In an op-ed published in the San Francisco Chronicle, Carlos Solorzano, the CEO of The Hispanic Chambers of Commerce of San Francisco, pushed back against divestment bill AB 20, making the case that the legislation will be harmful to businesses in San Francisco and across the state.
Solorzano argued that forcing the $310 billion fund to divest from energy stocks would create shortfalls and that “taxpayers will have to pick up for the tab to meet promised pensions that the investments don’t cover.” The taxpayers of California of course, form the main customer base for the businesses he represents. He added that “heaping additional losses on the state level leaves less money in the pockets of Californians on whom we rely to sustain our businesses.”
Solorzano is not alone in his criticism of AB 20. The editorial board of The Los Angeles Times called AB 20 “ill-considered,” “flawed,” “dangerous,” and “attention-getting.” The California’s Public Employees’ Retirement System (CalPERS) also spoke out against the bill on several occasions.
According to Solorzano, the best way to influence change is corporate engagement. “Stockholders can, and have, successfully enacted business reforms,” Solorzano stated. This closely reflects statements made by CalPERS Chief Operating Investment Officer Wylie Tollette, who recently was quoted as saying, “when you divest, you basically take our voice out of the debate.”
Calling on California’s elected officials to defer judgement to pension management officials, Solorzano concluded that, “decisions affecting California’s pension funds must be guided solely by what is best for the monies under their management.”
Read the full op-ed here.