Raising the Bar

STRATEGIC PARTNERSHIPS

The Treasurer’s Office gains immense value working in partnership with coalitions, corporate governance experts, and other investors. Partnerships help us pursue learning opportunities, advance leading investment practices, and ultimately be better fiduciaries seeking to protect assets and maximize returns. That’s why we are active members of several major investor networks, including those featured below, which are made up of leading asset management firms, public pension funds, labor funds, foundations, endowments, family offices, and other state treasurers.

GOING FURTHER

We believe more is accomplished when you take a proactive, multifaceted, networked approach toward addressing environmental, social capital, human capital, business model and innovation, and leadership and governance issues.  That’s why in addition to company-specific engagements and campaigns, the Treasurer’s Office participates in advocacy organizations and promotes sustainability across its areas of influence.

INCLUSION

• Creating More Opportunities for Minorities, Women, Veterans, and Disabled-Owned (“MWVD”) Businesses – Inclusion is a key pillar of the Treasurer's approach to investing.  Research demonstrates that MWVD-owned companies are often well-situated to ascertain capital inefficiencies in the market, and as such, many are primed to outperform their peers.  Treasurer Frerichs and his team have transformed the culture, policies, and operations of the Treasury to enhance opportunities available to MWVD individuals and business partners.  Since Treasurer Frerichs came into office, the Treasury has increased utilization of MWVD broker/dealers from 1% to 63%.  Put another way, in FY 2014, total assets brokered with MWVD firms was $603 million.  In FY 2017, total assets brokered with MWVD firms was $24 billion.  That represents a 40-fold increase.  

• Advocating for Corporate Board Diversity – The Treasurer’s Office believes that corporate board diversity is a critical dimension of effective board composition and performance.  Diversity means including women, racial minorities and the LGBT community in the pool for board candidate selection.  As such, the Treasurer’s Office is taking a proactive approach to stop the status quo and help ensure board diversity is a corporate governance priority.  The Treasurer's Office is a member of the Midwest Investors' Diversity Initiative, a coalition of investors using their corporate relationships and shareholder rights to encourage boardroom change.  Treasurer Frerichs also joined other state and local leaders in urging corporate board diversity by signing a Joint Statement on Corporate Board Diversity in June 2016.

• Advocating for Gender Diversity on Corporate Boards – The Treasurer's Office is a proud member of the Thirty Percent Coalition.  This groundbreaking organization is committed to the goal of women, including women of color, holding more boardroom seats across public companies. Doing so leads to a greater return on the money we invest on behalf of the State of Illinois. Studies show that companies with gender diverse boards are 15 percent more likely to outperform the median in their industry.

• Increasing Inclusion in the Financial Services Industry – The Treasurer’s Office is a proud member of the Financial Services Pipeline Initiative, adding its voice and resources to a coalition of prominent financial institutions with a mission to (1) increase the representation of Latinos and African Americans, at all levels, within the Chicago area financial services industry, and (2) improve the overall cultural competency within the Chicago area financial services industry.  The Treasurer’s Office actively participates on the CEO Leadership Council and the Steering Committee to devise core strategies and develop action plans.

• Collaborating with the Rainbow PUSH Wall Street Project – The Treasurer’s Office is a steadfast supporter of the numerous efforts led by the Rainbow PUSH Wall Street Project.  The Wall Street Project is dedicated to ending the multi-billion dollar trade deficit with minority vendors and consumers by working to ensure equal opportunity for diverse employees, entrepreneurs, and consumers.

COMMUNITY REINVESTMENT

• Enforcing Community Reinvestment Act (CRA) Standards – The Treasurer’s Office wants to encourage an open and effective banking system that grows local communities and boosts Illinois’ economy.  By law, the Treasurer’s Office is authorized to consider a financial institution’s record and current level of financial commitment to its local community when deciding whether to deposit State funds in that financial institution.  Under Treasurer Frerichs, depository institutions are ineligible to do business with the Treasurer’s Office if they have a CRA rating below “satisfactory.”  To learn more about CRA priorities, please visit our Community Reinvestment Act page. 

• Utilizing Top-Rated Banking Debt Issuers – In line with the Treasurer's commitment to community development and accountability, all approved banking debt issuers that do business with the Treasurer’s Office maintain a Community Reinvestment Act (CRA) rating of "outstanding" or "satisfactory" (as of June 2016).

ENVIRONMENT

• Investing in Green Bonds – Investing in environmental-impact bonds not only results in positive societal impacts, it provides a strong investment return for the State of Illinois.  That's why the Treasurer's Office has invested $70 million in green bonds, proceeds which are used to fund investments in the productive use of renewable energy, sustainable forestry, energy efficiency, energy optimization, and the production of clean energy sources.
   
• Inclusion and Green Technology Goals under ILGIF – As a part of the Illinois Growth and Innovation Fund (ILGIF), the Treasurer’s Office seeks to support fund managers that have demonstrated experience and/or an express ability to invest in green technology businesses located in Illinois.  To learn more about ILGIF, please visit our Illinois Growth and Innovation Fund page.
   
• Calvert Equity Portfolio – Individuals and families using the Treasurer’s Bright Directions College Savings Program have the opportunity to invest in a mutual fund, Calvert Equity Portfolio, that is specially tailored to recognize sustainability factors.  Portfolio companies in this fund are judged by their sustainability performance.  And not only does this help promote responsible sustainability best practices, but this assessment helps inform risk and opportunity factors tied to enterprise value and investment performance.