December 12, 2003
Jonathan G. Katz
Re: File No. S7-19-03
The Council of Institutional Investors (Council), an organization of more than 300 investment professionals, including more than 140 public, corporate and union pension funds with more than $3 trillion in investments, the National Association of State Retirement Administrators (NASRA), which represents directors and administrators of the nation's state employee retirement plans and the largest statewide public retirement systems responsible for combined assets exceeding $1.4 trillion and the National Council on Teacher Retirement (NCTR), which represents 77 state, territorial, local, and university pension systems serving more than 16 million active and retired teachers, non-teaching personnel, and other public employees and holding combined assets of more than $1.4 trillion, support the Commission's proposal to amend the proxy rules to give shareowners limited access to management's proxy card to nominate directors. (Lists of our members are attached.) However, the Council, NASRA and NCTR believe that certain modifications would enhance the proposed rule.
Sixty years have passed since the Securities and Exchange Commission first considered whether shareowners should be able to include director candidates on management's proxy card. This reform has been studied for decades and is long overdue. Its adoption would be the single most significant and important investor reform adopted by any regulatory or legislative body in decades. We congratulate and thank the SEC for its leadership in this important area.
The corporate scandals of the past few years have highlighted a longstanding concern-some directors are not doing the jobs expected by their employers, the shareowners. Compounding the problem is the fact that in too many cases the director nomination process is flawed, largely due to limitations imposed by companies and the securities laws.
Some boards are dominated by the CEO, who plays the key role in selecting and nominating directors. All-independent nominating committees ostensibly address this concern, but problems persist. Some companies don't have nominating committees, others won't accept shareowner nominations for directors, and our members' sense is that shareowner-suggested candidates-whether or not submitted to all-independent nominating committees-are rarely given serious consideration.
Shareowners can now only ensure that their candidates get full consideration by launching an expensive and complicated proxy fight-an unworkable alternative for most investors, particularly fiduciaries who must determine whether the very significant costs of a proxy contest are in the best interests of plan participants and beneficiaries. While companies can freely tap company coffers to fund their campaigns for board-recommended candidates, shareowners must spend their own money to finance their efforts. And companies often erect various obstacles, including expensive litigation, to thwart investors running proxy fights for board seats.
We believe that reasonable access to company proxy cards for long-term shareowners would address some of these problems. We believe such access would substantially contribute to the health of the U.S. corporate governance model and U.S. corporations by making boards more responsive to shareowners, more thoughtful about whom they nominate to serve as directors and more vigilant about their oversight responsibilities.
More detailed responses to the various issues raised in the release are included in the attached appendix, which was prepared by the Council. Our comments are based on the following Council policy:
This policy is intended to be straightforward and intentionally limiting-reflecting the overriding principle that any access mechanism should not be used to affect a change in control.
While the SEC's proposal is an important and significant step in the right direction, the Council, NCTR and NASRA believe the following modifications would strengthen the proposed rule and enhance its effectiveness.
The Council, NCTR and NASRA appreciate this opportunity to comment. Please contact us with any questions.
cc: Chairman William H. Donaldson
Council of Institutional Investors
The Council of Institutional Investors wholeheartedly supports revising the proxy rules to give shareowners the right to include director nominees on company proxy cards. Current alternatives for shareowners to have a meaningful say on director nominations are not working and have not worked for decades.
The Council believes that the value of enhanced director accountability, the primary benefit of the proposed mechanism, would far outweigh the very limited costs of including additional director candidates on management's proxy card and in management's proxy materials. Of course, companies and sponsoring shareowners may elect to devote significant resources to electing their candidates. However, these costs are discretionary and not relevant to the analysis of the costs and benefits of the proposed mechanism.
Another benefit of the proposed mechanism is that shareowners would have the option to elect "outside" directors with new viewpoints. Groups such as boards of directors benefit from members' diverse perspectives and different experiences. An emphasis on boardroom collegiality-a focus of the business community-can be harmful when it leads to "groupthink," a term introduced by Irving Janis in 1971 to refer to situations when an emphasis on group cohesion and unity outweighs efforts to realistically evaluate alternative courses of action. Groupthink can lead to poor judgments and bad decisions. The Council does not believe that adding new viewpoints would harm boardroom operations. Indeed, such fresh perspectives may protect against groupthink and invigorate boardroom discussions.
The proposed access mechanism is intended to address situations "where there are indications that the proxy process has been ineffective or that security holders are dissatisfied with that process." Since such problems aren't isolated to certain companies, the Council believes the rule should apply to all companies subject to the proxy rules, including investment management firms.
The Council opposes restricting the rule to accelerated filers or imposing other limitations or carve-outs for companies taking specific steps or actions, such as adopting shareholder-recommended actions or including shareowner resolutions on proxy cards. Such limitations would significantly weaken the effectiveness of the rule.
State Law Considerations
Ideally, all companies, regardless of state laws, should be eligible for the proposed access procedure.
The Council understands that the SEC must craft the rules to work with state laws, but we are very concerned that the proposed state law carve-outs will negatively impact the effectiveness of the rule.
Time and again, we have watched state legislatures rush to approve last minute laws designed to protect in-state-incorporated companies. The Council is concerned that adoption of this rule would result in intense, big money corporate lobbying efforts to pressure states into adopting new laws banning or limiting shareholder nominations. Such pressure would be most intense after one or more companies report that triggers activating the mechanism are satisfied.
And of course, some companies may have already amended their bylaws and charters, if permitted, to eliminate or weaken the right of shareowners to use the access mechanism.
The end result is ironic-the companies most unresponsive to investors and displaying the most problems with the proxy process are likely to be the ones most inclined to run to their state legislatures for protection or, if permitted, to adopt bylaw or charter amendments restricting shareowner involvement in the director nomination process or imposing procedural hurdles and other blocks to shareowners.
Compounding these problems is the fact that shareowners are generally unaware of state law changes and bylaw and charter amendments affecting shareowner rights.
To remedy this problem, the Council requests that the SEC require prompt 8-K disclosure of any amendments to company charters or bylaws-including the adoption of any procedural requirements-since Oct. 14, 2003, and of any state law changes since Oct. 14, 2003, affecting the applicability of the access mechanism. This disclosure is consistent with a pending SEC rule change that would require near immediate Form 8-K disclosure of an expanded list of items, including material modifications to security-holders' rights. Although this disclosure wouldn't stop companies from doing all they can to limit shareowners' rights, it would ensure that shareowners are fully aware of these activities.
The Council's policy does not contain any triggers. We believe a long-term shareowner or group of shareowners owning a significant stake in a company should have the ability to act like an owner and participate meaningfully in the director nomination process without facing numerous hurdles.
As a result, the Council believes that an access mechanism should allow for immediate activation of the process, at least in certain circumstances, since a two-year delay may be unfeasible for failing companies or other firms with significant governance problems.
However, if the final rules include triggers, the Council supports a Jan. 1, 2004, start date for triggering events. Shareowners have been waiting for this reform for more 60 years-it's time to move ahead with this important rule.
a. Withhold Votes
The 35 percent withhold vote trigger is high relative to the 20 percent yardstick used by investors and corporations to measure the significance of a withhold vote.
The "just vote no" strategy was first suggested more than 10 years ago by Joseph Grundfest, a former SEC Commissioner. In his keynote speech at the Council's fall 1990 meeting, he argued that a large "no" vote would signal that shareowners were seriously disaffected.
Bruce Atwater, then chairman and CEO of General Mills and chairman of the Business Roundtable's corporate governance task force, told an Oct. 17 1991, hearing of the Senate Banking Committee's Subcommittee on Securities, "If 20 percent of the votes of the given company for the board were withheld...it would be an open indication to all kinds of people that the board was vulnerable to an effort to mount an alternative slate."
The corporate and investor communities have long held that significant withhold votes are a meaningful signal of investor discontent, and a 20 percent withhold vote is clearly a significant show of discontent.
The Council's random survey of 2003 director votes at 100 S&P 500 firms, 100 S&P MidCap 400 companies, and 108 S&P SmallCap companies found only six companies (two S&P Midcap, four S&P SmallCap and no large cap companies)-2 percent of the entire survey group-reporting that at least one director received withhold votes of more than 35 percent of the votes cast. The Council would be pleased to forward this data to you.
Lowering the withhold vote threshold to 20 percent would increase the number of companies triggering the hurdle to 48-just under 16 percent of the sample. In both cases, the result is a modest number of companies that could potentially be eligible for the access mechanism.
The Council strongly believes that a withhold vote trigger should be based on votes cast, not votes outstanding. Companies and investors have historically evaluated the significance of director votes based on votes cast-not votes outstanding. The Council continues to believe that all vote tallies-including ones for director-should exclude broker votes. Automatic Data Processing reports that broker votes are always cast for management, which skews final vote tallies in favor of management-sanctioned candidates and management-recommended positions.
Requiring a vote based on outstanding shares would render the rule nearly meaningless for investors. If the hurdle is raised to 35 percent of the outstanding shares, only three companies-1 percent of the entire survey-would qualify. The difference is significant, and the Council believes the higher threshold would inappropriately hamstring shareowners and materially harm the effectiveness of the rule.
Of note, since inclusion of a shareowner-suggested director on management's proxy card results in a contest for board seats, broker votes should be prohibited in these situations. The Council encourages the SEC to work with the New York Stock Exchange to ensure that the stock exchange amends its rules to appropriately categorize access elections as "contests" not eligible for broker votes.
b. Shareowner Resolutions
The Council believes the current 14-8 rules-including ownership documentation, submission and resubmission requirements-should apply to all shareowner resolutions, including ones to activate the access mechanism. Requiring sponsors of access resolutions to own at least 1 percent of the stock unnecessarily complicates the rule and may adversely impact the effectiveness of the procedure.
When it comes to proposals-whether sponsored by management or shareowners-the primary issue is and should be whether the resolution wins support of a majority of the votes. A proponent's ownership level is irrelevant.
Concerns that lowering the ownership requirements for such proposals would open the floodgates and result in hundreds of resolutions are exaggerated. Once such a triggering event would be satisfied, a shareowner candidate may only be placed on management's card by a shareowner or group of shareowners holding at least 5 percent of the shares. And shareowner-suggested candidates will only end up on the board if they win the necessary support.
The Council strongly believes that a minimum of 50 percent of the votes cast for and against is the appropriate standard for determining whether a direct access shareholder proposal "passed" and activated the triggering event. Most management proposals, including the election of directors, equity compensation plans and other compensation plans, only need approval of a majority of votes cast. A higher standard for shareowner resolutions is inappropriate and unfair to shareowners.
c. Other Triggers
The Council believes that the failure to adopt or to take steps necessary to adopt actions recommended by a winning shareholder resolution is significant evidence that the proxy process has been ineffective. As a result, we believe such a trigger is appropriate and should be incorporated in the final rule.
A majority-vote trigger should be effective regardless of who sponsored the resolution, how many shares were owned by the proponent or the topic of the resolution. The issue here is whether a shareholder-suggested action wins support of a majority of the votes cast for and against. The proponent's name and stock ownership is irrelevant.
The Council strongly believes that using votes cast for and against is the appropriate measure for all shareowner resolutions. Basing the votes on outstanding shares is inappropriate and unfair to shareowners, since most management proposals, including the election of directors, equity compensation plans and other compensation plans, require only the approval of a majority of votes cast.
Companies should be required to file an Exchange Act Form 8-K stating any determination by a board of directors as to whether or not a majority-vote-winning security holder proposal, including one to trigger the access rule, has been implemented. For those isolated instances when companies and shareowners disagree over whether a resolution was implemented, a mechanism similar to the no-action process should be in place at the SEC for shareowners to contest such determinations.
The Council also urges the Commission to consider requiring companies to file Form 8-Ks promptly following the annual meetings to detail the vote totals on each item presented at the annual meeting. It is not uncommon for shareowners to wait more than six months to discover the voting results of annual meetings. Such a delay is unwarranted and unnecessary.
The Council asks the Commission to clarify and update the disclosure requirements for vote tallies. Some companies currently only disclose whether an item passed or failed. Such limited information is inadequate. Companies should be required to follow a consistent tabular format detailing votes for, against, withheld, abstained and broker votes. When broker votes are permitted on "routine" items, the voting detail should separately break out broker votes and detail how those votes were cast.
d. Consequences of Triggers
It's impossible to predict the consequences of the adoption of an access mechanism. However, it's important to note that Council members have a fiduciary duty to act in the best interests of plan participants and beneficiaries. As a result, they do not take actions-whether withholding votes from directors, supporting shareowner resolutions or suggesting director candidates-on a whim.
Such care is reflected by the results of a survey of public pension systems conducted by Lussier, Gregor, Vienna & Associates on behalf of the American Federation of State, County and Municipal Employees. According to the study, the top three significant reasons why public funds currently withhold votes from corporate directors are: (1) excessive absenteeism, (2) failure to implement shareholder resolutions receiving majority votes, (3) lack of independence or concerns with potential conflicts of interest.
The results are consistent with the Council's informal review of the proxy voting policies of 15 pension funds and investment managers. Specific guidelines varied widely, and reasons for withholding votes from directors included:
The Council is aware of concerns that the access mechanism may have the unintentional consequence of increasing the power of Institutional Shareholder Services, a proxy advisory firm. We believe such concern is misplaced for several reasons.
Of note, the Council does not believe that the commencement of a proxy contest should halt the access mechanism once legitimately triggered. Such a restriction would overly complicate the rule and be unnecessary, since both the access mechanism and a proxy contest reflect dissatisfaction with a board.
Notice of Triggering Event(s)
Too often, important disclosures get lost in the larger 10-Q or 10-K filings. To ensure that shareowners don't have to sift through hundreds of pages of filings to find the relevant disclosure, the Council believes such disclosure should be consistently tagged/identified by all companies so that investors can readily locate the information. Notice of triggering events should also be posted on company websites.
Eligible Nominating Shareholders
The Council supports the proposed eligibility standards. While individual Council members have different preferred ownership levels, with several advocating a 3 percent level, Council policy holds that the access mechanism should be available to any long-term shareowner or group of shareowners owning in aggregate at least 5 percent of a company's voting stock for at least three years. Since the Council policy is not intended to facilitate corporate takeovers, the Council agrees that the access mechanism should not be available to Schedule 13D filers.
Shareowners should be permitted to aggregate their holdings in order to meet the ownership requirements. The proposed two-year holding requirement should apply to all shareowners of any "group" formed for purposes of the access mechanism.
While SEC data suggests that about 42 percent of all filers have at least one shareowner satisfying this standard, the Council's experience is that in most cases these 5-percent shareowners are not actively involved in governance activities. Large owners most likely vote their shares, but they tend to not be involved in more assertive activities, such as filing shareowner resolutions or suggesting candidates for director. As a result, prohibiting shareowners from aggregating their holdings in order to satisfy the 5 percent ownership threshold would render this reform meaningless.
It's important to stress that reaching a 5 percent ownership threshold will be no easy feat. According to a recent Conference Board report on institutional investor investments, U.S. institutional investors, which are more likely than individual investors to use an access mechanism, controlled 55.8 percent of the U.S. equity market at the end of 2001. Institutional ownership was higher-61.4 percent on aggregate-at the nation's largest 1,000 companies.
But institutional investors are not a monolithic block-they are very different in terms of their investment philosophies, the influences they are subject to and the roles they may or may not play in corporate governance. In terms of corporate governance efforts, the most active institutional investors have tended to be public pension funds, which in aggregate own only 8 percent of total U.S. equity market.
The Council expects that other institutional investors such as corporate pension funds, mutual funds, insurance companies, bank trust departments-which in aggregate own about 40 percent of U.S. equities, are unlikely to use the mechanism.
The data is solid evidence proof that the 5 percent ownership threshold is a significant hurdle that in most cases will only be satisfied if investors are permitted to combine holdings.
Nominee Independence and Other Standards
The Council agrees that shareowner-suggested candidates should qualify as independent under relevant non-subjective stock exchange listing standards and that nominating shareowners or groups should be required to disclose all relationships between the candidate, the company and the nominating shareowners. The Council also agrees that nominating shareowners should be required to represent that they don't have any direct or indirect agreements with the companies and that their candidates qualify as independent under the relevant stock exchange standards.
However, requiring candidates to comply with state laws may be necessary but also problematic, if, as discussed earlier, states adopt laws giving companies flexibility to block or otherwise impose hurdles applicable to shareowner-nominated candidates.
To ensure that shareowners understand the definitions and requirements used by each company, the Council suggests that the SEC require companies to provide proxy statement disclosure of independence and other qualifications for shareowner candidates.
While the Council agrees that shareowner-nominated candidates should satisfy certain independence requirements, the Council strongly disagrees that candidates should have to be independent of the nominating shareowner or group.
The Council is puzzled why a shareholder-suggested candidate should be held to a different standard than board-nominated candidates. Corporate boards are currently free to nominate candidates with a range of special interests, such as individuals from firms that provide investment banking, legal and other professional services, relatives of company executives and directors and other individuals with various links to the company and its executives. It's unclear to the Council why significant shareowners cannot nominate employees, service providers or other "non-independent" candidates.
Corporate concerns over "special interest" representation are exaggerated, since candidates will ultimately only be added to the board if the shareowners-the directors' bosses-vote to do so. Once shareowners have full information about relationships between all nominees-including board-nominated and shareowner-nominated candidates-they can make a reasoned and informed voting decision.
To ensure that shareowners have access to sufficient information to assess each director's independence, the SEC should require enhanced disclosure of relationships between directors, corporations, corporate executives and, if appropriate, nominating shareowners. Current disclosures are weak, and too often shareholders learn of ties between directors when it's been too late, with a company mired in a scandal and director independence called into question. We urge the Commission to act on the Council's rulemaking petition on this issue submitted in October 1997 and amended and resubmitted in October 1998.
The Council does not believe a candidate should be subject to resubmission requirements. Similar resubmission requirements aren't applicable to management's candidates, so they shouldn't apply to candidates suggested by shareowners.
Limit on Shareowner Candidates
Council members approved the Council's policy with the understanding that an access mechanism should not be structured to permit a shareowner or group to unseat an entire board or facilitate a change in control.
The Council policy advocates that the access mechanism be used to nominate less than a majority of the directors. Numeric limits such as the one proposed by the SEC overly complicate the rule and may also impair the effectiveness of the access mechanism, particularly when shareowners are restricted to including only one candidate on management's proxy card.
The Council is aware of too many situations where a lone "dissident" director faced a hostile board, was blackballed from key committees and was effectively cut out of key discussions. From a practical standpoint, giving shareowners the opportunity to nominate at least two candidates would improve the possibility that "dissident" directors might have one director willing to second their motions.
The Council is concerned that giving companies until 30 days before annual meetings to notify nominating shareowners of determinations to omit shareowner-suggested candidates would not give shareowners adequate time to contest a determination and cure a defective notice. Such a short time period also does not provide adequate time for the SEC to address any disputes regarding director determinations-a mechanism which the Council believes should be incorporated in the final rule.
Giving companies too much latitude to request additional information to determine the eligibility of shareowner is problematic. The Council is concerned that some companies-unfortunately and ironically, usually the ones most in need of governance reforms-may spend countless hours and devote significant resources to "nit-picking" candidates and harassing nominating shareowners.
The final rule should be written to ensure that required disclosures include all necessary information, so that additional company inquiries should be minimal. If companies need to obtain additional information, such ability should be restricted to a very short period of time, and shareowners should be given a reasonable amount of time to respond to legitimate requests and to cure defective notices.
The final rule should include an SEC-handled mechanism to mediate shareowner concerns that companies are overstepping their rights to request additional information or to review shareowner objections of decisions to exclude shareowner candidates from management's proxy card. Without such an SEC mechanism, shareowners will be forced to undertake expensive litigation that would effectively render the access mechanism useless.
Proxy Statement Disclosure
The Council's access policy calls for company proxy materials and related mailings to provide equal space and equal treatment of nominations presented by qualifying investors. As a result, we believe shareowners should be permitted to include supporting statements regardless of whether companies include supporting/opposing statements.
At a minimum, a supporting statement of at least 500 words should be permitted. If companies devote more than 500 words to supporting their candidates or opposing shareowners' candidates, shareowners should be given equal space.
The final rule should prohibit companies from grouping management candidates to allow shareowners to vote for the entire slate. In contested elections such as ones resulting from the use of an access mechanism, shareowners should have separate votes on each candidate.
13-G Filing Requirement
The Council agrees that any Schedule 13D filers should not be eligible to use the access mechanism and that use of the access option should not result in the loss of 13G filing status.
The Council also agrees that shareowners participating in 5 percent groups should be required to sign a group Schedule 13G indicating ownership and intent to nominate candidates.
Regarding current rules and "vote no" campaigns, the Council has long called on the SEC to amend the rules to clarify that the 13D regulatory scheme is intended to only capture shareholders or groups of shareholders who intend to change or modify control of a public company, either through a tender offer or a proxy contest for board control. Specifically, the Council advocates establishing a safe harbor for the following activities: "short slate" campaigns that do not constitute a majority of the board and "just vote no" efforts in which shareholders urge other shareholders to simply withhold votes from directors.
While the 1992 rule changes, endorsed by the Council, relaxed the communications rules for situations when shareholders are not seeking proxy authority or are not attempting to change or influence the control of the company, they failed to provide concurrent 13D relief for many of these situations. This failure has created some gray legal areas that have hampered the full effectiveness of the intent of the 1992 rule changes.
National Association of State Retirement Administrators
David G. Bronner, CEO
Melanie Millhorn, Director
James D. Grisso, Executive Director
Paul Matson, Director
Gail H. Stone, Executive Director
Larry Dickerson, Executive Secretary
Fred R. Buenrostro, Jr., Chief Executive Officer
Jack Ehnes, Chief Executive Officer
Meredith Williams, Executive Director
Steven Weinberger, Director
David C. Craik, Pension Administrator
Betty Ann Kane, Executive Director
Sarabeth Snuggs, Interim State Retirement Director
Cecelia Corbin Hunter, Executive Director
Jeffrey Ezell, Executive Director
Wilfred Aflague, Interim Director
David Shimabukuro, Administrator
Alan H. Winkle, Executive Director
Bob Knox, Executive Secretary
Louis Kosiba, Executive Director
Jon Bauman, Executive Director
Craig Hartzer, Executive Director
William Christopher, Executive Director
Donna Mueller, Chief Executive Officer
Glenn Deck, Executive Director
William P. Hanes, Esq., Executive Director
Gary Harbin, Executive Secretary
Robert L. Borden, Executive Director
Bonita "Bonnie" Brown, Executive Director
Kay R.H. Evans, Executive Director
Thomas Lee, Executive Director
Nicola "Nick" Favorito, Executive Director
Joan Schloss, Executive Director
Chris DeRose, Director
Anne Wagner, Chief Executive Officer
David Bergstrom, Executive Director
Mary Most Vanek, Executive Director
Gary Austin, Executive Director
Frank Ready, Executive Director
Gary Findlay, Executive Director
William R. (BILL) Schwartz, Executive Secretary
Norm Robinson, Executive Director
M. Steve Yoakum, Executive Director
Mike O'Connor, Executive Director
Anna J. Sullivan, Executive Director
Dana Bilyeu, Executive Officer
Eric Henry, Executive Director
Frederick J. Beaver, Director
Terry Slattery, Executive Director
Laura Anglin, Deputy Comptroller
George M. Philip, Executive Director
Michael Williamson, Director
J. Sparb Collins, Executive Director
Laurie Fiori Hacking, Executive Director
Thomas R. Anderson, Executive Director
Thomas Spencer, Executive Director
Laurie Warner, Acting Executive Director
John Brosius, Executive Director
Marisol Marchand, Administrator
Frank J. Karpinski, Executive Director
Peggy G. Boykin, Executive Director
Rob Wylie, Administrator
Ed Hennessee, Director
Sheila W. Beckett, Executive Director
Gary Anderson, Executive Director
Ray Henry, Director
Ronnie Jung, Interim Executive Director
Robert Newman, Executive Director
Cynthia L. Webster, Director
Laurence E. Bryan, Administrator
W. Forrest Matthews, Jr., Director
John Charles, Director
Joseph Jankowski, Executive Director
Eric Stanchfield, Secretary
Thomas Mann, Director
National Council on Teacher Retirement
The National Council on Teacher Retirement (NCTR) is constituted as an independent association dedicated to safeguarding the integrity of public retirement systems in the United States and its territories to which teachers belong and to promoting the rights and benefits of the members, present or future, of the systems. NCTR had its beginnings in 1924, affiliated with the National Education Association in 1937, and became an independent association in 1971. The Council is constituted as a nonprofit tax-exempt entity under Section 501 (c) (6) of the Internal Revenue Code.
NCTR membership includes 77 state, territorial, local, and university pension systems. These systems serve more than 16 million active and retired teachers, non-teaching personnel, and other public employees, and have combined assets of more than $1.4 trillion in their trust funds.
COUNCIL OF INSTITUTIONAL INVESTORS
AFL-CIO Staff Retirement Plan
New York City Board of Education Retirement System
New York City Fire Department Pension Fund
New York City Police Pension Fund
New York City Teachers' Retirement System
New York State and Local Retirement Systems
New York State Teachers' Retirement System
North Carolina Retirement System
Noyes Foundation, Jessie Smith
Ohio Police and Fire Pension Fund
Ohio, Public Employees Retirement System
Ohio, School Employees Retirement System
Ohio, State Teachers' Retirement System
Oklahoma Teachers' Retirement System
Operating Engineers, Central Pension Fund
Pennsylvania State Employees' Retirement System
Pfizer Retirement Annuity Plan
Philadelphia Municipal Pension Retirement Fund
Pitney Bowes Pension Plan
Plumbers & Pipefitters National Pension Fund
RadioShack 401k Plan
Rhode Island Employees' Retirement System
Sacramento County Employees' Retirement System
San Bernardino County Employees' Retirement Association
San Diego City Employees' Retirement System
San Diego County Employees Retirement Association
San Diego Hotel & Restaurant Employees Health & Pension Fund
San Francisco City and County Employees' Retirement System
Schering-Plough Employees' Savings Plan
Sealed Air Retirement Plans
Service Employees International Union Pension Fund
Sheet Metal Workers' Local 19 Pension Plan
Sheet Metal Workers' National Pension Fund
Target Pension Fund
Teamster Affiliates Pension Plan
Tennessee Consolidated Retirement System
Texas, Employees Retirement System
Texas Municipal Retirement System
Texas, Teacher Retirement System
U.A. Local Union Officers and Employees Pension Fund
UNITE Laundry & Dry Cleaning Workers Pension Fund
UNITE National Cotton Retirement Fund
UNITE Textile Workers Pension Fund
United Food and Commercial Workers International Union Staff Trust Fund
United States Steel and Carnegie Pension Fund
Unocal Retirement Plan
Virginia Retirement System
Washington State Investment Board
West Virginia Investment Management Board
Wisconsin Investment Board
World Bank Staff Retirement Plan
HONORARY INTERNATIONAL PARTICIPANTS
Alecta Investment Management
Davis Polk & Wardwell