TRENTON – Legislation sponsored by Senator Ronald L. Rice and Senator Troy Singleton to require the New Jersey Department of Treasury’s Director of the Division of Investment to attempt to use the services of qualified minority- and women-owned financial institutions was approved on Monday by the Senate. The bill, S-374, puts these usually smaller brokerage and investment management firms on equal footing with larger, more established institutions.
“Minority- and women-owned firms often struggle to get contracts from pension plans because the investment councils of these plans favor bigger management firms with strong brand recognition and longer track records,” said Senator Rice (D-Essex). “We want New Jersey to take the reins of its contracting powers to steer our practices toward a more equitable course.”
Currently, in the financial management contracts industry, only 12 percent of senior management positions are occupied by minorities and 29 percent by women.
“New Jersey is one of the most diverse states in the nation, and we possess a wealth of qualified, minority- and women-owned businesses,” said Senator Singleton (D-Burlington). “Our State government needs to lead by example and employ financial management firms that reflect the diversity of our state, which will ultimately raise the standard of fair practice in this industry.”
Since 2016, New York State has mandated an increase in state contracting and subcontracting opportunities for MWO business enterprises. In Illinois, state law currently requires a state agency or institution of higher education subject to the state Pension Code to set aspirational goals of at least 20 percent of the plan’s assets to be managed by MWO and persons with disabilities-owned asset managers. New Jersey’s legislation would place the State at the vanguard of the diversification movement.
Today’s Senate vote was 34-0.