Socially Responsible Investments

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					   Socially Responsible Investments:

   Government Finance
   Officers Association Conference



By Edward Siedle, President, Benchmark
        Financial Services, Inc




BUY HIGH,


SELL LOW.




                                         1
 OOOOPS……………

 BUY LOW, SELL HIGH

 TIME TO SELL: WHEN PUBLIC OUTCRY IS
 STRONGEST?
 TIME TO BUY: BUBBLES?




History of Socially Responsible
Investing
 As long as investing has existed, social policy issues
 have entered into the decision-making process.
    Religious origins:
       Quaker Pacifism
       Islam prohibitions
       Slavery, Child Labor, Alcohol, Tobacco, Firearms
       concerns held by many churches.

    Investment policies of nation’s earliest mutual funds
    reflected these concerns:
        George Putnam Fund of Boston

    Wall Street’s secret love affair with socially responsible
    investing




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Looking Beyond the Numbers: The
BIG Question
 When should social/policy concerns trump
 investment considerations?

 Wanna buy shares in Canyon Ranch?




More Current Issues
 Iran and Sudan Divestment Act
 California Responsible Private Equity
 Investment Act: sovereign wealth funds
 Minority Issues
 Women Issues
 Low Income
 Local Investing




                                            3
Fiduciary Duty versus Social
Concerns
 Federal Law: ERISA (does not cover public
 funds)

 State Law: Public Funds




Constitutional Issues




                                             4
Compliance Issues
 Once you create Socially Responsible
 Investment directives, implementation,
 interpretation and compliance issues will
 surface.




Creating Workable Socially
Responsible Investment Programs
 The Fund will direct 50% of its domestic
 equity trades to African American and
 Hispanic-owned brokerage firms located
 within the City of Chicago at 4 cents per
 share.




                                             5
Conclusion
 When You Open That Door, Be Prepared for
 Whatever Seeps In.
 Is CALPERS truly a Socially Responsible
 Investor?




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