Lawmakers are expected to introduce a bill in the coming days that would require the California Public Employees’ Retirement System and the California State Teachers’ Retirement System to divest of any Russian assets. The bill would also bar the state from awarding contracts to companies that do business with Russia.
The move comes less than a week after Russia invaded the sovereign territory of Ukraine and hinted that it would consider using nuclear weapons in a future confrontation with NATO.
The bill would contain an urgency provision that allows it to take effect immediately. Assemblyman Chad Mayes (I-Rancho Mirage) has openly called for divestment and says there’s bipartisan support in the Legislature.
"I’m in strong support of California divesting from Russian assets and financial institutions. It’s great to hear that there is broad bipartisan consensus in the legislature that we do just that. #StandingWithUkraine @CalPERS @CalSTRS," he tweeted Monday.
There’s less agreement on the CalPERS board. While California State Treasurer and board member Fiona Ma has thrown her support behind divestment, State Controller and board member Betty Yee hasn't gone that far yet.
Divestment from Russia would be a major move for California, which boasts the fifth largest economy in the world. CalPERS holds no Russian government debt. But it does have $900 million to $1.1 billion invested in publicly traded Russian companies, real estate, and private equity, according to spokeswoman Megan White. A public database shows CalSTRS’ held almost $32 million in Russian debt and $1.5 million in Russian rubles as of June 30.
“The database also shows that at the time [CalSTRS] held shares in companies such as Gazprom and Russian banks Sberbank and VTB — both sanctioned by the U.S — valued at roughly $800 million,” which accounts for less than 1% of CalSTRS assets, according to the Los Angeles Times.
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