Responsible Investor Aviators Answer 7 Questions
Please tell us about your institution, and how you began moving toward responsible investment and/or good corporate governance?
The AFL-CIO Investment Trust Corporation (ITC) is one of the original AFL-CIO branded institutions--serving the AFL-CIO Building Investment Trust while also bringing additional labor-friendly products to the pension marketplace. ITC has worked on championing responsible investment since it began operations some 30 years ago. Our view of responsible investment continues to expand and evolve as investor demand for such vehicles has broadened.
How did you get personally become interested in the capital markets, pension fund world and progressive responsible investment and/or corporate governance?
As a college student in Philadelphia I became interested in affordable housing. After landing at the AFL-CIO Housing Investment Trust early in my career, my understanding about the importance of good-paying jobs and access to benefits opened my eyes to the bigger picture of what it means to strive for equity and opportunity for all.
Once I saw what pension funds were doing to further those ideals, I was hooked.
What are the most important issues in responsible investment/corporate governance?
Continuing to prove that trustees don't have to choose between being socially and financially responsible. Identifying and supporting asset managers who are able to measure and deliver on the responsible aspect of their investment strategy while achieving market returns is important to the long-term gains in the industry. This is being validated as we speak and bringing each successful example to bear will reinforce the validity of this approach.
Could you please provide examples of successful responsible investments or corporate governance campaigns (from both a financial and responsible impact standpoint)?
The AFL-CIO Equity Index Funds are a great example. These passive funds are low-cost, competitive products now sponsored by Bank of New York Mellon which vote their proxies in accordance with the AFL-CIO Proxy Voting Guidelines. Now available across all equity indices, these products have been able to attract significant access and have brought together the collective power of labor's
pension capital to make their voices heard.
Have you or your institution established a responsible investment policy? If so, when (year)? Is your organization a signatory to the UN PRI? To any similar standards, benchmarking or reporting bodies? Is this important?
The BIT has operated with a union labor policy since its inception in 1988. This fund, nor any of the other products offered by ITC's subsidiary broker-dealer, are signatory to the UN PRI or any other similar bodies. While these are important institutions, systems which can aid in distinguishing between managers based on their outputs on responsible metrics would have more impact on distinguishing amongst investment managers.
What are your thoughts on the progress that Organized Labor—as the S in ESG---has made in these fields? What more could we all be doing?
The S is harder to measure and is less consistently applied than the E and G. Labor has driven the focus on the Social element to date and should continue to lead and offer expertise on how to define, measure and compare outputs in this area.
Five years from now, how do you see the public environment and market for these strategies evolving? What should the role of Heartland be?
The demand from younger generations will continue to drive the maturity of the responsible investing market. I also expect that the awareness emerging from Covid-19 and the racial justice movement will also be key to driving change in the near term. Heartland has been a leader in convening responsible investment managers and engendering discussions around best practices. With continued pressure on responsible investors to bring about meaningful change, groups like Heartland can help push the conversation in that direction faster and with better results.
Thalia Lankin serves as the Chief Strategy Officer and Special Counsel for the ITC. Prior to joining the ITC, Ms. Lankin served as Chief Operating Officer for the AFL-CIO Housing Investment Trust, overseeing HIT’s operations and strategic planning efforts. She also served in leadership roles with HIT’s subsidiaries, working on New Markets Tax Credit transactions and developing investment
advisory opportunities for its wholly-owned investment adviser.
Prior joining the HIT, Ms. Lankin worked previously at ITC and also served as the Policy Analyst for the Millennial Housing Commission. Ms. Lankin has over 20 years of experience in business development, pension investment and real estate finance.