NYC Comptroller Levine Reviews Pension Policies, Focuses on Housing

New Comptroller Mark Levine Reviews Pension Strategies with Climate Focus

With an eye on climate goals and financial stewardship, New York City’s newly elected comptroller, Mark Levine, is carefully considering recommendations to divest from major financial firms. His review comes in response to calls from the former comptroller, Brad Lander, to withdraw pension mandates from BlackRock and Fidelity Investments.

During an exclusive discussion with Responsible Investor, Levine expressed the seriousness with which his office is evaluating prior recommendations. "We are deep in review of everything he recommended and I take our climate goals very seriously," Levine stated, adding that maintaining high standards for fund managers is a priority.

Brad Lander, Levine’s predecessor, had suggested late last year that three of NYC’s five pension systems should consider dropping BlackRock, Fidelity Investments, and PanAgora Asset Management due to inadequate decarbonization and stewardship plans. Notably, PanAgora managed to remain on the list by resubmitting an improved plan, but decisions on BlackRock and Fidelity were left unvoted by trustees as Lander's term ended.

Continued Activism in Shareholder Advocacy

Under previous leadership, NYC pension systems have been vocal in shareholder advocacy, addressing issues ranging from corporate environmental policies to workers' rights. Levine intends to sustain this level of involvement. "We are going to be activist. We continue to care about climate and housing and transparency and more," he confirmed to RI.

Amid ongoing regulatory hurdles in the US regarding shareholder proposals, Levine is open to exploring alternative approaches, including vote-no campaigns against board directors and strategic lawsuits.

Focus on Affordable Housing

A prominent theme in Levine's campaign was addressing New York City’s affordable housing crisis. While committing to his primary role as fiduciary for the pension system, Levine sees potential for pension funds to aid in this challenge by financing housing projects that might otherwise be financially unviable.

The pension systems’ current asset allocation strategy allows for up to 2% in "economically targeted investments"—initiatives aimed at bolstering the local economy while adhering to risk-return standards. Levine hopes to elevate this allocation from its current 1%, prioritizing affordable housing investments.

“I’d like to make affordable housing the top priority in those additional investments,” he noted, indicating early discussions with trustees about this focus. The office is poised to conduct a strategic asset review soon, presenting opportunities to explore housing and climate-focused investments further.

From President to Comptroller

Levine's journey from Chicago to New York's financial helm includes experience as a teacher and founding a co-operatively owned credit union. His path included a term as a city council member and Manhattan borough president before his current role as comptroller.

“In a sense, a job I’ve been preparing for my entire life,” Levine shared with RI, citing the foundational understanding of finance and economics from his credit union experience.

Highlighting his ambitious plans, Levine aims to modernize city government. Noting outdated processes such as the use of fax machines, he emphasizes improving services and efficiency for citizens and taxpayers alike.