people their comments are valid we're doing $100 million but in reality if we could get the worse coal companies in the things we think will not have great value in the future will be a good test a good part research to do that i know that people are doing that that's one and two maybe we also can target venture capital, private equity in renewables i know that funds are doing this they're successful granted they're not huge funds but i think it would be good to keep looking for that and you know it's hard for us we don't have a lot of money to put to work but i think we can find them if we put that to task. >> i think that is a great idea how about this

i can head on it and move it in a conducive way we have 7 investments 7 companies that fall under that category why not bring back a analysis of the shares of the 7 companies - that may come out of that, too i'm not sure but we have to start with the pool of who wore investing with and take a crack at brick the report back to the commission on how many shares we have and maybe rating them with some type of understanding of the worst of worst i'm going to suggest where to start so i'll look to staff for that and we'll start to look at it and make it a working document. >> since we can that's been done and foundations have done

that with a track record 350.org has information around that we can go to jeramy and ask they've been running the portfolio a while and see which ones he's taken out the portfolio. >> could we breakdown that into a separate direction we're under the staffs level 2 and direction from the worst e entrenches offenders and selling off is really a level 3 so maybe in the call of the order you can direct staff to do an evaluation to bring back to the board and modify level 3 based on the worst offenders keep this within the context of was the board psa

has approved and researching. >> researching into potential level 3 divest time. >> so is there let me would someone like to share an opposing view on that for a level 3. >> commissioner can we i just from an agenda prospective need to stay on the agenda which is the recommendation on the "x" fossil fuel fund so if the next item is the sf g that is an item to discuss this or the order of the agenda item. >> the executive director under our report. >> great okay. >> seeing any other comments or discussion on the motion before us? >> yeah.

commissioner driscoll. >> i have a research question in terms of camp mather including the coal copies sometimes those look like great opportunities but maybe a conflict we've to the adapted our policy those are companies we don't want to invest in i'm not trying to look at level 3 maybe not the answer today. >> exactly. >> commissioner meiberger. >> yeah. i want to you love metaphors if you put a met for in front of you the horse and the buggy i'm sure people got tired of stepping into the poop. >> i think the answer is renewables i think the answer is renewables i'll echo at this

time. >> do you have a motion before us. >> i'd like to offer a discussion i'm not opposed to this motion i think although people in the audience think i'm opposed to anything sf follows free sf but the progression we need to be smart and focused and there should never be a rush unless it's a sound like dignities i think this is a nice social statement but in terms of financial decisions i don't think this necessarily has a great impact a couple of things to think about from a social prospective it is nice it is good and i think this is important i believe in public transportation i believe in people producing carbon fingertip that being said what we're talking about st. is

somehow we're going to effect supply say that will effect demand and effects behavior with you have the population here and developing countries and number one develop countries i think there is compelling stories about the developing countries have more basic energy needs for example, we were devesting follows fuels we somehow would effect the supply of follows fuels you'll hurt african that have's problems with access energy and developing country side need coal and fossil fuel it feels good in the u.s. but we're needing to be know about other countries as well people talk about oil and how there's only a finite

supply that is true only so much oil and time after time there's been a shift in peak oil if you look it over the last several years and all of a sudden there's new technology that comes along and another way to extract oil the question to what's the cost to extract the oil and was the cost to extract that tracking etc. i mean is the cost to extract that greater than the cost of having it deployed to other countries this is something to think about as we continue to look at the architecture resources and that's a finite supply i don't know anyone in the room knows that everyone has been wrong so for so if we really want to change the world

we need to change the behavior not divest in follows fuels if you want people to stop using plastic bags you'll change the behavior that is renewable so i think that spending our time discussing the divestment of follows fuels we should be looking at renewables but something we have to keep in mind the reason follows fuels are important the price per kilowatt oil but as technology advances and it will alternatives will become important financially viable and when this happens you'll see a shift in behavior i think we should think along and hard about changing behavior and making renewables more assessable by technology and looking at funds that can have a

real impact and also, if there's a hand out of energy upstairs companies that are e depreciates violators there's risks associated that that it is professionally into their market price maybe it is not if we were more targeted instead of casting a wide net and throwing everyone you out i thought that was food for thought for the members of the public and the staff as we go to the progress with that i'll support it we need to be careful how we go about it >> all in favor, say i. >> i. >> opposed? >> in a. >> 6 to one thank you, everyone item number 5 5 an action item establish the

ad hoc governance committee and renew the appointments commissioner makras. >> the marshall board meeting the board establishes an ad hoc environmental and social and governance committee and commissioner makras that proposed that commissioner paskin-jordan serve as chair of the committee and he was going to name the committee members at the meeting today for the boards approval. >> great i'm happy to tell you that wendy has accepted chairing so i want to open it up to who has an interest in serving on the committee. >> i have a question. >> sure. >> i have an interest in a question (laughter). >> not just for myself but the members of the public maybe you can describe in detail exactly how and what this committee ask going to do and compliment the

work we're doing. >> go ahead jay. >> this is a project that staff has been looking for the last 3 to 5 years we have a resources a city hall fellow that's been working over the past few months and sort of coming to the board with a proposal to replace our current social investment policy with a holistic approach which will consider environmental social and governance issues at the time, we invest money before we invest money rather than focusing on trying to punish bad behavior after we've invested in an opportunity and so what we're hoping to do have a structured online of opportunities we want to present to this committee for the committee to consider so we can again take from the giving up to

end approach in recognizing those issues and the impact on the money we invest so we have a lot of materials ready to show the committee i don't know how long this will take but board members have expressed an interest. >> maybe those materials were not furnished many my binder. >> they're not all they'll come to the committee. >> i'll say that commissioner meiberger handed out at the last meeting his attempt to a basic u s g policy we have further materials for further consideration. >> jay will be consider the committee will look at the renewables. >> it will be across the entire portfolio and would impact

potentially the investment policy statement as well as i mean we've had discussions defining our values and i think this will fit in also with defining our values as relating to specific social and governance issues. >> commissioner stansbury. >> yeah. the question are there members of the commission that are serving i'll be happy to and as you think about who on the commission you want to assign to this committee i think what is important whatever we're going to do has an impact it needs to be going back no my previous comments we need to be focused and deliberately for lack of a better term there's low hanging fruit and we can make an impact and changes by going after the low hanging fruit we'll entertain a motion for the

chair and two people have expressed interest commissioner stansbury and . >> i want to express my interest i've been working on this and i've brought the original suggestion sew jay can we have a committee of 4. >> then everyone will serve that's my recommendation commissioner meiberger are commissioner stansbury commissioner paskin-jordan the chair will entertainer the motion for that oar i'll make that motion. >> i'll second it open up for public comment on 5. >> i've got cards (calling names). >> good afternoon, commissioners thank you for your supporting

support legislative active aid to supervisor avalos a few thoughts will shareholders engagement i appreciate the concerns expressed by the commissioners about the potential staff level two engagement and how much work it will take and distraction for i we fully support the stakeholder engagement as a step along the way but i think that didn't get to the real concerns about the risk of the portfolios of climate changes to our fossil fuel and i think that commissioner stansburys question was i know the results will be interesting how well were the relatives of the stakeholders issues and how much of a burden on the companies that result will show you that stakeholder engagement the behavior of the fossil fuel companies when we

come back to the scc rules that is creditor to the business model of a company you're not going to be able to get a fossil fuel company to adapt it proposal so the stakeholder engagement makes sense and part of the responsible investing in this case it makes sense when combined with a full divestment so it will ultimate protect the fund so that being said if you're going to engage with the fossil fuel companies it should be rigorous are a finest timeline with the goals of that engagement and get regular report backs and send letters to the companies and after the proxy season has it been effective and if not your fiduciary responsibilities to

the level 3 full divestment i want to submittal that to sf for an plan and send a letter to the fossil fuel companies that supervisor avalos shared with a few people for you all to look at it and hopefully, a discussion at the committee. >> thank you, jeremy. >> jetting followed by martha. >> thank you commissioner makras and members jed smith we are glad to see this committee being created i reminded you guys last month you passed the motion for an f g committee in 2014 i don't know procedurally if this vote was really needed but certainly, if there has been integrated g f

policy we all have been happier with the two year process we've engaged if i'm going to understand this e s g framework the committee will be forward-looking and not encompass the fossil fuel issue but it is positive and the comments the investment heard from the vefrdz last month to point to the importance of this inside the system i also agree that anything we do needs to have an impact that's why we were so frustrated by proxy votes so for a year which has been happening for decades no impact to the position we're another today equal oil is not the issue you're coming up against the limits of the climate what it

can stand awhile i'm not a financial expert i am an energy expert one that is considered by lengths so i think we have take into consideration the energy needs of the developing world and it is worth mentioning that world will have a catastrophic issue so we support of the formation that have committee and hope that will the level 2 implementation process in any future action that is taken an follows fuels likewise the worst of the worst we support as the track divestment we hope that place in the offices of the full board is that is what the tifltd and made available to the public largely when the ad hoc

committee will not we thank you very much for your support. >> thank you marketing followed before and after. >> martha hawthorne pensioner sciu 10 to within i support of the creation of this committee it is a good step forward i want to express on you, the urgency which our members have divestment we took it upon ourselves to come out in a strong recommendation you to do board to not only go to level it but ultimately divest i was happy to hear the report from calpers a couple months ago they've been engage for 10 years and nothing has really changed

i think many speakers have spoken to climate science how we know more and more it is worse and worse on behalf of members of the suv 10 to one get this committee going but the ultimate rule is divest no rule of result in changing it's practices we will be ni eve to think that. >> i think that was calendar was going to address the level two vote that happened last week, i was wondering where that stand and what's going to happen

next other thing i sort of wanted to mention was commissioner paskin-jordan comment about mr. jeremy grant with his foundation which we're essentially coal will have a part of many companies like a larger basket i have a feeling because of gm o relatively with the board will not respond to that inquire but we'll is i'll continually reiterate this is happening all over the world and institutions are continuing to address this issue with divestment and strong engagement policy what is happening with level 2 is there a timeline or goal we're expecting that at the meeting and i definitely stand behind

support the work of looking at the worst offends and moderating on something quickly and would again offer up the thinking of the many other constitution across the united states that are moving through this. >> great, thank you. >> patrick shaw move forward by some of the public testimony i think speaking in support of this motion and urge you to rapidly in this committee and possibility have the committee report back to the full board every month as a stated agenda item disturbed that you would slow down things the developing

countries almost it almost begs a different met for let the meat cake your worst offender mroshgdz i think the worst companies engaging you divest from them rapidly we have a drought in that state it takes an enormous amount of water it is reported to be causing earthquakes in smaller neighboring states i can't think of a better example of the worst offender need to divest from anybody that engaging in this

thank you. >> thank you. good afternoon. i'm with the series i just want to reiterate as i stated i think at the february board meeting last year that series and our investor assignment risks is ready to work with you all we're ready to work with the new committee excited to be seeing you know the progress that you've been making you know and ready to help you better understand you know the risks that climate change currently probation officers the financial risk is proposed and the future one and do those as the commissioner said this thoughtful analysis that has an impact i think you know the network comes with one hundred and 10 larger

constitutional investors managing millions of dollars in investment and work with investor of different types we want to make those resources as you're doing our due diligence there's things you've done you don't need to do again, we you know we want you to you know in any way to be supportive that we we're there but we're waiting to hear from you if indeed you do want this information and the support i think the other thing i'll mention there's been comments around engagement we launched the carbon asset initiative with several members of the investor network to offer and combeenl the fossil fuel companies on what they're doing on capital expenditures and the returns on

the capital and you know while it is true that the big issue is not being solved important things are getting done and the voice of a pension fund we can make a significant difference in company for example, like chevron that are here that are not doing much for climate change but spending million dollars and million dollars to not have 32 that helps california the second largest economy engagement and divest and the whole strategies can make a significant difference you know and gave me in solutions and getting rid of the investments in follows fuels that don't makes sense even now thank you.

>> go right ahead. >> i just want to reiterate the urgency of this and knowing two years in consideration i understand that investment boards don't tend to jump into things i really urge you to take into account if you really in this committee look at was is happening with climate change through the years and future it is happening right now and the drought it part of this and if you really look at what is going on the climate change and the dpak impact not only in california but around the world it is hitting the most vulnerable people first and open your hearts be human beings ♪ committee as well as fiduciaries and i really i trust that this will set a fire under what you're doing and thank you for

doing that >> thank you seeing no other speakers i'll close public comment all in favor, say i. of the motion>> i. opposed? passes unanimously thank you, everybody. >> can you call item 6. >> an action item for the $50 million to black stone corporation mr. hooker. >> thank you norm and commissioners as parks parks and cambridge come up ms. a buy out strategy. >> black stone capital group is the largest alternative investment in the world with $300 billion and counting that there be a reopportunity for the flagship opportunity fund we've

been black stone investors for quite a few for $350 million this opportunity decided the firms global footprint their world-class team and long term track records biggest concern is we have the size of the fund with the target of billion dollars it could be larger than. >> just a few brief comments on what we expect to invest in through fund 7 it will be a large fund as aorta mentioned probably between 38 to 58 investments across several verlgz black stone is known for