Our Stand for the Free Market

Several states in our country have started blacklisting financial firms that don’t agree with their political views. They have created new policies and laws that restrict who they will do business with, reducing competition and restricting access to many high quality managers. This strategy has real costs that ultimately impact their taxpayers.

These blacklists are a backlash response on behalf of political and corporate interests seeking to interfere with the progress made by those of us who believe in collaboration and engagement. We work towards developing common goals, along with other investors and enlightened companies throughout the world. Our joint efforts have resulted in increased corporate responsibility, transparency, disclosure, and long term positive outcomes for the funds that we oversee, with greater benefits to employees and customers alike.    

The blacklisting states apparently believe, despite ample evidence and scientific consensus to the contrary, that poor working conditions, unfair compensation, discrimination and harassment, and even poor governance practices do not represent material threats to the companies in which they invest. They refuse to acknowledge, in the face of sweltering heat, floods, tornadoes, snowstorms and other extreme weather, that climate change is real and is a true business threat to all of us.

We disagree. 

Disclosure, transparency, and accountability make companies more resilient by sharpening how they manage, ensuring that they are appropriately planning for the future. Our work, alongside those of other investors, employees, and customers have caused many companies to evolve their business models and their internal processes, better addressing the long term material risks that threaten their performance. 

The evolving divide suggests that there will be two kinds of states moving forward: states focused on short term gains and states focused on long term beneficial outcomes for all stakeholders.   

This type of short term thinking imposes an ideological screen on an investment manager’s ability to perform or whether an investment banker can compete for the opportunity to underwrite debt. This screen negatively impacts competitive costs, and increases potential risks that will be left for others to deal with in the future. In the case of state and public pension funds, these losses will be borne by the taxpayers and that means all of us.   

Working toward long term success means every investment manager should be considered without an ideological or political screen. Companies should be challenged to think about the implications of predictable risks and use those insights gained to evolve their business models and seize opportunities. 

Today stakeholders, customers and employees are more diverse and informed. Companies that acknowledge these changes, and incorporate strategies to capture this reality are more innovative, creative and more financially successful, consequently better investments for long term investors. Organizations that recognize the threat of climate change are already working toward reducing their carbon footprint, while the automobile manufacturers have begun rapid movement to electric vehicles. Engaged investors are working with the fossil fuel companies to help them effectively manage the energy transition, supporting their efforts to seize new opportunities in renewable energies. Doing otherwise would be a huge risk to them and their investors.

States that focus solely on the short term will fail to compete over the longer time horizon that is necessary for them and their pension funds to succeed. They will miss potential growth because their focus is on preserving the status quo. And they will suffer from possible suits or challenges that longer term players will avoid due to more rigorous oversight.   

What has truly made America great in the past is how we Americans face risk and opportunity with courage and conviction. We seize the moments with eyes open to what the future can be and create ways to turn events to our advantage.

As we watch other states using blacklists to obstruct the free market, we want to make it very clear that we are in it for the long term. 


Henry E. M. Beck, Maine State Treasurer

Julie Blaha, Minnesota State Auditor

Malia M. Cohen California State Controller

Zach Conine, Nevada State Treasurer

Colleen C. Davis, Delaware State Treasurer

James Diossa, Rhode Island General Treasurer

Michael W. Frerichs, Illinois State Treasurer 

Sarah A. Godlewski, Wisconsin Secretary of State

Deborah B. Goldberg, Massachusetts State Treasurer and Receiver General 

Brad Lander, New York City Comptroller

Brooke Lierman, Maryland Comptroller

Fiona Ma, California State Treasurer

Laura Montoya, New Mexico State Treasurer

Michael J. Pellicciotti, Washington State Treasurer 

Mike Pieciak, Vermont State Treasurer

Tobias Read, Oregon State Treasurer

Erick Russell, Connecticut Treasurer

David L. Young, Colorado State Treasurer