New Developments in Social Investing by Public Pensions

Source: Alicia H. Munnell and Anqi Chen, Center for Retirement Research at Boston College, SLP#53, November 2016

The brief’s key findings are:
– Public pension funds continue to engage in social investing, most recently divesting from Iran and fossil fuels.
– However, social investing is often not effective, as other investors step in to buy divested stocks.
– Social investing can also produce lower investment returns, conflict with the views of beneficiaries and taxpayers, and interfere with federal policy.
– In short, public pension funds should not engage in social investing.