The California State Teachers’ Retirement System (“CalSTRS”), America’s second largest pension fund, announced that it would vote its nearly six million shares against the retention of Wal-Mart’s board of directors. This decision comes in the wake of Wal-Mart’s ongoing Mexican bribery scandal.
This is an important story for pension governance and fiduciary responsibility. Entirely too often, the discussion about pension investment is focused on inaction.
CalSTRS has not fallen into this trap. It has pursued legal action over alleged failures in corporate governance and now it will vote its against the board. These are proactive steps made to protect the fund’s investment and its investors, the teachers of the State of California.