A recent article in the Wall Street Journal notes the apparent conflict of public pension fund investments in private equity. The article points to the fact that certain labor unions, including the Service Employees International Union (SEIU), have criticized private equity funds while their members sit on boards which authorize investments in such funds. A specific example citied is the Ohio Public Employees Retirement System, which includes a representative of SEIU among its Board members, having increased its targeted private equity holdings. The article goes on to point out TV spots funded by the American Federation of State, County and Municipal Employees (AFSCME) which criticize Republican presidential candidate Mitt Romney regarding his tenure at Bain Consulting.
Timing is everything. In deciding to launch a blog specifically geared to the public fund fiduciary, we knew there was a broad landscape of legal issues that are now gaining wide scale attention. We intend to touch on many of these issues in subsequent installments. Hopefully, we will have the opportunity to drill down on major issues that are of importance to our clients and readers. Of the many issues that could serve as the first entry, we prepared discussions on two that seemed equally urgent: the fiduciary duty to protect pension records requested under “right to know” laws and the potential impact of bankruptcy filings of local governmental plans. With yesterday’s bankruptcy filing by the city of Harrisburg, Pennsylvania, the decision has been made for us. We value your time and hope you find this discussion, and those that follow, to be worthwhile.