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<h2>PROXY VOTING INTEGRITY & TRANSPARENCY ACT</h1>
<h3>Section A: Addition to current statutes governing Treasurer duties</h2>
<p>[Bracketed portions may be adjusted for the needs of each state]</p>
<ol>
<li>State investments; investment managers; list; posting
<ul class="lower-alpha">
<li>The state treasurer shall post a current list of its investments by name on the state treasurer's publicly accessible website and shall update any changes to the list within a reasonable period of time.</li>
<li>The state treasurer shall post the current list of its investment managers on the state treasurer's publicly accessible website and shall update any changes to the list within a reasonable period of time.</li>
<li>c. All investments made by the state treasurer shall be made in the sole interest of the beneficiary taxpayer. The state treasurer's evaluation of an investment must be based on pecuniary factors as prescribed in [insert statutory reference to Section B below]</li>
</ul>
</li>
</ol>
<h3>Section B: proposed new article under statutory title/section governing public finances and the handling of public funds and investments:</h2>
<ol>
<li>Definitions: In this article, unless the context otherwise requires: [Bracketed portions may be adjusted for the needs of each state]
<ul class="lower-alpha">
<li>"Pecuniary factor" means a factor that has a material effect on the financial risk or the financial return of an investment based on appropriate investment horizons consistent with a plan's investment objectives and funding policy.
<ul class="lower-roman">
<li>A factor cannot qualify as a pecuniary factor if the investment agent that has labeled the factor a pecuniary factor cannot demonstrate that the factor is likely to have a material effect on the public fund's financial returns after having undertaken objective analysis of the factor that includes all materially relevant considerations.</li>
</ul>
</li>
<li>"Plan" means any plan, fund or program that is established or maintained by this State or a political subdivision of this state, including a university under the jurisdiction of the [insert state higher education governing body/bodies] and a community college district as defined in [insert specific section references], to do any of the following:
<ul class="lower-roman">
<li>Provide retirement income or other retirement benefits to employees or former employees.</li>
<li>Defer income by employees for a period of time extending to the termination of covered employment or beyond.</li>
<li>Invest taxpayer monies for any purpose.</li>
</ul>
</li>
</ul>
<li>Plans; voting of ownership interests
<ul class="lower-alpha">
<li>A governmental entity that establishes or maintains a plan must make all direct investment decisions based solely on pecuniary factors when evaluating an investment.</li>
<li>A governmental entity that establishes or maintains a plan must vote all directly held shares, or have the governmental entity's directly held shares voted, based solely on pecuniary factors when voting proxies.</li>
<li>If a governmental entity that establishes or maintains a plan has indirect investments or commingled investments, the governmental entity must notify the general partner or investment manager that in all cases where the governmental entity has the option, the general partner or investment manager must:
<ul class="lower-roman">
<li>Make investment decisions based solely on pecuniary factors when evaluating an investment.</li>
<li>Proportionally vote directly held shares, or have the governmental entity's directly held shares proportionally voted, based solely on pecuniary factors.</li>
</ul>
</li>
<li>The governmental entity of a plan may not adopt a practice of following the recommendations of a proxy advisory firm or other service provider unless such firm or service provider agrees in writing to following proxy voting guidelines set by the plan and that are consistent with the fiduciary’s obligation to act based only on pecuniary factors.</li>
</ul>
</li>
<li>Proxy vote reporting [Bracketed portions may be adjusted for the needs of each state]
<ul class="lower-alpha">
<li>All proxy votes shall be posted on the [relevant plan’s website no later than 30 business days in advance of votes being submitted. For each vote, the report shall contain a vote caption, the plan’s vote, the recommendation of company management, and, if applicable, the proxy advisor’s recommendation.</li>
<li>All proxy votes shall be aggregated and reported annually to the [applicable government entity or official] to be publicly archived. For each vote, the report shall contain a vote caption, the plan’s vote, the recommendation of company management, and, if applicable, the proxy advisor’s recommendation.</li>
<li>Reporting required under subsection a and b shall be posted on a publicly available webpage on the [relevant plan’s] website.</li>
</ul>
</li>
</li>
</ol>
</div>
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`Model Legislation
What Steps Can You Take?
Proxy Voting Integrity & Transparency Act
Investments made by public institutions are investments made on behalf of taxpayers
Clarify Fiduciary Rules and Responsibilities
Require pension and state trust fiduciaries only base investment decisions on pecuniary factors like investment performance and risk, not nonpecuniary factors like politics, ESG, etc.
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<h2>STATE GOVERNMENT EMPLOYEE RETIREMENT PROTECTION ACT</h2>
<ol>
<li>Definitions.
<ul class="lower-alpha">
<li>The term “defined pension benefit plan” or “plan” shall mean any plan, fund or program which was heretofore or is hereafter established, maintained, or offered by [the State] or any subdivision, county, municipality, agency or instrumentality thereof, or any school, college, university, administration, authority, or other enterprise operated by the State (collectively “the State”), to the extent that by its terms or as a result of surrounding circumstances –
<ul class="lower-roman">
<li>Provides retirement income or other retirement benefits to employees or former employees, or</li>
<li>Results in a deferral of income by such employees for period extending to the termination of covered employment or beyond.</li>
</ul>
</li>
<li>The term “fiduciary” means a person who with respect to a defined pension benefit plan (i) exercises any discretionary authority or discretionary control respecting management of such plan or exercises any authority or control respecting management or disposition of its assets, (ii) renders investment advice for a fee or other compensation, direct or indirect, with respect to any moneys or other property of such plan, or has any authority or responsibility to do so, or (iii) has any discretionary authority or discretionary responsibility in the administration of such plan, including making recommendations or voting a plan’s shares or proxies.</li>
<li>When used to qualify a risk or return, the term ‘material’ means a risk or return regarding which there is a substantial likelihood that a reasonable investor would attach importance when –
<ul class="lower-roman">
<li>evaluating the potential financial return and financial risks of an existing or prospective investment, or</li>
<li>exercising, or declining to exercise, any rights appurtenant to securities.</li>
<li> When used to qualify a risk or return, the term “material” does not include:–
<ul class="lower-alpha">
<li>furthering non-pecuniary, environmental, social, political, ideological, or other goals or objectives, or</li>
<li>any portion of a risk or return that primarily relates to events that –
<ul class="upper-alpha">
<li>involve a high degree of uncertainty regarding what may or may not occur in the distant future, and</li>
<li>are systemic, general, or not investment-specific in nature.</li>
</ul>
</li>
</li>
</ul>
</ul>
</li>
<li>The term “pecuniary factor” means a factor that has a material effect on the financial risk and/or financial return of an investment based on appropriate investment horizons consistent with the plan’s investment objectives and the funding policy. The term excludes non-pecuniary factors.</li>
<li>The term “non-pecuniary” includes any action taken or factor considered by a fiduciary with any purpose to further environmental, social, or political goals. A fiduciary purpose may be reasonably determined by evidence, including, but not limited to, a fiduciary’s statements indicating its purpose in selecting investments, engaging with portfolio companies, or voting shares or proxies, or any such statements by any coalition, initiative, or organization that the fiduciary has joined, participated in, or become a signatory to, in its capacity as a fiduciary.</li>
</ul>
</li>
<li>Sole Interest and Prudent man standard of care.
<ul class="lower-alpha">
<li>A fiduciary shall discharge his duties with respect to a plan solely in the pecuniary interest of the participants and beneficiaries for the exclusive purpose of –
<ul class="lower-roman">
<li>providing pecuniary benefits to participants and their beneficiaries; and</li>
<li>defraying reasonable expenses of administering the plan;</li>
</ul>
</li>
<li>and with the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent man acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character and with like aims;</li>
<li>by diversifying the investments of the plan so as to minimize the risk of large losses, unless under the circumstances it is clearly prudent not to do so; and,</li>
<li>in accordance with the documents and instruments governing the plan insofar as such documents and instruments are consistent with the provisions of this chapter.</li>
</ul>
</li>
<li>Consideration of Non-Pecuniary Factors Prohibited.
<ul class="lower-alpha">
<li>A fiduciary’s evaluation of an investment, or evaluation or exercise of any right appurtenant to an investment, must take into account only pecuniary factors. Plan fiduciaries are not permitted to promote non-pecuniary benefits or any other non-pecuniary goals. Environmental, social, corporate governance, or other similarly oriented considerations are pecuniary factors only if they present economic risks or opportunities that qualified investment professionals would treat as material economic considerations under generally accepted investment theories. The weight given to those factors should solely reflect a prudent assessment of their impact on risk and return. Fiduciaries considering environmental, social, corporate governance, or other similarly oriented factors as pecuniary factors are also required to examine the level of diversification, degree of liquidity, and the potential risk-return in comparison with other available alternative investments that would play a similar role in their plans’ portfolios. Any pecuniary consideration of environmental, social, or governance factors must necessarily include evaluating whether greater returns can be achieved through investments that rank poorly on such factors.</li>
</ul>
</li>
<li>Voting Ownership Interests. [Bracketed portions may be adjusted for the needs of each state]
<ul class="lower-alpha">
<li>All shares held directly or indirectly by or on behalf of a defined pension benefit plan and/or the beneficiaries thereof shall be voted solely in the pecuniary interest of plan participants. Voting to further non-pecuniary, environmental, social, political, ideological or other benefits or goals is prohibited.</li>
<li>A fiduciary may not adopt a practice of following the recommendations of a proxy advisory firm or other service provider unless such firm or service provider has a practice of, and in writing commits to, follow proxy voting guidelines set by the fiduciary that reflects the fiduciary’s obligation to act based only on pecuniary factors.</li>
<li>Plan assets shall not be entrusted to a fiduciary, unless that fiduciary has a practice of, and in writing commits to, follow guidelines, when engaging with portfolio companies and voting shares or proxies, that match the [governmental entity’s] obligation to act based only on pecuniary factors.</li>
<li>Authority to vote such shares should be in the hands of a State official politically accountable to the people of [State name]. As such, all current proxy voting authority with respect to any and all shares held directly or indirectly by or on behalf of a pension benefit plan and/or the plan participants is hereby revoked. All such voting authority shall reside with [the State Treasurer or appropriate board or committee], [except that the [state official or board ] may delegate such authority to a person who has a practice of, and in writing commits to, follow guidelines that match the [governmental entity’s] obligation to act based only on pecuniary factors].</li>
<li>All proxy votes shall be tabulated and reported annually to the [Board]. For each vote, the report shall contain a vote caption, the plan’s vote, the recommendation of company management, and, if applicable, the proxy advisor’s recommendation. These reports shall be posted on a publicly available webpage on the Board’s website.</li>
</ul>
</li>
<li>Enforcement
<ul class="lower-alpha">
<li>This [article] may be enforced by the attorney general.</li>
<li>If the attorney general has reasonable cause to believe that a person has engaged in, is engaging in, or is about to engage in, a violation of this article, he may:
<ul class="lower-roman">
<li>Require such person to file on such forms as he prescribes a statement or report in writing, under oath, as to all the facts and circumstances concerning the violation, and such other data and information as he may deem necessary.</li>
<li>Examine under oath any person in connection with the violation.</li>
<li>Examine any record, book, document, account, or paper as he may deem necessary.</li>
<li>Pursuant to an order of the [state trial court], impound any record, book, document, account, paper, or sample or material relating to such practice and retain the same in his possession until the completion of all proceedings undertaken under this article or in the courts.</li>
</ul>
</li>
</ul>
</li>
<li>Severability. Should a court of competent jurisdiction hold any provision(s) of this chapter to be invalid, such action will not affect any other provision of this chapter.
</li>
</ol>
<span style="font-style: italic;">(Adapted from American Legislative Exchange Council’s “State Government Employee Retirement Protection Act” model legislation, available at <a href="https://alec.org/model-policy/state-government-employee-retirement-protection-act/" target="_blank">alec.org/model-policy/state-government-employee-retirement-protection-act/</a>)</span>
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</div>`Require Advance Proxy Vote Notice and Annual Reporting
Surface activism in proxy voting by allowing the public to view proxy votes well in advance of being cast, as well as requiring a compiled annual report of all proxy votes annually.
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(Additional Statutory Section) All proxy votes shall be posted on the public retirement system’s website no later than 30 business days in advance of votes being submitted. All proxy votes shall be aggregated and reported annually to the [applicable government entity or official] to be publicly archived. For each vote, the report shall contain a vote caption, the plan’s vote, the recommendation of company management, and, if applicable, the proxy advisor’s recommendation.
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`Require Limited Partnership Status Reporting
Help mitigate activism through alternative asset managers like private equity and hedge funds by requiring the annual reporting of limited partners and all committed and allocated capital.
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(Additional Statutory Section) All limited partnerships shall be tabulated and reported annually to the [applicable government entity or official]. For each limited partnership, the report shall contain the name of each vehicle, when the investment was made, the amount of capital committed, the amount of capital contributed, the amount of the capital distributed, any cost or fees associated with the limited partnership, a measure of the annualized return on capital invested, a break down of the method by which the measure of the annualized return on capital invested is determined, and a comparable passive benchmark. The reports shall be posted on a publicly available webpage on the [applicable government entity or official] website.
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`Require Investment Fee Reporting
Reporting of investment fees will allow for more transparency around the cost and benefit of generally-higher-risk alternative investments like private equity and hedge funds.
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(Additional Statutory Section) All investments, investment management and investment consulting services shall be listed and reported annually to the department of treasury. For all investments, investment management and investment consulting services, the report shall contain, in dollars, net asset value, gross fiscal year performance, net fiscal year performance, any related management fees, performance fees, carried interest fees, or any other fees charged. These reports shall be posted on the [applicable government entity or official] website.
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`Require Pension/Trust Board Meeting Transparency
Ensure taxpayers and stakeholders have access to major planning and investment decisions by requiring materials and meetings are broadcast, published and granted open access to all stakeholders.
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(Additional Statutory Section) Except as otherwise provided in statute, all meetings of fiduciaries shall be open to the public. Each meeting shall be publicly broadcast in audio and video at the time it is conducted and archived on the web site of the system for future public access and use for no less than ten years.
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`Institute a Pension Oversight Board
Creating a dedicated agency or center of excellence to oversee all public retirement systems in your state, both state and local, regarding their actuarial soundness and compliance with state reporting requirements.
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<span style="font-style: italic;">See example: Texas Pension Review Board (<a href="https://statutes.capitol.texas.gov/Docs/GV/htm/GV.801.htm" target="_blank">https://statutes.capitol.texas.gov/Docs/GV/htm/GV.801.htm</a>)</span>
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`Require XBRL Reporting Standards
Because government financial reports are mostly published in PDF format and hard to analyze, compare and aggregate, transitioning to more data friendly XBRL format makes government finance more transparent.
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<h3>THE OPEN FINANCIAL STATEMENT ACT</h2>
<p>Whereas state and local governments are filing their audited financial statements in outmoded PDF formats,</p>
<p>Whereas local governments are required to file both audited PDFs and unaudited Annual Financial Reports containing duplicative or contradictory information,</p>
<p>Whereas many pension systems, fiduciary trusts and component units also file audited financial statements in outmoded PDF formats,</p>
<p>Whereas transitioning these documents to machine readable formats will ease the identification of fiscally distressed local governments and will increase liquidity in the municipal bond market,</p>
<p>Therefore, the State will undertake this transition.</p>
<ol>
<li>Local Government, Pension Systems, Fiduciary Trusts and Component Unit Financial Statement Format
<p>It is the intent of the legislature to replace PDF-formatted audited financial statements with filings utilizing Interactive eXtensible Business Reporting Format (iXBRL). It is also the intent of the legislature to establish these iXBRL audited financial statements as the only annual financial filing required from public agencies by the state. To implement this change:</p>
<ol class="lower-roman">
<li>The governor shall appoint a seven-member commission including (1) a representative from the State Controller’s Office, (2) a representative from the State Auditor’s Office, (3) a representative of a city or county, (4) a representative of a special district, (5) a government accounting researcher affiliated with a state university, (6) a municipal bond investor and (7) an information technology professional employed in the private sector. This body shall be named the “Open Financial Statement Commission” or OFSC.</li>
<li>The legislature appropriates $_______to the OFSC with the following restrictions: (1) none of the appropriation may be spent on member or staff salaries and (2) no more than $_______ of the appropriation may be spent on committee meetings.</li>
<li>The commission shall choose contractors to (1) build one or more XBRL taxonomies suitable for state, county, municipal and special district financial filings and (2) create a software tool that enables financial statement filers to easily create iXBRL documents consistent with the taxonomy or taxonomies. Contractors shall be recruited and selected through an open Request for Proposals process. The OFSC may require the use of existing taxonomy(ies) when prudent to reduce costs and increase comparability between entries.</li>
<li>The commission shall evaluate the contractors’ prototype taxonomy and filing software and specify any changes it deems appropriate. It shall require that all work be completed no later than <<Date0>>.</li>
<li>The commission shall submit a report to the legislature no later than <<Date1>> describing the work products and advising of its decision as to whether to implement the taxonomy or taxonomies.</li>
<li>If the OFSC deems the work products adequate, all governmental financial statements pertaining to fiscal years ending on or after <<Date2>> must be filed in iXBRL format and must meet the validation requirements of the relevant taxonomy.</li>
<li>If the OFSC deems the work products unacceptable, it shall instruct its contractors to make necessary revisions or replace the original contractors with new ones capable of making the necessary revisions. The commission will then make a second implementation decision no later than <<Date3>> and provide a second report to the legislature no later than <<Date4>>. If the commission fails to recommend an implementation by <<Date5>>, it will be dissolved, and the filings will remain in their current formats.</li>
<li>Once a government commences filing in iXBRL it will no longer be required to file a PDF, submit an Excel-based AFR or complete any online forms requesting annual financial statistics. If any state agency is unable to use iXBRL financial statements by <<Date5>>, it will be the Department’s responsibility to convert the iXBRL filing into PDF for its internal use.</li>
<li>The OFSC will be tasked with identifying changes to reporting requirements that bring AFR into alignment with CAFR to facilitate the latter satisfying the requirements for the former.</li>
</ol>
</li>
<li>State Government Report Format
<p>For fiscal years ending on <<Date5>> and thereafter, the State Controller shall submit the comprehensive annual financial report in Interactive eXtensible Business Reporting Format (iXBRL) format if the Open Financial Statement Commission described above has mandated the use of this format by local governments.</p>
</li>
</ol>
<span style="font-style: italic;">(Source: American Legislative Exchange Council’s “THE OPEN FINANCIAL STATEMENT ACT” model legislation, available at <a href="https://alec.org/model-policy/the-open-financial-statement-act/" target="_blank">alec.org/model-policy/the-open-financial-statement-act/</a>)</span>
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`Require Public Trustees be Insured
Unlike in the private sector, public pension trustees are not required to carry liability insurance. Requiring coverage against claims brought alleging a wrongful act in relation to their role as fiduciaries ensures the appropriate amount of accountability.
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(Additional Statutory Section) Except as otherwise provided in statute, all trustees serving as fiduciaries for public pension trusts are required to carry personal liability insurance covering areas such as, but not limited to, breaches of trust, breaches of duty, breaches of statutory provision, negligence, errors and omissions, miss-statements, and misleading statements, and maladministration or any other wrongful act committed or allegedly committed.
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`Remove Investment and Actuarial Management Privileges
Return important fund management duties to taxpayers by suspending management privileges until sound funding policies and metrics are achieved.
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(Additional Statutory Section) Any trustee facing civil or criminal action for breach of fiduciary duty shall be suspended during litigation and a replacement appointed by the board to serve until either the current term expires, upon which the seat shall be considered vacant, or the trustee is cleared of any charges. Any interim appointee must be persons who have demonstrated financial expertise, who have worked in private business or industry, and who have broad investment experience, preferably in investment of pension funds. None of the members appointed under this subsection may be a member or annuitant of the retirement system.
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`Mandate “Excess Value” Consultant Compensation
Pioneered by the Public Employees Retirement Association of New Mexico, this limited partnership compensation method replaces the widely used carried interest compensation formula with one based on absolute returns, completely removing any consideration of the risk associated with such an asset.
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For more information see “Calculating Outperformance in Dollars: Introducing the Excess Value Method” by Avi Turetsky, Matthew Pyrz, Barry Griffiths, Joaquin Lujan and Isaac Beckel (Available Upon Request). A summary can be found at <a href="https://knowledge.insead.edu/economics-finance/introducing-excess-value-metric-private-market-outperformance" target="_blank">knowledge.insead.edu/economics-finance/introducing-excess-value-metric-private-market-outperformance</a>.
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`Require ESG Disclosure with the “Consumer Financial Transparency Act”
Although banking and insurance entities are free to conduct lawful business as actors in the free market, some business practices, like committing to unmandated ESG standards, have the potential to change nature of the consumer relationship and should be disclosed to customers.
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<h5>(Additional Statutory Section)</h5>
<ul style=" list-style-type: none;">
<li>
<p>(A) Every insurer license to transact business in this State must include with any rate filing a disclosure of its use of environmental, social, and governance scores or diversity, equity, and inclusion practices in establishing rates. Individual insurers must justify, with appropriate actuarial data, the use of these factors as part of a rating or establishing rating tiers. Any filer may request that this actuarial data remain proprietary as a commercially valuable trade secret. The department, absent a court order, may not release information which is filed on a proprietary basis.</p>
<p>(B) If an insurer considers environmental, social, and governance scores or diversity, equity, and inclusion practices when it declines to offer coverage, reduces coverage, or nonrenews a policy, it must provide a conspicuous disclosure substantially similar to the following in fourteen-point bold font:</p>
<p class="disclosure">'This declination, reduction, or nonrenewal of coverage has been determined based on a number of factors including environmental, social, and governance scores or diversity, equity, and inclusion policies. Information about [company's] rating and insurance practices related to these factors is available in the most recent rate filing for [company].'"</p>
</li>
</ul>
<h5>(Additional Statutory Section)</h5>
<ul style=" list-style-type: none;">
<li>
<p>(A) Every banking corporation that is authorized to transact business in this State must disclose in a prominent position on its website and in communications with customers if it uses environmental, social, and governance scores or considers diversity, equity, and inclusion in establishing interest rates, offering or providing services, and making lending determinations.</p>
<p>(B) If a bank considers environmental, social, and governance scores or diversity, equity, and inclusion practices when it declines to provide services or deny a loan application, or it charges a different rate than it would for a similar transaction, it must provide a conspicuous disclosure statement substantially similar to the following in fourteen-point bold font:</p>
<p class="disclosure">'This decision to decline to provide services or the conditions of the loan have been determined based on a number of factors including environmental, social, and governance scores or diversity, equity, and inclusion policies. Information about [company's] lending and service practices related to these factors is available on [company's] website.'"</p>
</li>
</ul>
<h5>(Additional Statutory Section)</h5>
<ul style=" list-style-type: none;">
<li>
<p>(A) Every trust institution that is authorized to transact business in this State must disclose in a prominent position on its website and in communications with customers if it uses environmental, social, and governance scores or considers diversity, equity, and inclusion in establishing interest rates, offering or providing services, and making lending determinations.</p>
<p>(B) If a trust institution considers environmental, social, and governance scores or diversity, equity, and inclusion practices when it declines to provide services or deny a loan application, or it charges a different rate than it would for a similar transaction, it must provide a conspicuous disclosure statement substantially similar to the following in fourteen-point bold font:</p>
<p class="disclosure">'This decision to decline to provide services or the conditions of the loan have been determined based on a number of factors including environmental, social, and governance scores or diversity, equity, and inclusion policies. Information about [company's] lending and service practices related to these factors is available on [company's] website.'"</p>
</li>
</ul>
<h5>Additional Statutory Section</h5>
<ul style=" list-style-type: none;">
<li>
<p>(A) A credit union that is authorized to transact business in this State must disclose in a prominent position on its website and in communications with customers if it uses environmental, social, and governance scores or considers diversity, equity, and inclusion in establishing interest rates, offering or providing services, and making lending determinations.</p>
<p class="disclosure">(B) If a credit union considers environmental, social, and governance scores or diversity, equity, and inclusion practices when it declines to provides services or deny a loan application, or it charges a different rate than it would for a similar transaction, it must provide a conspicuous disclosure statement substantially similar to the following in fourteen-point bold font:<br>
'This decision to decline to provide services or the conditions of the loan have been determined based on a number of factors including environmental, social, and governance scores or diversity, equity, and inclusion policies. Information about [company's] lending and service practices related to these factors is available on [company's] website.'"</p>
</li>
</li>
</ul>
<h5>Additional Statutory Section</h5>
<ul style=" list-style-type: none;">
<li>
<p>(A) A registered investment advisor that is authorized to transact business in this State must disclose in a prominent position on its website and in communications with customers if it uses environmental, social, and governance scores or considers diversity, equity, and inclusion in establishing interest rates, offering or providing services, and making lending determinations.</p>
<p class="disclosure">(B) If a registered investment advisor considers environmental, social, and governance scores or diversity, equity, and inclusion practices when it declines to provides services or deny a loan application, or it charges a different rate than it would for a similar transaction, it must provide a conspicuous disclosure statement substantially similar to the following in fourteen-point bold font:<br>
'This decision to decline to provide services or the conditions of the loan have been determined based on a number of factors including environmental, social, and governance scores or diversity, equity, and inclusion policies. Information about [company's] lending and service practices related to these factors is available on [company's] website.'"</p>
</li>
</ul>
</div>
</div>
`Prohibit State Government Entities from Becoming Signatories to International Non-Governmental Agreements
Many state agencies, public trusts and other public entities have taken it upon themselves to become signatories to international non-governmental agreements (e.g., Climate Action 100+, CERES, etc.) without the express consent of the governed and without a clear public purpose. Accordingly, political subdivisions of the state like retirement systems should be precluded from signing on to international nongovernment agreements.
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(Additional Statutory Section) Except as otherwise provided in statute, all state agencies, and public entities not under the direct jurisdiction of the state executive that receive public funding are prohibited from joining, agreeing to, or otherwise affiliating with an organization that involves setting standards or goals outside those prescribed in statute without a join resolution by the legislature.
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}
.second-indent {
margin-left: 20px
}
.third-indent {
margin-left: 40px
}
.fourth-indent {
margin-left: 60px
}
</style>
`