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New York City Comptroller William C. Thompson, Jr. today announced that, in response to a shareholder resolution submitted by three of the City's Pension Funds, the Halliburton Company has agreed not to forge any new business ties with Iran .

In a letter to the Comptroller's Office, Halliburton wrote that "Halliburton will take appropriate corporate action to cause its subsidiaries to not bid for any new work in Iran ."

This was the second time the City submitted the proposal with Halliburton, calling on the company to thoroughly review its offshore subsidiary's connection with Iran . The New York City Fire Department Pension Fund, Police Pension Fund and Board of Education Retirement System submitted the proposal to Halliburton in December.

"Over the last two years, the New York City Pension Funds have aggressively targeted five companies that have used loopholes in the law to conduct business with terrorist-sponsoring nations," Thompson said. "I am encouraged that Halliburton and three other companies have since promised to take the necessary steps to ensure shareholders that they will not in any way advance the reach of terrorism through their business activities."

Thompson added: "I am hopeful that Halliburton's decision will prompt other companies to thoroughly examine their relationships with nations that sponsor terrorism. Companies must recognize the potential risks of continued operations with these rogue nations."

Earlier this year, Halliburton announced that it would sever all future ties with Iran . But Thompson sought formal, written, assurance from the company before entertaining a withdrawal of the City's shareholder resolution. In its letter, Halliburton notes that, while agreeing not to bid on new work, it would still honor "existing contracts and commitments which the subsidiaries have previously undertaken."

In response to Halliburton's letter, which was received late yesterday, the Comptroller withdrew the City's resolution.

The Halliburton proposal followed reports that Halliburton opened an office in Iran under the name Halliburton Products and Services Ltd., its Cayman Islands subsidiary, in February 2000.

esponse to pressure from the funds, Halliburton promised to designate a committee of its Board of Directors to review its operations and submit a report on those risks. However, contrary to that agreement, Halliburton's report failed to fully address the concerns.

Thompson subsequently re-filed the proposal, noting that Halliburton failed to comply with its agreement to produce a report detailing the potential financial and reputational risks of its Iranian operations. The measure went before shareholders at the company's annual meeting in May 2004; 22 million shares - 7.4 percent of the total cast - were voted in its favor, more than double the percent needed to allow the City to resubmit the proposal. The City's five funds have 1,457,000 Halliburton shares worth $42 million.

Additionally, the Police Pension Fund, Fire Department Pension Fund, New York City Employees' Retirement System, Teachers' Retirement System and Board of Education Retirement System recently submitted proposals to the Aon Corporation of Chicago, Cooper Cameron Corporation of Houston , Texas , and General Electric of Fairfield, Conn.

The proposals asked each to establish a committee of their Board of Directors to review their business ties to Iran with particular attention to potential financial and reputational risks. In letters to the companies, Thompson wrote that: " U.S. law currently restricts trade and investment activity by American companies with countries that are designated by the U.S. State Department as sponsors of terrorism. While the sanction does not apply to the foreign or off-shore subsidiaries of U.S. corporations, so long as the U.S. parent companies are neither directly nor indirectly involved, we believe that American companies should nonetheless adhere to the spirit as well as the letter of the law."

"I am concerned that [each] Company's business dealings in Iran could expose the Company to negative publicity, public protests, and a loss of investor confidence, all of which could have a negative effect on shareholder value," he said.

Since then, in respo nse to the City's efforts, General Electric and Cooper Cameron announced they would cease doing business in Iran . The funds have roughly 33,220,000 General Electric shares worth close to $1.1 billion, and 1,938,672 shares worth more than $52 million in Cooper Cameron. Previously, ConocoPhillips agreed with the City's request and agreed to en sure that its business activities do not violate "the spirit and the letter of U.S. law."

The trustees of the City's five systems are as follows:

New York City Fire Department Pension Fund: Comptroller Thompson; Mayor Michael Bloomberg; New York City Fire Commissioner Nicholas Scoppetta (Chair); New York City Finance Commissioner Martha E. Stark; Stephen Cassidy, President, James Slevin, Vice President, Robert Straub, Treasurer, and John Kelly, Brooklyn Representative and Chair, Uniformed Firefighters Association of Greater New York; Peter Gorman, President and Captains' Rep., Nicholas J. Visconti, Chiefs' Rep., and Stephen J. Carbone, Lieutenants' Rep., Uniformed Fire Officers Association; and, Joseph Gagliardi, Marine Engineers Association.

New York City Police Pension Fund are: Comptroller Thompson; Mayor Michael Bloomberg; New York City Finance Commissioner Martha E. Stark; New York City Police Commissioner Raymond Kelly (Chair); Patrick Lynch, Patrolmen's Benevolent Association; Michael Palladino, Detectives Endowment Association; Edwin Mullins, Sergeants Benevolent Association; Anthony Garvey, Lieutenants Benevolent Association; and, John Driscoll, Captains Endowment Association.

Board of Education Retirement System: Mayoral appointees Schools Chancellor Joel Klein, Alan Aviles, Phillip Berry, David Chang, Tino Hernandez, Augusta Souza Kappner, Richard Menschel and Marita Regan; Borough President appointees Jesse Mojica (Bronx), Martine G. Guerrier (Brooklyn), Jacquelyn Kamin (Manhattan), Michael Flowers (Queens), and Joan Correale (Staten Island); and employee members Thomas J. Malanga of the International Union of Operating Engineers, Local 891 , and Milagros Rodriguez of District Council 37, Local 372.

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