JEFFERSON CITY, Mo. – At the last meeting of the Missouri State Employees’ Retirement System (MOSERS) Board of Trustees, Missouri State Treasurer Scott Fitzpatrick led an effort to protect Missouri State Employee retirement funds from being used by activist investment managers to advance left-wing social and political causes which are harmful to shareholders and violate their fiduciary obligations to Missourians.
Treasurer Fitzpatrick worked with MOSERS staff and other board members on a plan to remove proxy voting power associated with MOSERS’ holdings in publicly traded companies from specific asset managers. The board voted to take MOSERS voting power away from asset managers, including Blackrock, Inc. The MOSERS Board Investment Committee will develop a proxy voting policy to be presented to the full board for approval. Until this policy is considered and approved by the Board, MOSERS staff will abstain from voting those proxies.
Proxy voting allows shareholders in companies to have a say in decisions on issues facing publicly traded companies and vote in elections for board members. Proxy voting power has historically been delegated to asset management firms who hold stock in companies on behalf of MOSERS, and millions of other investors, with the expectation that those firms would exercise those votes with their fiduciary obligation to maximize value for the retirement system and its beneficiaries being the sole consideration.
However, over the past several years, large asset managers such as Blackrock have begun to exercise the immense power they have amassed, by virtue of speaking on behalf of the customers whose money they are investing, to advance political causes that would be contrary to the wishes of most Missourians and which sacrifices return on investment for their customers. In one example of a betrayal of shareholders, several large asset managers who are advancing Environmental, Social and Governance (ESG) investment strategies used their proxy power to elect climate radicals to the board of Exxon, causing the company to scrap previously planned expansions in oil and gas production, and instead cut production. This decision has not only negatively impacted shareholders, but has contributed to skyrocketing prices at the pump for Missourians.
“The MOSERS Board voted to protect state employee retirees, and taxpayers whose money funds the pension system, from being exploited by left-wing, Wall Street asset managers,” Treasurer Fitzpatrick said. “MOSERS has an obligation to manage its assets in a way that prioritizes providing maximum possible returns for retirees and taxpayers. Large asset managers have become far too powerful, with the top three controlling $20 trillion in assets. We should not allow asset managers such as Blackrock, who have demonstrated that they will prioritize advancing a woke political agenda above the financial interests of their customers, to continue speaking on behalf of the state of Missouri. It is past time that all investors recognize the massive fiduciary breach that is taking place before our eyes, and do something about it. As Treasurer and as a member of the MOSERS Board, I will continue fighting for Missourians to stop their tax dollars from being weaponized against them.”
Treasurer Fitzpatrick serves on the MOSERS Board of Trustees as well as the Investment Committee and the Audit Committee.