CalSTRS Gets Rapid Response to Board Diversity Effort
131 California companies with no women on their boards of directors receive offers of help
WEST SACRAMENTO, Calif. – The California State Teachers’ Retirement System (CalSTRS), in collaboration with the California Public Employees’ Retirement System (CalPERS), sent the 131 California companies in their portfolios that lack women directors a letter offering their combined expertise to help diversify their boards.
This is the first campaign to broadly engage with California companies that could benefit from placing women on their boards. Companies responded with action – not rhetoric – to this joint letter-writing campaign. In just four months, 35 companies have responded to the letter and 15 companies have added at least one woman to their boards of directors.
“We are pleased that a number of companies we contacted recognized board diversity as an important governance practice. In fact, ServiceNow added two women to their board this July,” said CalSTRS Director of Corporate Governance Anne Sheehan. “These companies took rapid action proving that change doesn’t take millennia – it can happen quickly if there’s a process and the requisite will.”
“This is a fantastic response to our work to improve board quality and diversity,” said Anne Simpson, CalPERS Senior Portfolio Manager and Director of Global Governance. “California is a vibrant economy that will be supported by these efforts. As the nation’s two largest funds, it’s great to have our home state set an example for others to follow. It’s also proof that with appropriate, constructive engagement we can influence positive results in our portfolio companies.”
The data supporting the letter-writing campaign was obtained from the 2013 UC Davis Study of California Women Business Leaders. Along with the letter, each company received a copy of the National Association of Corporate Directors Blue Ribbon Commission Report, The Diverse Board: Moving from Interest to Action, which was endorsed by both CalSTRS and CalPERS.
“We’ve worked with many national and global companies on this issue and decided it was time to look in our own backyard,” noted CalSTRS Portfolio Manager Janice Hester-Amey, who leads board diversity outreach efforts for CalSTRS. She added, “As long-term investors we see board diversity as a strategic practice for a company’s long-term sustainable value.”
The California State Teachers’ Retirement System, with a portfolio valued at $186.6 billion as of July 31, 2014, 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. CalSTRS serves California’s 868,000 public school educators and their families from the state’s 1,600 school districts, county offices of education and community college districts.