You are on page 1of 2
DIVISION OF LEGAL SERVICES 110'State Steet ~ [4° Floor Albany, NY 12236 Tek (sia) 474-3444, STATE OF NEW YORK Fax: (18) 473.9106, OFFICE OF THE STATE COMPTROLLER THOMAS P. DINAPOLL STATE COMPTROLLER August 9, 2018 Mr. Richard Brooks Via email to Richard@350.org Dear Mr. Brooks: This is in response to your letter on behalf of 30 groups to Comptroller DiNapoli dated August 2, 2018, claiming that the appointment of Vicki Fuller, the former Chief Investment Officer of the Common Retirement Fund (CRF), as an independent director on the Board of Directors of the Williams Companies, Inc., a company in which the CRF invests, creates a conflict of interest. Your letter goes on to urge that the Comptroller begin a process of decarbonizing the CRF by shedding fossil fuel holdings within five years. Comptroller DiNapoli has asked me to respond to your letter. We are not aware of any facts to support a conclusion that Ms. Fuller’s post CRF- appointment as an independent director on the Williams Board creates a conflict of interest, not are we aware of any decision under the State's ethics laws by the Joint Commission on Public Ethies or its predecessor agencies that would prohibit her from accepting such an appointment. Ms. Fuller's plan to retire from State service was publicly announced in a press release issued by the Office of the State Comptroller (OSC) on May 11,2018. Ms. Fuller was aware that the State ethies law affected her pre- and post-retirement conduct, and she consulted with OSC’s Special Counsel for Ethics to clarify what those restrictions were and what she needed to do to comply with them. OSC’s Ethies Counsel advised her regarding State Ethics Commission ‘Advisory Opinion No. 06-01, which balances a State employee's ability to pursue employment opportunities outside State government with safeguarding government decision-making processes, should the potential employer have a matter where the State employee has official responsibilities ‘The Advisory Opinion concludes that a State employee, who receives an unsolicited post- government employment-related communication from an entity that has a specific matter pending before the State employee, must recuse him or herself from the matter and any contact with the entity for 30 days before entering into post-employment communications. With respect to the Williams Board opportunity, Ms. Fuller indicated to OSC’s Ethics Counsel that the company had no matters pending before the CRF at that time. The CRF’s Director of Operations has confirmed that there were no investment matters involving the Williams Companies pending during the relevant timeframe of May-July 2018. As such, based on the facts presented, there appears to be no basis to conclude that Ms. Fuller’s discussion of a future appointment presented a conflict of interest. OSC’s Ethics Counsel further advised Ms. Fuller of the two-year post-employment bar that prohibits a former employee’s appearance or practice on any matter before OSC, as well as the Richard Brooks August 9, 2018 Page 2 lifetime bar on appearing or rendering services on any transaction in which she was directly concemed, personally participated, or actively considered while in State service. As for the questions you raise in your letter about Ms. Fuller’s decision-making processes regarding her post- employment activities, these questions can be answered only by Ms. Fuller and should be addressed directly to her. With respect to the reference in your letter to Ms. Fuller’s public testimony opposing divestment from fossil fuel companies, Comptroller DiNapoli has publicly stated on many occasions that he does not believe that divestment from fossil fuels, at this time, is in the best interest of the CRF’s beneficiaries, nor is it an effective way to address the investment risks that climate change presents to the Fund, The Comptroller is acutely aware of the broad and far- reaching implications of climate change on the CRF’s investments and has, together with the Governor, assembled a panel of experts to advise him on strategies by which the CRF may identify, assess and address the investment risks and opportunities and prepare for a transition to a low carbon economy. Among the specific tasks with which the advisory panel is charged is consideration of strategies to divest from significant fossil fuel holdings. In addition to creating the expert advisory panel, Comptroller DiNapoli has been a leader in addressing climate-related investment risk by committing over $3 billion directly to sustainable investments, and creating and investing over $4 billion in a groundbreaking low emissions index fund, which reduces investments in companies with high carbon emissions and increases investments in companies with lower emissions while closely tracking its benchmark index. Ashas been widely reported, Comptroller DiNapoli has also advocated for climate change- related policy measures that will positively impact the CRF’s investments, including the Paris Agreement, the Clean Power Plan, tax credits for solar and wind power, low carbon fuel standards, carbon pricing, the Regional Greenhouse Gas Initiative, and SEC requirements for corporate disclosure of material carbon risks. Further, as a major shareholder, the Comptroller has urged hundreds of the CRF’s portfolio companies to reduce their greenhouse gas emissions, disclose their climate risks, and adapt their businesses to a low carbon economy. Recognizing that the actions of fossil fuel companies will have a major impact on the global efforts to address climate change, the Comptroller will continue his efforts as an investor to urge the CRF’s portfolio companies to take steps to assess and act on the very real risks posed by climate change. Comptroller DiNapoli has been recognized as an international leader in addressing the investment risks and opportunities presented by climate change, and consistent with his fiduciary duty to the more than one million members of the New York State and Local Retirement System, will continue his efforts to work to assess the climate-related risks to the CRF and develop effective strategies to address those risks, Sincerely, Haney fh prec nuvege Naney G. Seas Counsel to the Comptroller

You might also like