The College Retirement Equities Fund can ignore a controversial customer proposal calling for it to end investments in companies that support “Israel’s occupation,” the U.S. Securities and Exchange Commission has ruled.
In a May 10 letter and a follow-up reconsideration letter, the SEC said it would take “no action” against CREF for declining to put the proposal in its proxy documents because it approved a move by CREF to bypass a similar proposal two years ago.
CREF successfully argued in 2011 to the SEC that an advisory vote on its human rights and social policies was unnecessary because it was already addressing the issues. The firm is the SEC-registered investment unit of TIAA-CREF, which oversees some $520 billion in retirement plans, annuities, life insurance and other products for 3.9 million teachers and employees of nonprofit companies.
The author of the disinvestment proposal, Steve Tamari, an assistant history professor at Southern Illinois University’s Edwardsville campus, did not return calls seeking comment.
In an earlier letter to the SEC’s division of investment management, he had argued that there were “vast” differences between the new and older proposals, including no mention of lands Israel is allegedly occupying and no specific deadlines for divestment in the current one.
While requests by corporations to exclude shareholder proposals from their proxy voting materials are relatively common, they are less so for nonpublic fund companies.
Deborah Skeens, the SEC lawyer who signed the no-action letter, declined to comment on whether similar proposals have been made at other financial services companies.
A spokesman at TIAA-CREF, which is holding its annual meeting on July 16, declined comment on the no-action letter.
CREF has also received approval to omit a participant proposal calling for its Social Choice fund to divest investments in all health insurance companies, the spokesman said. There are no participant proposals that will be included in the company’s soon-to-be submitted proxy, he added.
Tamari submitted the proposal on behalf of a group called WeDivest that is primarily composed of academics.
In a press release on April 24, selected faculty members of Barnard College and Columbia University said that though TIAA-CREF “prides itself on socially responsible investment” it invests in five companies that “actively engaged in supporting human rights abuses” by Israel.