CalSTRS Releases First Annual Corporate Governance Report
Overview of shareholder activism seeks to increase shareholder value over time.
WEST SACRAMENTO, CA – The California State Teachers’ Retirement System (CalSTRS) has released the Corporate Governance 2013 Annual Report, the first such report at CalSTRS.
The document communicates CalSTRS’ corporate governance philosophy while outlining its current major initiatives, such as executive compensation; majority voting; dual class ownership; boardroom diversity; and sustainability. CalSTRS pursues its corporate governance initiatives via engagement, shareholder proposals and proxy voting.
“As patient, institutional investors, CalSTRS is here for the long term. We want companies in our investment portfolio to perform well long into the future, and sound corporate governance practices are a critical component to accomplishing just that,” said CalSTRS Chief Executive Officer Jack Ehnes. “This first-ever annual report shows that the efforts of our corporate governance policies on a range of fronts are bearing fruit.”
The report identifies CalSTRS’ key partnerships with other international institutional investors, how it voted its proxies, as well as the performance of the unit’s activist manager portfolio.
“As this report clearly shows, we will be holding boards accountable and engaging with companies to change their practices in ways that benefit shareholders, and create long-term value for investors,” said CalSTRS Director of Corporate Governance Anne Sheehan.
Initially established in 1978, CalSTRS’ Corporate Governance program protects members’ assets by promoting the fundamentals of good corporate governance throughout its portfolio of publicly held companies. CalSTRS advances its initiatives through proxy voting, portfolio company engagement, filing of shareholder proposals and portfolio management. The report joins CalSTRS proxy voting guidelines, investment policies, encompassing corporate governance principles and CalSTRS 21 Investment Risk Factors, to articulate the governance framework of CalSTRS efforts to steward the fund.
The California State Teachers’ Retirement System, with a portfolio valued at $166 billion as of June 30, 2013, is the largest educator-only pension fund in the world. CalSTRS administers a hybrid retirement system, consisting of traditional defined benefit, cash balance and voluntary defined contribution plans. CalSTRS also provides disability and survivor benefits. For 100 years, CalSTRS has served California’s public school educators and their families, who today number 862,000 from the state’s 1,600 school districts, county offices of education and community college districts.