Comptroller Stringer Launches New Working Group to Maximize Diversity for NYC’s Pension Funds and Announces Diverse Practitioner Award Recipients

(New York, NY) — Today New York City Comptroller Scott M. Stringer announced the creation of a Diversity Working Group in his office’s Bureau of Asset Management to pinpoint ways to include diverse investment staff, asset managers, and suppliers in the City’s Pension Funds. Comptroller Stringer made the announcement at the office’s annual conference for investment managers, outlining how the Pension Funds’ work on diversity has helped the portfolio grow over the last three years.

“Diversity isn’t a box to be checked — it’s a strategy for economic success. Diverse perspectives matter, and companies that embrace that ethos perform better. That’s why protecting hundreds of thousands of New Yorkers’ retirement security goes hand-in-hand with supporting M/WBEs, diversifying boardrooms, and more,” New York City Comptroller Scott M. Stringer said. “Today, we’re doubling down on that model, and we’re working to ensure the firms we work with and those who invest our pension dollars reflect the extraordinary diversity of New York.”

At the conference, Comptroller Stringer announced the recipients of the 2017 Diverse Practitioner Award — Neuberger Berman and Vista Equity Partners. The award was launched by Comptroller Stringer in 2016 to celebrate investment managers for the New York City Pension Funds that have demonstrated excellence in forming diverse decision-making teams and developing strong policies and practices to promote diversity and inclusion. The award recognizes that diversity is correlated to stronger economic performance, better risk management, and long-term success, while encouraging a greater focus on improving diversity in finance.

Comptroller Stringer’s new Diversity Working Group will be comprised of internal staff broadly representing functions of the Bureau of Asset Management and will work to foster diversity and improve investment outcomes. The Working Group will help deliver new ideas for employment, investment manager selection, and supplier diversity, and will work in consultation with the Office of the Comptroller’s Equal Employment Opportunity (EEO) Officer, Bureau of Administration, and Chief Diversity Officer.

That group will build on the work done by Comptroller Stringer over the last three years to boost investments with minority- and women-owned investment firms and encourage all money managers to diversify their companies. Specific accomplishments include:

• Increasing the amount invested with M/WBE managers to $12 billion — a 25% increase since 2013. During that time period:
  • Private Equity investments with M/WBE managers grew from 14% to 20%;
  • M/WBE-managed Opportunistic Fixed Income investments increased from 0% to 6%;
  • Investments with M/WBE-run hedge funds jumped from 0% to 13% — despite the fact that 97% of hedge funds are owned by white men;
• Becoming the first public pension system to ask every investment manager for the diversity of their leadership team and investment team to be considered as a part of the Comptroller’s Office’s due diligence process;
• Strengthening the Office’s “graduation policy” to create greater incentives to allocate more funds directly to successful smaller firms, including M/WBE managers;
• Setting M/WBE brokerage goals for all public equity and public fixed income investment managers and increasing outreach to managers to encourage them to use M/WBE brokers – the firms that actually make the trades – 20% to 25% of the time.

Launching the “Boardroom Accountability Project” — a global campaign to give shareowners a voice in selecting who sits on a company’s board through a reform known as “proxy access.” In the last three years, the number of companies with this reform has grown from six to more than 400. Seventeen companies targeted for little or no board diversity have added a woman or person of color.

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