NYC pension funds divest from Iran

The five New York City pension funds selling shares worth $10.8 million in two companies with business ties to Iran have been asked to adopt resolutions for the phased divestment of holdings in eight more companies with ties to the country which, in total, have a market value of more than $141 million.

The recommendation came from New York City Comptroller William C. Thompson Jr, who said the decision was based on numerous events and factors, including “the Iranian government’s recent efforts to strengthen its nuclear weapons program and steal its presidential election”.

The two companies involved are Oil and Natural Gas Limited and PetroChina Company, and the sale is expected to result in an overall profit for the funds.

In addition, Thompson has recommended that the boards promptly adopt resolutions authorising the phased liquidation of investments in: Petrol Brasileiro, Samsung Engineering, Inpex, OMV, Sinopec, China National Offshore Oil Corporation, Wartsila and Repsol SA, all of which have significant ties to Iran.

This is consistent with the New York State Common Retirement Funds’ recent decision to divest from nine companies, five of which are listed above, and the actions taken by many other public pension systems.

In a statement, Congressman Anthony Weiner voiced his concerns about six other companies with ties to Iran, and urged the City funds to follow the lead of New York State and 15 other states that have divested from investments in companies doing business with Iran’s energy sector.

“Iran funds terrorism,” he said. “They send weapons and resources to attack Israel. If these businesses do not stop supporting countries blocking peace in the Middle East and advocating the annihilation of Jews on their own, then we’re going to crack down on them.”

Recently, Thompson urged US Congressman Barney Frank, chair of the financial services committee, to include in his “Iran Sanctions Enabling Act” provisions that would offer additional protections, including indemnification, for large investors such as the City pension funds that choose to sell shares in companies doing business with Iran.

Since November 2002, the Comptroller’s Office and pension funds have successfully persuaded six of America’s largest companies to sever their ties with nations that conduct business with Iran. These companies are: ConocoPhillips, Halliburton, Cooper Cameron, Aon, Foster Wheeler, and General Electric.

In 2005, the Office broadened its efforts and urged a number of companies to describe their policies and safeguards to mitigate the risks to their stock prices and reputations posed by their business ties to Iran.

The Comptroller is the investment adviser to and custodian for the five New York City pension funds: the New York City Employees’ Retirement System, the Teachers’ Retirement System for the City of New York, the New York City Police Pension Fund, the New York City Fire Department Fund and the New York City Board of Education Retirement System.