Lawmaker: Let Feds Invest TSP Savings in Companies With Female Leadership
4:29 PM ET
Federal employees and retirees should have the opportunity to invest in women business leaders, according to a Democratic lawmaker.
That is why Rep. Don Beyer, D-Va., introduced the Gender Diversity Investment Act, which would create a new Thrift Savings Plan fund invested in companies "that demonstrate a strong commitment to gender diversity and women's economic empowerment." Beyer said the bill would not cost anything -- though the Federal Retirement Thrift Investment Board would have to create or contract out a new investment index -- and would encourage businesses to put more women in leadership.
"This legislation would provide federal workers the opportunity to invest their retirement savings in companies that have made a commitment to gender diversity at the highest levels," Beyer said during a press conference Tuesday to unveil the bill. "It makes good business sense. Studies show companies that have women in leadership outperform companies that do not."
He added the fund would create an opportunity for feds to speak their minds through their investments.
"Let's allow federal workers to vote with their retirement savings," Beyer said. "The studies are clear: companies should invest in women in leadership; if they don't, then federal workers can choose to invest in companies that do."
Beyer pointed to a study from Catalyst showing just 20 percent of board seats on U.S. companies on the Standard & Poor's index were filled by women as evidence they are underrepresented at the top levels of the private sector.
After announcing the bill, Beyer held the first ever meeting of the Executive Women's Council, which he created to have female board members at medium and large publicly traded companies inform his decision making on economic policy. The group discussed the scarcity of women on executive boards across the country.
This is not the first time lawmakers have attempted to use the TSP for compassionate investing; in April, Democrats in the House and Senate introduced a measure to create a "corporate responsibility index," allowing TSP participants to invest in companies with "sound environmental, social and governance practices." The lawmakers pushed similar legislation in the last Congress, but the bills never moved out of committee.
"Americans increasingly want to invest in companies whose policies align with their personal principles," said Sen. Sheldon Whitehouse, D-R.I. "This legislation will allow millions of federal employees and retirees to choose how their money is invested, providing them with the freedom to use the power of their individual purse to tell big polluters they can't keep dumping carbon pollution into our atmosphere and oceans without consequences."
In 2012, however, the Government Accountability Office found such a fund may not be wise for the TSP. GAO did not find any potential long-term benefits from the addition of a SRI, saying the fund would overlap with existing investments and therefore not diversify the portfolio. FRTIB had requested the study of how a socially responsible index would affect the plan.
For those reasons, FRTIB spokeswoman Kim Weaver said the board does not support adding a standalone fund targeted at gender diversity or corporate responsibility. The board has also said there is very little demand among participants for the SRI option.
4:29 PM ET
Lawmaker: Let Feds Invest TSP Savings in Companies With Female Leadership
Posted by: sarah_oz@yahoo.com
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