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 theRichard 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