known how to execute, especially in the public pension world, where there’s a lot of red tape and a lot of hoops to jump through. She always knows how to accomplish the mission.”

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In addition to Ryerson’s guidance, the retirement system’s board and its relationship with the state legislature, assumption rate changes also helped increase the fund’s stability, according to a news release.

“I came to WRS because of its good reputation and sincere concern for its members and their families. It has been very rewarding for me to take a good pension program, and keep it strong for the next generation,” Ryerson said.

Collaboration is another area Ryerson made a priority during her time with the fund. Ryerson, along with Sam Masoudi, the retirement system’s chief investment officer, built out the investment team and developed an intern program that cultivates local talent from the state university.

“In Wyoming there’s some reluctance to add any head countShe was helpful in selling the plan to the board and the legislators and getting us the resources we needed to succeed,” Masoudi told CIO. In a December interview, he said the program “has greatly benefited the pension, and Wyoming legislators love it, too.”

The fund added $2 billion to its value under Ryerson’s watch, and its performance was in the 30^th percentile of its peers in 2018.

She has fought for both contribution rate increases and benefit adjustments, which requires changes in state law.

“She’s often called to testify in front of the legislature’s Joint Appropriations Committee, which determines our budget.,” “She’s been very effective in communicating what the system needs and why it’s important by having one on one discussions with legislators to educate them on the issues.

Masoudi also praised Ryerson’s interpersonal skills and credibility with state lawmakers. “She’s unfailingly polite and respectful and just good at building relationships with them,” he said. “When they have a question and she gives an answer, they know she can be trusted.”

She also advocated for the law combining the volunteer firefighter and emergency medical tacticians’ plans, which is unique to the state. A new law has added search and rescue divisions to the plan.

“Wyoming is a special place and I will always fondly remember my time here,” said Ryerson.

The Wyoming Retirement System manages the pension assets of eight defined benefit plans: The Public Employees’ Pension Plan, Wyoming State Highway Patrol, Game & Fish Warden and Criminal Investigators, Firemen’s Pension Plan A and B, Judicial Retirement Plan, Wyoming Law Enforcement, Air Guard Firefighter, and the Volunteer Firefighter and EMT Pension Plan. Six of those plans have funding ratios above 75%.

The board immediately launched a replacement search following Ryerson’s announcement. It expects to announce the new executive at its May 15-16 meeting, according to Pensions and Investments. Vice Chairman Eric Nelson will lead the three-member search team, aided by consulting firm Align.

“Ruth’s done such a good job at building the organization that, from a staff perspective, we would not want her replacement to come in and make changes for the sake of making changes,” Masoudi said of his expectations for the next executive director. “I think [we’d like] somebody who can give us Ruth’s effectiveness and ability to work with the board –that combination of inside and outside skills… somebody who can quickly build collaborative relationships with the team, that’s going to be critical .”

Interested applicants should send a resume and cover letter along with three professional references by April 12, 2019, to WRSapps@TheAlignTeam.org.

The board’s target allocation mix is 44% public equity, 17.0% private investments, 19.0% marketable alternatives, 18% fixed income, and 2% tactical cash.

“Everybody’s going to miss her,” said Masoudi. “She’s just universally well-loved and respected. I literally have not heard someone say a bad word about her in five years.”

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Tags: Pension, Ruth Reyerson, Sam Masoudi, Wyoming Retirement System