We pointed out that CalPERS kept reducing the State's contribution (8 times in 11 years) but did little to increase our benefits; in fact they were eroding. Jim McRitchie ran ads in Capitol Weekly reminding the Board that, according to the Consititution, their primary duty is to members, not employers. Toward the end of 1998, we finally got the Board's attention and they addressed "equity" issues with SB 400, which raised our retirement substantially.

In addition, we worked to reform the election process. Beginning in 2002, CalPERS began holding a runoff vote if no candidate wins a majority. There will be no more directors elected by 5.5% of the vote. That rule was enacted because board members first voted to prohibit ballot statements which include "candidates' opinion or positions on issues of general concern to the system's membership." We fought that move by contacting members, unions and the Sacramento Bee, which ran an editorial CalPERS muzzles critics: Ballot rules protect board, keep others in the dark. Then we won real reforms.

McRitchie's work in government, business, non-profits, cooperatives and universities led him to understand that accountability isn't something easily imposed from the outside; it must be built into the governance structures of our organizations themselves. Not only has he worked to transform the governance structures of CalPERS, he's also done the same with corporations. (see corpgov.net)

CalPERS has tremendous transformative potential in creating a sustainable economy by seeking triple bottomline returns...excellent financial returns as well as social and environmental benefits. Research demonstrates that companies with good environmental practices, diverse boards, worker ownership, employee participation in decsion-making and democratic corporate governance earn substantially better returns. CalPERS should be encouraging all of the corporations it invests in to have these characteristics and they should use an enhanced indexing strategy to invest more heavily in such companies while reducing investments in companies with poor practices.

By joining our e-mail list (send a request to CalPERS-subscribe@yahoogroups.com) we can network with each other and keep pressure on the Board to transform CalPERS from a top down system of governance to a bottom up one, which solicits input from members. Together we can better help our Board protect our benefits.

If you have ideas on what the CalPERS Board should be doing for members and beneficiaries, please call me at 916-869-2402 (evening). My e-mail address is jm@perswatch.net. If we can identify just one or two members at each department, board, office, campus, union or association chapter interested enough in the issues to spend just a few minutes each month, we can accomplish a great deal.

More about Jim McRitchie (see also intro to corpgov.net site and listing of investments).

Jim was the Ethics Officer and Chief of the Office of Environmental Analysis and Regulations at the Department of Toxic Substances Control (DTSC). Every DTSC project that could adversely impact the environment and every rulemaking had to be approved by our Office. I also provided ethics advice to DTSC staff and ensured compliance with the Political Reform Act, as well as heading workforce planning efforts.

Before his last position, Jim managed the Office of Legislation, directed the state's Cooperative Development Program, held research, analyst, and auditor positions and was a Fellow with National Institute of Mental Health. He was responsible for several studies on medical cost containment, one of which helped lead to the creation of PERSCare (I advocated an HMO, not the expensive fee for service plan we now have). He served on several corporate and nonprofit boards. He holds advanced degrees in public administration (CSUS) and sociology (specializing in the social foundations of economic systems, Boston College).

Jim has been a CSEA member for over 30 years and an RPEA for over 20. He operates one of the internet's most extensive sites on the subject of corporate governance at corpgov.net and has been invited by the Hong Kong Institute of Company Secretaries, US State Department and Asian Development Bank, and others to lecture on democratic corporate governance...how governance reforms can increase bottom line returns and attract additional investments. Currently, he's on the advisory Board of the World Council for Corporate Governance and is a Fellow of the Institute for International Corporate Governance and Accountability (IICGA) at The George Washington University.

At root, I am a labor activist and coalition builder. Let's work together to improve our benefits. If you have ideas on what CalPERS Board members should be doing for members and beneficiaries, please call me at 916-869-2402 (eve). My e-mail address is jm@perswatch.net.

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