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Where is MT investing its tax dollars?



Among the fallout of the Sept. 11 terrorist attack is a new twist on an old cause. As the state of Montana discusses how its financial investments can help the United States in its war on terrorism, the issue of socially responsible investing has come back to life. And this time it is not just the domain of liberal activists.

The Washington, D.C.-based non-profit Social Investment Forum defines socially responsible investing as “integrating personal values and societal concerns with investment decisions … SRI considers both the investor’s financial needs and an investment’s impact on society.” Typical SRI tactics include screening investments so as not to support companies that have poor human rights records or that operate in oppressive countries, and trying to influence corporate policy through shareholder advocacy.

Some local governments, such as Boulder, Colo., have adopted strict responsible investing ordinances. On a wider scale, numerous entities with big portfolios—local governments, universities, nonprofit organizations, insurance companies, and mutual funds—severed their ties with businesses with a presence in South Africa in the 1980s, and tobacco companies in the 1990s. Montana was no exception.

Now the state is considering filtering its investing through a different sort of responsibility: patriotic duty. At the last meeting of the state Board of Investments, held Sept. 20 and 21, the Board discussed whether the state’s investment policy should change in the wake of the attacks on the Pentagon and the World Trade Center.

“It was brought up by one of our members, and we thought that was a very valid point to look at, the fact that we don’t necessarily want to be investing in countries that were, say, harboring terrorists, or that agree with the policies the terrorists had. We don’t want to be supporting countries like that,” says Dick Anderson, owner of a Helena construction company and chairman of the Board of Investments.

The Board will look at the issue in more depth at its next meeting later this month. The investment funds at issue include the Short-Term Investment Pool (STIP), the state-run pool to which many municipalities across Montana contribute. The fund totals more than $1.5 billion, which is invested mostly in money market funds and just over a dozen corporations, many of them financial firms. The City of Missoula has $3.63 million in the fund, and Missoula County has $29.8 million.

The circumstances of Sept. 11 make the current discussion unusual, Anderson says, but the Board sees any new restrictions on its investing as consistent with past actions.

“We feel we have a responsibility in that regard,” he says. “We obviously want to get the best return for the state fund, but we’re also very socially conscious.”


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