Honorable Calvin K.Y. Say

Speaker, House of Representatives

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committee on Labor and Public Employment, to which was referred H.C.R. No. 109 entitled:

begs leave to report as follows:

The purpose of this concurrent resolution is to request that the Employees' Retirement System (ERS) engage in socially responsible investment (SRI) by:

1. Reviewing its investment practices;
2. Determining whether any investments are being made with companies based in countries that support terrorism; and
3. Directing the ERS to rethink investment policies regarding companies based in countries that support terrorism.

Comments were received from the ERS.

In the 1980s, anti-apartheid activists brought the idea of SRI to the forefront of the public consciousness by insisting that organizations refrain from investing in companies that did business in or with South Africa. Your Committee finds that in response to the events of September 11, 2001 and other terrorist activity, engaging in SRI, where investment decisions are based, in part, on social values, as well as on financial returns is necessary once more.

Your Committee believes that the State must revisit its investment policies and practices to avoid contributing to the economies of those countries that participate in acts of terrorism, either directly through funding or indirectly through their support of terrorist groups.

As affirmed by the record of votes of the members of your Committee on Labor and Public Employment that is attached to this report, your Committee concurs with the intent and purpose of H.C.R. No. 109 and recommends that it be referred to the Committee on Finance.