Corporate Governance and Responsible Investment
Consistent with the fiduciary obligations of the New York City Pension Funds’ Boards of Trustees, the Office of the Comptroller’s Corporate Governance and Responsible Investment team promotes sound corporate governance at portfolio companies – including accountability in the boardroom, responsible executive compensation, and sustainable business practices – in order to protect and enhance the long‐term value of the New York City Pension Funds’ investments. By encouraging portfolio companies to follow prudent governance and sustainable business policies – including responsible labor, human rights and environmental practices – the Comptroller’s Office works to safeguard the retirement savings of the employees and retirees of the City of New York and deliver sustainable investment results over the long-term.
Principles of Good Governance
The New York City Pension Funds promote five basic principles at the companies in which they invest:
- Accountability: Portfolio companies should adopt policies and practices by which the board of directors is accountable to shareowners.
- Investor Rights: Shareowners should have strong investor rights and protections.
- Aligned Interests: Directors and executives should have incentives that align their interests with those of shareowners.
- Transparency: Financial markets work more efficiently when companies provide shareowners with accurate, thorough, and timely information on material matters.
- Sustainability: Companies should effectively manage financial, governance, social, environmental, and other material risks to long-term performance and advance policies and practices that create sustainable shareowner value.
Proxy Voting and Engagement
The New York City Pension Funds, and the Comptroller’s Office acting on their behalf, actively exercise their rights as investors to advance principles of good corporate governance, including through:
- Proxy Voting: Responsibly voting proxies and advocating sound corporate governance in line with Corporate Governance Principles and Proxy Voting Policies, as adopted by the Funds’ trustees.
- Company Engagement: Actively monitoring and engaging companies on their environmental, social and governance policies, practices and disclosures, including by filing shareowner proposals.
- Regulatory Advocacy: Advocating for regulatory and policy reforms to strengthen shareowner rights, improve corporate disclosure, and improve the integrity and sustainability of financial markets and the economy.
- Active Collaboration: Collaborating with other long-term investors, both formally as active members of numerous institutional investor associations, and informally, to advance sound governance and sustainable business practices at individual companies and across the market.
- Legal Action: Exercising the right to pursue legal action to recover losses on behalf of the Fund’s beneficiaries and other affected investors in select cases of egregious fraud, misconduct, or corporate malfeasance.
The Office of the Comptroller actively collaborates with other institutional investors on behalf of the New York City Pension Funds to advance sound governance practices in the market. As part of this cooperation, the Comptroller’s Office and/or the New York City Funds, individually or collectively, are affiliated with the following corporate governance associations: