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New Mexico financial trustees weigh social responsibility

June 23, 2021 GMT

SANTA FE, N.M. (AP) — Custodians of New Mexico’s two multibillion-dollar financial trusts that underwrite public education and infrastructure spending are weighing whether to giver greater weight to issues of social responsibility and sustainability in investment decisions.

The State Investment Council headed by Democratic Gov. Michelle Lujan Grisham on Tuesday kicked off deliberations about its investment strategies and a possible policy change to give greater consideration to a host of environmental, societal and governance concerns, from climate change to issues of racial injustice.

The conversation takes place as giant asset manager BlackRock has placed greater emphasis on the risks and rewards of environmental, social and governance issues, sometimes challenging the direction of company executives.

Investment council members including State Treasurer Tim Eichenberg and Catherine Allen indicated support for giving greater consideration to social responsibility and sustainability issues.

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“It’s appropriate risk management for us to be taking this into consideration,” Allen said.

Council member Leonard Lee Rawson of Las Cruces said he would prefer that the Legislature decide whether to explicitly incorporate social responsibility into the council’s investment considerations.

He cautioned the council against activism on lightning-rod issues such as climate change when evaluating investment risks and opportunities.

Lujan Grisham and State Land Commissioner Stephanie Garcia Richard, the council vice chairwoman, were absent from the discussion Tuesday. No formal action was taken, with further debate scheduled for a meeting in August.

The State Investment Council last year adopted a strategic plan for renewable energy that allows investments in New Mexico solar and wind projects to offset other energy investments including fossil fuel activities. The plan was promoted by a Democratic-sponsored state House memorial in 2020.

The council oversees the state Land Grant Permanent Fund and Severance Tax Permanent Fund, with combined assets of roughly $29.5 billion as of May 31.