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June 11, 2007


DiNapoli Announces Program for Sudan Investments


State Comptroller Thomas P. DiNapoli today announced that the New York State Common Retirement Fund (Fund) will begin a series of steps to increase pressure on the Sudanese government to end the genocide in Darfur. DiNapoli said these steps will include a number of actions, up to and including the possibility of divestment.

“The genocide in Darfur is a challenge to our collective capacity to do good,” DiNapoli said. “As citizens we can neither be blind to this callous destruction of human life nor silent in its face.”

The actions to be undertaken by the Fund were developed in collaboration with members of the State Legislature and the Sudan Divestment Task Force.

“My first responsibility is to fulfill my fiduciary duty as sole Trustee of the Fund,” DiNapoli said. “The pension fund must be managed for the benefit of the members, beneficiaries and retirees, but I’m confident the members of the Retirement System do not want the pension fund to support governments that engage in genocide. And investing in companies that lend aid to these regimes is not conducive to long-term investment strategies.”

Assembly Speaker Silver said, “With the Sudanese government’s continuing refusal to accept a United Nations solution, it is imperative that this State and all states bring our economic leverage to bear on Sudan in order to end this crisis once and for all. The Office of the Comptroller has had a long tradition of fighting on behalf of members of the State’s retirement system to ensure that the pension fund does not support genocide. I applaud Comptroller DiNapoli for his leadership and action.”

“The Comptroller’s actions today will send a message to Sudan that genocide will not occur on New York’s watch and it will not occur on New York’s dime,” said Adam Sterling, director of the Sudan Divestment Task Force, a project of the Genocide Intervention Network. “One of the largest public pension funds in the world will no longer allow Sudan’s enablers access to its vast accumulated capital and the targeted and surgical nature of the Comptroller’s policy will simultaneously protect the State’s investment returns and innocent Sudanese civilians.”

In an effort to put pressure on the Sudanese government to end the genocide, the Fund has been actively engaged with many companies doing business in Sudan for the past three years. The new actions announced by DiNapoli today will be implemented in three phases.

The first phase, which will occur over the next three months, will involve extensive research to identify the companies the Fund has invested in that might be engaging in objectionable practices in Sudan. A letter has been sent to the Fund’s outside investment managers advising them of DiNapoli’s plan. The letter asks the managers to research their holdings and expresses DiNapoli’s preference that, pending their review, comparable Sudan-free investments take precedence over new investments in Sudan-related companies in a manner that is consistent with their sound investment strategies.

The second phase will be to actively engage those companies identified through the Fund’s research and encourage them to withdraw from Sudan or to begin taking substantial action aimed at providing carefully constructed humanitarian aid and relief for the Sudanese people. At the end of the second phase, DiNapoli will review what, if any, changes those companies have made as a result of this effort.

In the third phase, DiNapoli will develop strategies of divestiture from those companies that he determines have failed to take substantial action, if following a process of due diligence he determines that it is consistent with his fiduciary responsibilities.

DiNapoli said the Fund’s level of investment in Sudan is comparatively small. He estimated that less than one half of one percent of the Fund is invested in companies that may have a connection to Sudan. The steps he is taking will apply to active and passive investments, both internally and externally managed.

DiNapoli noted that while his actions are a forceful use of the Fund’s ability to influence companies’ behavior, previous comptrollers have responded to other geo-political situations. In the 1990s, Comptroller McCall stopped any additional pension fund investment by active managers in domestic tobacco companies and provided guidelines and reporting requirements for companies operating in Northern Ireland in response to religious discrimination. In another instance, as New York City Comptroller, Comptroller Hevesi won reparations for Holocaust victims. Comptroller Regan took steps as a shareholder to address apartheid in South Africa in the 1980s.

“We will not take any half steps, and we will not turn back,” DiNapoli said. “This is genocide. There can be no half steps.

“This is a logical extension of steps taken by prior comptrollers. The Bush Administration has turned up the economic pressure on the Sudanese government. We will continue to do whatever we can within the bounds of my legal fiduciary responsibilities to help end the genocide in Darfur.”

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