LANSING, Mich. — Sen. Jim Runestad’s legislation to protect Michigan public pensions from politically motivated investing strategies was approved Tuesday by the Senate Committee on Finance.
“Decisions on investments need to focus on the finances to keep pension promises made to police officers, firefighters, public school employees, and thousands of other public employees,” said Runestad, R-White Lake. “A fiduciary’s sole duty should be to secure the pensions and therefore retirements of their members, not advancing personal or political agendas.”
Senate Bill 1192 would amend the Public Employee Retirement System Investment Act to require that only pecuniary factors, such as risk or return on investment, funding objectives and others be considered in the evaluation of investments — and that any noneconomic, nonfinancial, social, political, or ideological objectives not be considered.
Runestad introduced the legislation in September after the Michigan State University Board of Trustees removed a resolution from its agenda that would have called on companies doing business with the university to oppose the Secure MI Vote ballot initiative.
“If an activity is legal, then it is legal to invest in it, and we should not be pushing divestment in legal activities through political activity in the boardroom,” Runestad said. “This bill will ensure that Michigan keeps its promises to public employees, and to the taxpayers that would have to compensate for any future failures of our pensions.”
SB 1192 will now move to the full Senate for consideration.