By MADISON HIRNEISEN
THE CENTER SQUARE
(The Center Square) – As Russia’s invasion of Ukraine continues, Gov. Gavin Newsom called on several state entities Tuesday to use its global investment portfolio to sanction the Russian government.
Gov. Newsom penned a letter to the leaders of the California Public Employees’ Retirement System (CalPERS), the California State Teachers’ Retirement System (CalSTRS) and the University of California retirement system, asking them to “immediately restrict Russian access to California’s capital and investments.”
“Russia’s brazen and lawless military assault on Ukraine demands our support for the Ukrainian people and exacting an immediate and severe cost upon the Russian government in response to its continuing aggression,” the governor wrote.
According to the governor’s letter, CalPERS, CalSTRS and the UC retirement system hold a combined $970 billion in assets – equivalent to 60% of Russia’s entire gross domestic product last year. Of those investments, about $1.5 billion is a range of financial instruments, including stock of multinational corporations and real asset investments, “that have some nexus or relation to Russia’s financial markets,” the letter states.
Given the “fiduciary duties” the state has to thousands of Californians who have invested in the retirement systems, Gov. Newsom called for the entities to restrict Russian access to the state’s capital and investments.
“Given heightened financial risks, no fund shall purchase Russian debt and no money shall flow from the state of California to Russia,” Gov. Newsom wrote. “Furthermore, the funds should immediately assess risk to the retirees of our state and ensure that the actions you take protect the interests of your current and future retirees.”
Gov. Newsom’s call for state pension systems to sell their investments in Russia comes as several states are making similar moves.
In Colorado, the state’s public employee pension fund is withdrawing more than $7.2 million held in a Russian bank. Additionally, North Carolina Gov. Roy Cooper issued an executive order on Monday that called for all state agencies and departments to terminate existing state contracts and agreements that benefit Russia.