View Apache resolution
View SEC decision

New York City Comptroller William C. Thompson, Jr. and the New York City Pension Funds today criticized the federal Securities and Exchange Commission (SEC) for allowing the Apache Corporation to avoid giving shareholders a vote on a measure to ban discrimination based on sexual orientation and gender identity.

“This is outrageous and blatantly contradicts the SEC’s established record on these matters,” Comptroller Thompson said. “The SEC’s decision sends a clear message that companies do not have to protect workers from anti-gay bias, and this is wrong.”
Earlier this year, the Pension Funds filed a shareholder resolution calling on two dozen of America’s largest companies – including the Houston, TX-based company - to bar discrimination based on sexual orientation and gender identity – nearly twice as many proposals as in the previous proxy season. To date, eight of those companies have agreed to make the change.

But Apache wrote to the SEC, asking for assurance that there would not be any enforcement action against Apache if it were to exclude the resolution from its proxy materials this season. Staff of the SEC’s Division of Corporation Finance recently granted Apache’s request by issuing a “no-action” letter.

“There appears to be some basis for your view that Apache may exclude the proposal,” the SEC staff wrote. “We note in particular that some of the principles relate to Apache’s ordinary business operations. Accordingly, we will not recommend enforcement action to the Commission if Apache omits the proposal from its proxy materials.”

 Thompson, whose office filed papers documenting the SEC’s prior denial of “no-action” relief with respect to an identical shareholder proposal less than a year ago, said the New York City Pension Funds and his office are now exploring legal options such as appealing the SEC Staff decision to the full Commission and/or filing a lawsuit against Apache.
“Corporate America must embrace acceptance and afford all employees the same protections, regardless of their sexual orientation or gender identity,” Thompson said. “Each year, more companies are making this commitment because they believe in guaranteeing equal treatment in the workplace and that a diverse workplace is good for business. The SEC’s decision flies in the face of all the progress that has been achieved.”

You can read the City’s resolution and the SEC’s decision at www.comptroller.nyc.gov.

The five New York City Pension Funds are the: New York City Employees’ Retirement System (NYCERS), New York City Police Pension Fund, New York City Fire Department Pension Fund, New York City Teachers' Retirement System (TRS) and New York City Board of Education Retirement System. Collectively, they have 930,337 shares valued at more than $100 million in Apache.

The resolutions specifically called for companies that have not already done so to revise their policies to forbid discrimination based on sexual orientation and gender identity. This is the second proxy season in which all new measures include gender identity.

In addition to Apache, this season’s resolutions were filed with: HCC Insurance Holdings of Houston, TX; Timken Company of Canton, OH; ExxonMobil Corp. of Irving, TX; AK Steel Corp. of Middletown, OH; Fidelity National Financial, Inc. of Jacksonville, FL; Brink’s Company of Richmond, VA; Liberty Global, Inc. of Englewood, CO; Lyondell Chemical Company of Houston, TX; Eastman Chemical Co. of Kingsport, TN; Tesoro Corp. of San Antonio, TX; Murphy Oil Corp. of El Dorado, AR; Kelly Services, Inc. of Troy, MI; EchoStar Communications Corp. of Englewood, CO; Huntsman Corp. of Salt Lake City, UT; Marshall & Ilsley Corp. of Milwaukee, WI; Frontier Oil Corp. of Houston, TX; Borg Warner. Inc. of Auburn Hills, MI; Anadarko Petroleum Corp. of The Woodlands, TX; Synovus Financial Corp. of Columbus, GA; Erie Indemnity Company (Erie Insurance) of Erie, PA; SPX Corporation of Charlotte, NC; American Financial Group, Inc. of Cincinnati, OH; and, Leggett & Pratt, Inc. of Carthage, MO.

The Funds hold nearly 30 million shares worth nearly $2.2 billion in those companies.

This season to date, seven companies have agreed to make the change: Erie Indemnity, SPX Corp., The Brink’s Company, Synovus Financial Corp., AK Steel Corp. and Marshall & Ilsley Corp., and Liberty Global. The Comptroller’s Office has since withdrawn those resolutions.

This is the eighth time that the Funds have filed a measure with ExxonMobil, with each year bringing stronger support from its shareholders. The measure calls for ExxonMobil to amend its Equal Employment Opportunity policy to bar discrimination based on sexual orientation and gender identity.

Shareholder support for the proposal has increased in each subsequent year it has been filed: in 2007, it was supported by 37.7 percent of shares voted; in 2006, it was supported by 34.6 percent of shares voted; and in 2005, it was supported by 29.4 percent.

“We must remain steadfast in our efforts to bring about change and urge ExxonMobil to establish equal rights in the workplace,” Thompson said. “While it is heartening that a number of shareholders agree that ExxonMobil must take steps to provide equal protections for all employees, it is extremely troubling and downright unacceptable that ExxonMobil has strongly resisted the call.”

The resolutions build on proposals submitted by the Pension Funds for more than a decade asking dozens of Fortune 500 companies to adopt policies that explicitly prohibit discrimination based on sexual orientation.

To date, 52 companies have amended their policies to include protections against discrimination based on sexual orientation and/or gender identity.

Besides Thompson, the New York City Pension Funds’ trustees are:

New York City Fire Department Pension Fund: 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; Michael Currid, Captains’ Rep.; John J. McDonnell , Chiefs’ Rep., and Stephen J. Carbone, Lieutenants’ Rep., Uniformed Fire Officers Association; and, Joseph Gagliardi, Marine Engineers Association.

New York City Police Pension Fund: 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; Edward D. Mullins, Sergeants Benevolent Association; Thomas Drogan, Lieutenants Benevolent Association; and, Roy. T. Richter, Captains Endowment Association.

New York City Employees’ Retirement System: New York City Finance Commissioner Martha E. Stark (Chair); New York City Public Advocate Betsy Gotbaum; Borough Presidents Scott Stringer (Manhattan), Helen Marshall (Queens), Marty Markowitz (Brooklyn), Adolfo Carrion (Bronx), and James Molinaro (Staten Island); Lillian Roberts, Executive Director, District Council 37, AFSCME; Roger Toussaint, President Transport Workers Union Local 100; and, Gregory Floyd, President, International Brotherhood of Teamsters, Local 237.

Teachers’ Retirement System: New York City Finance Commissioner Martha E. Stark (Chair); Deputy Chancellor Kathleen Grimm, New York City Department of Education; and, Sandra March, Melvyn Aaronson and Mona Romain, all of the United Federation of Teachers.

Board of Education Retirement System: mayoral appointees Schools Chancellor Joel Klein, Alan Aviles, Philip Berry, David Chang, Tino Hernandez, Edison O. Jackson, Richard Menschel and Marita Regan; Luis Peguero (Bronx), Patrick Sullivan (Manhattan), Wendy Gilgeous (Brooklyn), and Joan Correale (Staten Island); and employee members Joseph D'Amico of the IUOE Local 891 member and Milagros Rodriguez of District Council 37, Local 372.

###