Serving To Protect Your Pensions
Meet a few AFSCME members with seats on pension boards.
The collapse several years ago of Enron and WorldCom reduced the value of public pension systems nationwide by $300 billion. That's why it's so important to have savvy trustees. They serve on boards composed of current and retired employees and appointed officials, and are responsible for investing and protecting the retirement assets of the systems' members.
One such trustee is AFSCME's Priya Sara Mathur, who keeps a sharp eye on workers' retirement investments. "There is a real pivotal role for institutional investors to protect not only ourselves and our members, but the entire American public and, frankly, investors throughout the world," she says.
Mathur, a principal financial analyst for the San Francisco Bay Area Rapid Transit (BART) District and a member of Local 3993 (Council 57), serves on the board of the California Public Employees' Retirement System. As the country's largest public pension system (with a $200 billion portfolio), CalPERS, according to Mathur, has a special responsibility to use its enormous clout on behalf of all investors — not just its own members: "We have every right — and a fiduciary duty to our pension-system members — to speak out about how our companies can enhance the long-term value of the capital we've given them."
Mathur is one of at least 48 AFSCME members, retirees or staff who sit on 28 state and municipal boards. Several of them recently discussed their responsibilities, challenges and determination to advocate on behalf of workers. The job requirements: common sense, a willingness to learn and the desire to protect the investments of plan participants.
WATCHFUL EYES. Besides working to prevent corporate scandals, union members have a pressing reason for joining pension boards: to protect the jobs of the workers who contribute to the system. "We certainly don't want government employees' money invested in a company that's going to privatize our work," explains Maryland corrections officer Sheila Hill, president of Local 1319 (Council 92) and a second-term trustee of the State Retirement and Pension System. "Nor do we want to invest in a company that pays its CEO an exorbitant salary while its labor force is making poverty wages."
Unlike Mathur, fund trustees are not necessarily financial experts. "You don't have to be a Wall Street stockbroker to sit on these boards," says David Fillman, a trustee appointed to the $28-billion Pennsylvania State Employees' Retirement System. Executive director of Council 13 and an International vice president, Fillman says that "most of our AFSCME members would have what it takes to handle the job."
What does it take? One person who knows is George Masten, a trustee of the Washington State Investment Board and a retired executive director of Washington Federation of State Employees/AFSCME Council 28. "In my judgment," he explains, "an effective trustee is one who really concentrates on listening, who reads all the material put before him or her, pays attention to what the experts and the staff have to say, and has the ability to use common sense" in order to advance the interests of working men and women.
Equally important, adds Hill, is "standing up for what's right and voicing your opposition when you feel the board is making a wrong decision." Most members of a pension system "don't know what's going on with their money. So I've been a voice for them."
RISKS & REWARDS. AFSCME has helped many of the present trustees win their board elections, and is committed to promoting the election of qualified members who seek to help protect their co-workers' pensions. As advocates for workers, however, union members are not always welcome on pension boards — at least at first.
Loretta Lopez, a former president of New Mexico Local 3022 (Council 18) and an AFSCME retiree, knows that well. In 2004, she was one of three AFSCME candidates elected to that state's Public Employees Retirement Association. Two of the candidates defeated incumbents, including the son of a powerful legislator. "So you can imagine what we walked into — we took out the good-ol'-boy system," she recalls. Eventually, Lopez and her two colleagues gained the respect of the other trustees.
Overall, says Mathur, who has just been re-elected to the CalPERS board by acclamation, the rewards of pension trusteeship outweigh the challenges: "Where else can I really make a contribution to the lives of 1.4 million public employees, retirees and their families served by CalPERS?" - C.W.
