>> why don't we go back to action item number 16 please. >> approval of the guidelines for generation. >> same kind of contest and same subje matter. there's repeat just custom made particular for the manager.

but otherwise, always the same as same as every other strategy in terms of content. >> these guidelines are something we discussed and negotiated with generation last six weeks. they are consistent. guidelines are consistent with the strategy we presented you in april. >> okay, great. any other questions from the board. driscoll. >> commissioner driscoll: i'm not sure he we labeled that. i do not see any limitation on

them for doing that. if i read this correctly, even though it's in the theme to be low carbon sustainable companies all wonderful. however, i can see their policy if they wish to switch 100% into carbon company, they can limit on them. it's a compliance issue. >> if they were to do that, is that contrary to the spirit which we hire them? >> you're correct. they have that latitude to do that. it will be inconsistent with their philosophy and process. >> as well as $16 billion other investors have invested this strategy for similar reasons we have. there's an understanding as to what the nature of the strategy is. >> i won't say that i understand

or agree anybody else u nderstanding of the other $16 billion. that's fine. i know what our reasons were for investing in. i'm wondering why there's not such a statement in air guidelines with them. i'll give you an example who we assume people won't do certain things. they did and we lost lot of money. did we break the rules? no, we lost the 1. money. there's something missing in these guidelines. this one was done uniquely without an rfi or rfp. they wound up with the money. >> what would you propose or how would you consider sort of dealing with this? >> i feel like i can possibly refer to the guidelines with

goldman sachs funds. with do not have guidelines for that group either. they are slightly different. but the same concept. why we decided to make this investment. we're trying to not invest -- we're trying to reduce the amount of income for appreciation we're getting from by going to low carbon investments. >> carbon constraints. >> thank you very much. we should address that here so that manager understand what they're not going to do. >> in the contract, if they would change strategy, we would terminate, pull the money out and pull the money back. well, i hear what you're saying. i don't know that we can negotiate. they would be required to meet a

target of 80% carbon constrain. >> not a target. a limit. target and limits are different. that's one. we had contracts with people and they come back and ask us to change the guidelines so they can invest in something else. everything i'm saying here is precedence for it. >> absolutely, we require a new contract if the mandate changes. we can go back to their legal counselor and find out if they would agree to a limit of overall carbon exposure and tear program. but that i think would be highly unusual for guidelines to reflect the reason and the fact that we hold them to the same level of investment in a particular type of manager. from the word go. these are just discretionary

managers. certainly, we understand your concerns. i think that the guidelines have never in the past reflected that we would require a manager to stay to the same strategy. that's reflected in the contrat not in the guidelines. >> that's correct. investment management agreement. >> guidelines here for other policies we have. correct? >> these are guidelines that are objective guidelines and procedures that put limitations on what a manager can or cannot invest in. but they never been to a point that you can't invest in a company that would put you over a target of -- put you under a target of 50% car upon

constraint. we've never had guidelines in my knowledge, that would be that detail to hold someone to a mandate that the attractiveness we believe they are 80% carbon constrain, 73%. what if their 72 or 71 percent. >> that was our goal going to 50, correct? >> just with the understanding that will not constrain them for the rest of their investors to go ahead and make that investment to bring them under 50. all it's going to say it would trigger us having to make a decision whether we pull our money from them. they are investing not just solely on our behalf where we can control how they invest the fund. this is a flag ship fund. >> this will be separated managed account. they had closed their fund or

their strategy in 2010 management capacity through a wait list. she expressed interest to them in having potentially take up some of that. capacity came available r ecently. i would say with our carbon efforts. i think we can talk to generation and perhaps what i would suggest, we can put something in here where they would notify us footprint of their portfolio toly to the 50%. i wouldn't consider the guideline. >> honestly i would. the motion that was suggested by the staff board adopted was item one, $1 billion. >> that was goldman sachs. >> then it was amended and s plit. 500 for gold. and 500 for this group without an rfi and rfp. same issue trying to reduce our

carbon exposure. >> carbon emission reduction is something that has been captured and measured for this strategy or us by goldman. they need to get data third party to measure that. i don't think that generation, actually provided that 73% q uote. >> methodology, they are both using the same vendor to determine that. >> is this something -- >> i would go back commissioner driscoll's original point. you approved up to a billion dollars and a constrain s trategy. it is not off the table that we will do that in an index format rather than generation. as a coincidence the timing of

which we got the opportunity of very limited opportunity to invest in generation flag ship product, we basically said this is even better than a 50% carbon constrain strategy. we didn't say the reason we're recommending generation is because they will maintain a minimum level of 50. we basically said the combination of a $300 million commitment to generation and $500 million commitment to the goldman sachs carbon constrain index give us better than 50% reduction for that $800 million. you've not approved the additional money for cartca. all we committed to is half billion dollars. which is half through the target of index strategy to reduce carbon emissions by 50%. in the meantime, we brought you a separate recommendation tat

was not true through an rfp or rfi. we would be interested in participating in a flagship. when it became available, we brought it to the board with the recommendation. it was going to reduce that portion, that $300 million to be 73% carbon constraint. >> that was not how it was presented to us by the staff. it made other desirable attributes. >> that in my mind has never been what we presented to the board. we happen to say that we committed $500 million.

board approved the generation and the cartca, we would have billion dollars in the cartca. >> unfortunately we have documentation of our initial contact with generation. we have documentation of the notification of us that they know that we're on a waiting list they're opening up or c losing down their headquarters and they want to be h eadquartered in san francisco and they thought it would be to their public relations benefit

to have us as a partner. we have documentation of the entire contact that we had d ating back three years.

>> i don't want to miss an opportunity to vote on something if we talk for too long. if we approve -- if we don't approve this today, would that have negative effect on funding or will it delay us. how would it impact us? >> the item was approved, we'd hope to do the guidelines last month. we deferred to now. i can't comment -- >> how do we -- commissioner driscoll, you view this as a carbon constraint strategy. that is how you accepted it. >> commissioner driscoll: yes. all the variations -- we could have done both. billion to goldman sachs the way it was done. still done 500 here. >> we will bring carbon

constraint strategy into the future that will not be measured against the billion dollar decision that the board made to invest passive money. >> billion dollar item in my view was the force of the funds. we had billion dollars in p assive equities that will be converted into low carbon strategies. this was the timing of generation with coi coincident. we have capacity at the moment just 300. >> how do we deal with this? >> maybe two suggestions. i have the time line of the events from generation in an email. i'm happy to provide that to y

ou. commissioner driscoll, that's in their own words. it shows the dates. this became available to us in late november. we began doing due diligence on the strategy in early january. we can provide that for commissioner driscoll. the second is while these around their standard guidelines. if we were to include a limit of 50%, my gumption is that is something they would accept. we'll catch them little off guard. we can ask for it and i think they would probably accept it. is that okay? >> you're suggesting a contingent approval. >> yes. >> we would ask to include the

carbon emissions reduction relative to the index will be at least 50 per. -- 50%. >> i'm not quite sure. >> contingent approval that they would agree to that, no better than passing it until we've had a chance to talk to them. if they don't agree to that, then we still aren't committed to investing in it. i don't believe it was the soul basis of the recommendation for the board to invest in generation based on the fact that will provide 73% carbon constraint. >> there's a relationship sense here. they were matching, trying to match outflow with and inflow. they have an outflow because

they've done really well. their expectation is that we would perform. >> my perspective is that, to be clear, back to the original question. board approved up to $1 billion carbon constraint strategy. >> the board approved an index investment up to a billion dollars and a carbon constraint strategy that would be 50%. target of 50% carbon constraint. >> we have done up to $500 million? >> $500 million and right after the board approved it. >> from staff's mind was that the other $500 million? >> it potentially could have been. it's not clear that that is -- certainly -- well, it could have been. the coincidence was we said the combination of these two

actually achieve better than a 50% carbon constraint against a billion dollars. >> the way the item was presented means that's exactly how it was done. we didn't vote on goldman because it was done. >> we're talking about generation guidelines here. that was a separate recommendation. >> it had to be. >> stood on its own. was not in combination with the 6-point strategy was in support of chiefing higher carbon constraint target than we presented. >> generation was not one of the six points? >> no. they weren't. >> the whole program that goldman sachs outlined for you with respect to environmental protections set index fund where is not making long term

evaluation, it was okay to trade off tracking error against carbon footprint. with regard to acting m anagement, it did not suggest you put constraints on active management. it said you ask them when you hire them to consider the risks of the environment in their process. then in private markets you talk about constructively investing in technology that hastened the use away from fossil fuel. i would be incomfortable where you to apply noninvestment constraint to an active manager. i don't think that was the intention of the movement around generation. i think you hired them because they had the best possible return against level of risk they took. the fact they were constructive on carbon was a nice thing but it shouldn't have been a contingency around which you hired them. i get uncomfortable if going to

mixing discretionary managers with social constraints. that's a slippery path. >> not the way those items were presenterred to us when -- presented to us. that's the way they were p resented to us. >> i have no basis to say whether or not the conversation was presented in the way that commissioner driscoll was s aying. i don't have that information. in terms of the question that our president asked previously about the impact of not move on this. we have a meeting up next week, investment committee, that is a committee as a whole. is there a possibility from our legal opinion that we could potentially delay and pick this back up next week and schedule

perhaps call a special meeting of the whole? >> i believe our committee b asically says they can't take action right now. >> we'd have to call a special board meeting. >> you have to call a special meeting after that meeting. >> the meeting there's, i think it's going to take little bit of time for us to read through and understand what happened in the course of events. i understand, you got a time line that you're able to share with commissioner driscoll as well as rest of us so we can educate and inform ourselves how would one week delay in this decision impact this investment? >> even if we delay it, is it going to solve anything? commissioner driscoll, do you see any resolution to this over the next week? >> commissioner driscoll: issue about managing the relationship. the timeline it's irrelevant.

it really is. it's about what guidelines we want on this manager and the carbon issues what i believe is one of the reasons we drove to this. one of the reasons why it was presented to us. >> timeline is relevant to your statement that you don't believe that hahn put her name on a w aiting list when he was first hired she knew of the flagship fund in her previous work. they reached out to us and notified us there was a very unique opportunity. we were looking at an asia opportunity and we weren't really going forward with that. they notified us that this was an opportunity. the timing of it was completely coincidental outside of our h ands. it wasn't presented as part of the six point recommendation. it was reported out that would also do better than a 50%

constraint strategy on passive index >> question was asked of me least at least month. can i ask how question about changing the commitment that $1 billion, i said the point is, the rate of return we're able it get and reducing our carbon. no names were given to me. couple of weeks later, in comes this recommendation for generation whom i met thanks to hahn. i don't think it's a simple coincidence how this happen. do you remember asking me this question? about changing the investment about is it okay to change something like that? >> what i wanted to ask was in the implementation of the billion dollars carbon constrainted strategy would it

be accept a believe to do $500 million to the goldman strategy and 500 generation. >> you did not say one name in that meeting. you did not say one name in that meeting. i will recall other people sitting at the table. they were talking about the investment committee meeting agenda. you said hold off ini will ask you a question. objective was rate of return in reducing carbon. that was the objective. what shows up. >> let me ask you, if we say, this is a part of the $1 billion carbon constraint strategy, we are not willing to meet those guidelines whatever they might be for that 50% reduction. therefore it's not part that one billion. are we going to put another $500 million into index carbon

constraint strategy? that's what we're talking about here? >> you approved up to a billion dollars in a carbon constraint passive index that would reduce our carbon exposure by 50%. specifically passive. that was the recommendation. >> it is not passive. >> discretionary manager and to allen's point, we never put any kind of restrictions short of the social investment of the tobacco, the guns, those types of restrictions on it. we never formulated that you kept go under 50% target of being carbon constraint. >> generation returns were quite good independent of the consideration. >> they're excellent. >> there's quite a bit of overlap. their philosophy and our

philosophy regarding esg. >> i would agree. >> there seems to be back and forth about what was approved and what wasn't approved on a 6 -point plan. can we follow up offline and iron some of those details out in the interim, if we approved this, without carbon constraint strategy, it still leaves possibility to go back and increase our index up to the billion dollars. for me, i would have supported this independent of their esg considerations just based on their track record. commissioner driscoll, how do you think we go forward with this? >> commissioner driscoll: that was the first option. if it come in. $1 billion to goldman sachs again, no rfp, no rfi.

certain people believe the board owes vote on the adopt a strategy meant they can do it. >> we're talking about generation. >> commissioner driscoll: no, based on point one. if staff come back, we invested $1 billion with goldman sachs. that's that point. by the way, we found another manager we would like to hire. even though there's no rfi or rfp. >> as i pointed out, it was no requirement that we go out with an rfi or an rfp to bring recommendation of generations to this board. i don't like the implication that -- it's certainly not normal. certainly within city policy and our policy. >> commissioner driscoll: we have a group and area called opportunity investment. we have opportunity investment all the time brought to us. within the public security area. that was not addressed either. it was brought all under the

context of this board step one. >> i need to go back. i want to review what we presented as a recommendation to the board because i do not believe -- i don't believe in the meeting that this exchange that you're talking about. i would certainly say it was never my impression that these were lock step. that it was part of the recommendation or the driver of the recommendation was to fulfill the other $500 million commitment to carbon constraint strategy. it happen to be coincidental this was going to achieve r eaching a billion dollars in more than a 50% carbon constraint series of two strategies. i don't recall it ever been presented to the board as part of our first recommendation which was up to a billion dollars in a pass carbon

constrained strategy. i'll review the materials to see if we presented it as part of our first recommendation on fossil fuel. >> commissioner bridges i want you want to say something. >> commissioner bridges: after reading through this recommendation staff today. i wasn't involved all the other meetings. i think my concern is if we keep delaying it and i know how hard it is to convene meetings with this board. we missed an investment opportunity. i don't want to miss the opportunity that we have before us. if we wanted to delay it, which sound like you want to -- complied >> commissioner driscoll: i don't want to delay it. i just ask a different word to be put in there. implication. >> we can request that? >> commissioner driscoll: i don't think we should. we have advice from the board

investment, consultant. that we start with this one and what's going to prevent us for having to do it. they are there's discretionary managers. >> i think we either move forward and try to take a vote today in which case you'd call the item and have folks vote on it. or we try to see if there's any information that can be provided in an interim that helps with concern. without knowing the background of this item, what was said at the board, but also not understanding why it was that we brought in an active manager without an rfp or rfi process. i'm uncomfortable voting for it.

either call the vote today or delay and call full board m eeting next week. >> commissioner driscoll would you not hire generation if they didn't agree to 50% carbon constrain? >> commissioner driscoll: quite possible. we have other restrictions on discretionary managers. you can argue what is a restriction, what is a g uideline. i know their numbers. allen martin, met him, have high opinion of him. there's good thing about the numbers. thing about the carbon, i want that put in there for a reason. if they're not part of this whole plan reducing earnings from carbon companies that use carbon, let's get that phrase correctly.

all this investment does not reduce carbon emissions. you probably figure figured that already. how to make this investment b ased on the policy we're p ursuing. the objective that we're p ursuing in the whole esg area. i'm not against generation. guidelines i believe were not addressing why we invested in them. sorry to keep repeating that point. >> i have a different perspective. i felt that generation was a nice fit for what we're trying to do. i don't feel that they checked a box on one of the six points. that's of opinion here. commissioner casciaoto you have any thoughts? >> commissioner casciato: i'm trying to sort it out. i'm trying to sort it out if we

can come to some type of compromise. >> this fits with the goal that the board has set forward to invest $1 million. it has fit within the goal of the 50% carbon constrain. we believe it will do better than the 50%. that's not the issue here necessarily. the organization seems like a solid organization as well. that's not the issue either. it really sounds like it's a process question and whether there was something that fell outside of our process. i need an understanding of whether that is true. the strategy that was approved from what i understand was to be investing in passive fund. this is not a passive fund. normally, typically what we have

done with something like this? >> it was staff's intention to substitute $500 million in generation and additional $500 million passive carbon constrain strategy the goldman sachs strategy. that was not an official statement what staff intent was. i still believe you approved that we could invest up to a billion dollars with goldman sachs or another carbon

constrain. >> this is not a passive index. >> that's what i said. we satisfied the billion dollars when you particularly voted on that being a passive strategy for up a billion dollars. generation doesn't fit the definition of what our number one recommendation is. they're an active discretionary manager. >> normally then, with an active discretionary manager, what would have been the process that normally would have been. >> it was more than one staff member present. >> even so -- >> commissioner driscoll: that's why i want to go back to the record what was presented to the board. what the board voted on. >> i think it's pretty clear, what we voted on was a carbon constraint index.

>> that's very clear. your question commissioner, does the process requires an rfp it does not require an rfp or rfi or an active. normally how would that have come through? >> commissioner driscoll: we find them different ways. if we are looking for particular geography, we will issue rfis. we have management information. >> i think what i essentially want to know, would it come back to a different process to this board? a typical active manager engagement. >> commissioner driscoll: we have an rfp outstanding that we made a recommendation to the board two months ago that's been brought forward. when we're doing a global s

earch, we believe an rfp is the best way to gather potentially new products or new strategies. we issued an rfp that's now over a year and a half old. we do an review when we're doing a -- review rfp when we do a b. we have 120 responses. we went through that rfp p rocess. this opportunity, they would not have responded to an rfp because at the time, we issued the rfp, their flagship product was c losed. they had no capacity to have any new investors. when the opportunity after we posted the rfp, after the rfp had closed, we were reviewing the responses to the rfp, we were notified that we were selected from the waiting list. there are lot of other people on the waiting list who would love to our $300 million or $500 million allocation that we had the opportunity.

that's why we brought that forward without an rfp or an r fi. we did our due diligence. we met them for two or three months. i've had discussions with them. this was an opportunity that wouldn't come through an rfp because of the nature of the product. we made as transparent as possible. we arranged meetings with people when we were doing due diligence on another of air product. it was asian fund. we introduced them to board members and i believe board members met with them. this opportunity for us to go into the flagship was out of our control. >> quick follow up question to our city attorney. can you confirm in terms our

action today there's nothing that will prevent this body from investing opportunity. >> there's no legal requirement for an rfp. that's in the board discretion. >> commissioner casciato: you're the one of the expert that we have reliance on. can you tell us, tell the board, what is your understanding of what is going on here today and what is in your opinion, is our expert consultant. >> again i was not part of the discussion bill had. the whole discussion of the esg

the policy that you approve, one element was to allow the imposition of an esg constraint against passive manager. with regard to active managers there was no suggestion that you should apply esg constraints to active manager. you should in hiring them express the view that this board is concerned about the action of unuse of carbon. you should tell the manager before you hire them, you would hope they car that risk -- they consider that risk in their process. with respect to your private markets, indeed you would look for strategies. if you can money on strategies that will help move us away from

dependence on fossil fuel, so much the better. i believe that the opportunity to invest with generation came up just they educated. it's i ndicated. i believe this board, we did the due diligence on them as well as staff. our recommendation to hire them as well as this staff recommendation to hire them they were an outstanding manager in terms of return for unit of r isk. by the way, this is a very environmentally sound and responsible manager we like more of them. i don't think the condition of hiring them was based on that. it was based on the fact that they were good manager. i personally think this board puts itself in a dangerous position with respect to

fiduciary responsibility. you can express the views and values of san francisco and hope they would adhere to those. but telling an active manager they can't buy xyz or they should buy companies that are headquartered in san francisco is dangerous with respect to your fiduciary duties. i think you should approve the guidelines as they are proposed here. if joe loaded for generation on the belief they were satisfying a carbon footprint, that's an important issue. i don't think this board approve generation because of the carbon footprint. they approved them, they're an outstanding manager against the risk they take. they compliment your portfolio. to go beyond the guidelines and impose other conveyances on them -- constraints on them would be inappropriate. i would approve the guidelines as indicated.

i'm very respectful of joe s aying he was you were the impression that this was helped satisfy the carbon issue which i personally i don't think it was. >> commissioner driscoll. >> commissioner driscoll: i said two toes ago the impression how i was -- i forget how i phrased it. when we voted on adopt a strategy, staff interpreted right to hire and fund a m anager. but impression i got out of a, that's part one. two, this thing about generation. there was no rfp or they were not able to participate their businesses in the rfp. there was no rfi. sometimes they are announced to us in advance. we have voted on opportunities when they are presented to us. generation thing was not p resented he3e as an opportunity which just duck tailed right in between, by the way, ejust f

unded $500 million with goldman sachs and cartica was the next item. same item on the agenda. >> we can verify that. that is not my recollection. there were two separate items. generation was a stand alone recommendation. i can certainly go back and verify that. it's not my recollection -- my recollection does not agree what you just stated. they were a combination or even tied together to items separately tied together. i was not at this meeting where the other discussion took place. as far as i'm concerned, we still have the board approving up to billion dollars in a p assive carbon constrained strategy mandate this we're considering completing. >> couple of things please. we can either set aside or move

forward. i just reviewed the language from 6 point plan back in april. no, it was february. thank you. january. it's very clear the language approved by the board said i ndex. now the question becomes, this is clearly not an index. it's active. i also just reviewed the generation investment m emorandum. although it references the fact this they have a smaller carbon footprint, it doesn't specifically say -- it's not somehow discount any conversations that were had. the minimum doesn't say that it is a one to one swap for that billion dollar carbon c onstrained passive index. the question becomes that are we going to increase our passive

index center 500 to a billion dollars with goldman or someone else. will the board come back and say that this is a substitute but either way, i think the returns and case made by staff and the original generation write up was based upon the performance not necessarily their esg considerations alone. what i would like to do is follow up offline, deal with this issue of whether or not it is swap or not. i think commissioner divis driscoll, you and i, we agree on some of this stuff. we agree on little bit different direction. i'm happy to call the vote if that's what the board wants. to the extent that board members don't want to vote on this, that's the board's choice. >> i would suggest that we call a vote on this item. i think based on the discussion

that we had our city attorney with regard to the process, i'm comfortable with moving on based on the economics of this. >> i think it sounds like there's votes for this to pass. i'm guessing here. there's some issues here that if we do vote on this and it does pass, still maybe unresolved. i think we need to get to the heart of that matter. commissioner driscoll, i'm going to call for the vote on this. but, i think that you brought up issues we need to deal with. it's not the first time that they've come up. as an addition to the vote t oday, can we follow up on this and deal with some of this? >> commissioner driscoll: can i ask a question before that commissioner? if we vote yes today and this issue can be investigated, if

there's something that comes up in the investigation, then any one of the members that voted yes can move a motion to reconsideration to open up discussions to review it. correct? >> that is the parliamentary rules to vote. motion to reconsideration. >> we talked about what the carbon reduction is, is that something they rot out anyway or something that goldman and overlaid it upon their investments? >> it was from generation. it is something that they promote if you will and can report on. >> that's something that we can report to the board on an annual basis to track this? >> certainly. commission driscoll? >> commissioner driscoll: it is low carbon.

sustainability and low carbon. let's make sure there's a 50% limit how much carbon producing mpanies able to invest in. i thought it was more than a fair shot. >> can we make it as a marker for reporting back to the board as opposed to determination or constraint on them? >> commissioner driscoll: as opposed to a guideline? >> president stansbury: i'm not conformation comfortable making a guideline personally. i understand there's some unease with this. if for some reason they change their strategy, that might pop up in terms of their carbon footprint. is that something we can mark as something to watch >> commissioner driscoll: here's suggestion trying to answer your

question. if the motion on the floor to adopt the guidelines staff committed, that goes fine. i'll be voting against that. i'm not trying to change a nybody's mind. effectively this issue about change maintaining the relationship with generation. i understand they think they understand our board dynamics. that's fine. there's always the objective by the board to make us a very desirable investor or partner. which is one of the issue about relationship building. that's how restrive to make very solve great rates of return. i'm uncomfortable about how the whole issue of the hiring and funding of goldman was done let alone generations. particularly goldman. that's one why i'm digging in he heels on this issue about the whole decision-making process was executed on this one. too many misunderstands on this whole issue.

i'm not against reducing carbon or i'm for divesting. here we are fighting over what one guideline i think beneath their own state of philosophy. to close this out, let's vote as recommended. i'll vote no. i have to deal with whatever comes up later. if i have more facts, i'll bring it back to change your mind. i'm not trying to blow up the relationship between us and generation or goldman sachs. we spent lot of time on this issue. >> you and inhad a discussion about doing it additional $500 million investment in another passive carbon constrain index opportunity just last friday. to say that we haven't filled if the deal that this $500 million to generation would preclude that doesn't square with your

and my telephone discussion last friday. >> commissioner driscoll: that precludes us putting $500 billion into that strategy. we don't have that much money. >> the board voting up to billion dollars in carbon constrain passive index s trategy. half way there. >> president stansbury: i think there's issues here. we need to deal with those. i don't think for me, i'm prepared to vote on this today. it sounds like the board is. i will call for the vote and then let's follow up offline on some of the other stuff that we can -- everyone can get comfortable where we're at. >> just reminder, public c omment. >> president stansbury: thank you, that's fine. i will make the motion to accept staff guidelines as written.

>> second. >> president stansbury: there's a second. call for public comment. are there any members of the public like to address the commission on this matter? seeing none, i will close public comment. any discussion from the board? >> more than meets our esg g oals, the confirmation of the rfp and rfi process. i'm comfortable voting for this. when we get to discussion item number 22, we'll be adding additional items with regards to ensuring our process. >> president stansbury: okay, i think that's fair. call the vote vote please. [roll call] motion passes. >> president stansbury: thank you very much. thank you for the discussion. where are we? what's next?

we still have 12, 13, 14, 15, 19, 20, i will continue to next month, we still have 21, 22, 23. we are pushing up on 6:00 here. i know we will be losing some board members. we have an issue with quorum. where would you like to go if we wrap this up in the next 20 minutes? is that okay for the board and staff. we may not able to get to every single item today. we have hit all the action i tems. i know pushes things to next month. which i hate to do. where would you like to go? what do you want to get done

today? >> we could do -- i think we would need more time to do 12, 13 and 14. >> president stansbury: how long would it take to do 12, 13 and 14 an hour. >> probably at least 45 minutes. >> president stansbury: that will be item number 12 and 13. >> right. >> president stansbury: okay. some of the others don't to be long. we call items 12 and 13 together since it's the same person. we can flow from one item to the next. great. let's call items 12 and 13

together. >> market performance report. >> just to be clear, 13 was an item dedicated to private c redit. from cambridge and and torrey . >> president stansbury: 12 and 13 together. >> thank you. apologizes to torrey cove who has been pulling their heels since 2:00 waiting to present. some of what you hear, there's going to be overlap what cambridge presented. we're talking about the same portfolio here. tory cove is monitoring r eporting consultant for our private investment portfolio. they perform behind the scenes

from board perspective. but very important job for our portfolio because they manage to track over 200 managers in terms of partnerships, multiple of that in term of underlying portfolio companies and thousands of transactions in between our partners and our portfolio. i think they can present the performance of our portfolio and the fees that we pay for that performance. >> in the interest of time, i'm not going to repeat things that cambridge and art and bill already told you about the portfolio. in short, it's been a terrific portfolio. you've done well as they've expressed. what i like to say, so far the private equity portfolio, we can jump to real assets and private

credit. you gotten back more money than you put in. you still have $3.8 million. which is pretty terrific. you have portfolio diversification. i have interest in over 2600 companies with both public and private. across multiple sectors across geographies and segregated by stage. it's pretty well diversified relative to what you can do. i would make one observation if you had not invested in private equity over the course of your history, your portfolio would have been $700 million. that is to say if you had taken the public equity allocation and ignored private equity and increased for the $7 billion you've invested over time, you would have been $700 million

worse off. i think that's pretty significant relative to the size of your program. is there any other points r elated private equity that i missed? >> over the last year, your portfolio appreciated about $500 million driven in that particular time. i know that growth has been an initiative over the past several years and it's playing out very well for you. >> i think there's one more point that we should talk about which is announcement of your fees by management fee and c arried interest. in your program, your management fees are about 90 bases points. relative to the market, it is actually lower than