Alabama

Alabama has three main public pension systems: the Teachers’ Retirement System (TRS), the Employees’ Retirement System (ERS), and the Judicial Retirement Fund (JRF). These pension systems are overseen by the Retirement Systems of Alabama (RSA).

• The TRS/PEEHIP board represents public education employees and consists of 15 members: 3 Ex Officio (State Superintendent, State Treasurer, State Finance Director); 12 members must be retired or current public education employees elected by public pensioners.
• The ERS/JRF board represents all other eligible state employees and consists of 15 members: 4 Ex Officio (Governor, State Treasurer, State Finance Director, State Personnel Director); 3 appointed by the Governor; 8 members elected by public pensioners.

According to its 2022 Annual Comprehensive Financial Report, the RSA’s investment consultant is Regions Bank.

The RSA does not publish its proxy voting records and does not contract with outside investment managers. Therefore, no data concerning the proxy voting of Alabama’s public retirement funds could be published for the state whether through directly held equities or externally managed investments. Alabama is the only state that does not publish any of this information. In response to a Freedom of Information Act (FOIA) request, RSA claimed it does not possess its proxy voting data, past or present.

Regarding asset managers, Alabama statute requires the RSA to contract with an Alabama bank as its investment advisor. The state of Alabama currently contracts with Regions Bank for these services. Regarding proxy advisory services, Alabama has historically contracted Glass Lewis as its proxy advisor. However, it does not currently contract with a proxy advisory firm. RSA likely uses custom guidelines through the ProxyEdge service offered through BroadRidge.

1792 Exchange encourages RSA to publish its proxy voting records and proxy voting guidelines instead of keeping pensioners in the dark about how the state votes on ESG issues with their money.

Correction

An issue was corrected after the initial release of the Proxy database in 2023, when RSA denied that State Street invests equities or casts proxy votes for the State. RSA’s public records list State Street as a custodial bank and a fund manager. No other investment managers are named in RSA public records, which is what is what was initially reported in the Proxy Database.

RSA also claimed its stake in companies was insignificant and did not merit hiring additional staff to study proxy proposals such as California. However, RSA could design or adopt pro-fiduciary guidelines for its proxy voting.