You know without objection I’d like to approve the agenda by consensus for the Investment committee meeting if without objection and approved okay? Why don’t we begin I see two four do believe we have a quorum present so it brings us to item six Excuse me item five on the agenda but before we do that we’re going to have our speaker from FasterCures at the Milken Institute speak with us today about the resources that are going into address this global health crisis. The financial resources as well as the human capital that is being spent around the globe trying to find a solution, a vaccine. And I don’t want to botch your last name Esther so I’m going to refer to you as Esther. I had the opportunity to be on a call that the Institute hosted a few weeks ago in which you participated and I think you have some unique insights and visibility into the efforts that are being put in place to find a solution to this global health crisis that has now rippled and made its way through the economic fabric of the world. Chris do you want to add anything before we turn it over to Esther? Hey Chris just quit will fix it Jonathan I’m not seeing a feed on YouTube. Is that actually we said is that working? I’ve got a laptop beside me and I’m not seeing the YouTube feed Sometimes it will take some time for it for it to load up so it could already have started and just hasn’t gotten to you’re ahead of it, a YouTube. Wow, okay. (laughs) I don’t hear that often. Okay thanks It’s still not on, but okay as long as you can see it on YouTube. Esther, on behalf of CalSTRS thank you for making time to be with us today of course for your patience as we were conducting some items in closed session that took longer than anticipated so thank you on behalf of the board for your being here and for your patience Christopher? Thank you Harry, and thank you Esther for being here. We felt that with so much information and misinformation coming out about the potential of a treatment for the virus and ultimately a vaccine, it would really be better to hear from a health expert of what’s going on across the industry. You know as we said before this is a health crisis, not a financial crisis. It’s a health crisis that created a financial crisis. So we need to talk to somebody about really what’s going on what are some of those expectations on a timeline or scaling up the medical side so Esther please share your thoughts? Thank you so much for having me I’m delighted to be here and certainly recognize the important business that you are taking care of as a board in your closed session. As you mentioned we work at FasterCures on medical research and we bring that lens and perspective to this crisis and our normal day-to-day jobs we look at biomedical research and innovation how do we accelerate the process and so at a time like this it’s exactly the right kind of organization that should be very much involved with what are we doing relevant to the medical development of how we can really mitigate the most severe effects of this disease that we’re seeing this pandemic I’m sure you all are following the numbers very very closely of the cases that are confirmed both in the United States but also all over the world where we’re seeing increasingly but the number of those who are diagnosed continues to rise though it is coming down in certain places like in New York. We look across the U.S. on average the curve is actually not necessarily bending and that’s due to the virus going into the middle of the country in different parts being affected at different rates Globally of course, we’re seeing that same kind of trend as well. We developed a treatment and vaccine tracker to provide some clarity around as we are seeing the science evolve with who is more susceptible to the virus particularly for getting the worst outcomes and severe illness. What can we

do on a treatment side? What can we do on a vaccine side? The focus of course being on both what we expect to see in the short-term or more therapies that can address the virus and the illness on the treatment side. And that’s really important as you see patients that are hospitalized in ICU on a ventilator you’ve heard a lot in the media and other elsewhere around the need for ventilators that was big crisis in March and April Seeing that of course come down as hospitalized hospitalizations are going down but what can we do in a treatment setting so that those who are most severely ill are getting the right kinds of treatments to mitigate those outcomes? Because it’s going to take much longer for vaccines. So the trackers provided some clarity around that. We’ve had dozens and dozens of conversations with everyone who’s working along the entire medical research enterprise from the National Institutes of Health to Bardo the biodefense agency to biotech small biotech large pharma etc. So I’ll just lay out some of the things that we see from a landscape perspective and then open it up for any questions that you might have. From a treatment perspective, we are tracking two hundred and three potential treatments that can address this virus that are compounds that have either been FDA approved for different indications. Or there are those as have a good safety profile they’ve been well studied for other indications and therefore because they’re largely safe we can study them very quickly for four coronavirus. They largely fall into a few different categories I’ll start with antibodies there are 57 categories of candidates that fall into the antibody track and these are therapies that are either taking plasma from patients that I’ve recovered and therefore have some antibodies in their body and in using that for patients that are ill or creating synthetic versions of that. So for example some companies like Regeneron for example have actually been successful in cloning human antibodies in mice and through their technology they are going to extract that antibody from mice those that have the most potent effects and creating significant doses that could be used for for humans. As you can imagine of course because of the nature creating that kind of technology this is not for wide use in the population this we’re talking about thousands or millions of doses potentially but not the billions that you will need to treat a world population. But there are a lot of efforts there in fact the American Red Cross has begun to ask donors who have recovered from COVID-19 they were diagnosed positive they have since recovered to donate their plasma to come in and provide those samples. The New York State Health Department is using those samples both to treat patients but also for these clinical studies that are underway with antibodies. There’s a lot of progress and significant help there we expect to get data for some of these clinical studies this summer if the goal of course is to have doses available by the fall and if those proved to be successful more patients can be saved and it would mitigate the effects of reopening the economy and potentially having a second wave in the fall. The next category are virals we have 24 candidates that we’re tracking in this category you can think about antivirals very much like HIV medicines that stop the replication of of the virus in the body. The most promising antiviral that we have we have seen is Remdesivir which was studied and put into clinical trials one month after we saw the virus in in China the NIH to move very quickly to start a clinical trial with Remdesivir. Remdesivir is an IV infused medicines for hospitalized patients and severely ill patients that again are either on a ventilator or receiving high oxygen flow. The early data that we saw come out on April 29th shows that there is a 31% recovery time for patients who received that treatment versus placebo. Before that we saw earlier data that came out but of course that earlier data was from compassionate use it was not a clinical controlled study and so what we saw in April 29th was the first illustration of a clinically controlled study that gives us some hope that Remdesivir could be

useful. It’s important to note that it helps with the time for recovery which is quite important and quite critical but it is not a cure it helps again to make sure the patients are able to get out of the hospital faster but what we need are not just one or two or even three therapies we need a whole series and platform of therapies that could be interchangeably used depending on the patient that’s being treated Therefore there are other technologies like cell based technologies for example RNA based technologies those are earlier in the pipeline those are very much preclinical it’s good to watch but our hope right now are on antibodies as well as even different formulations of REM disappear and inhaled formulation potentially where you’re not receiving it only by IV but potentially you can inhale it just as you would have an therapy what we’re also following with these studies is the clinical trial so they’re eighty-one of these compounds and preclinical trials, and and what that means is that they’re being studied in labs they’re being studied in the animal they have not yet gone into human for a coronavirus indication we do however have a hundred and twenty two that are in clinical trials and and that’s that’s really good to see. We expect to see a lot more come into clinical trial by the end of the summer into the fall we have a very strong treatment pipeline for COVID-19 on the vaccine side We’re tracking a hundred and twenty three vaccine candidates we saw that moderna, the first out of the gate, in not only getting a clinical trial underway, but even as as we saw today they have now moved into Phase Two of clinical trials. There are many different platforms and vectors being studied for a vaccine, whether DNA or RNA or an attenuated vaccine, essentially meaning it’s the virus but in a weakened form Most time lines indicate twelve to eighteen months before we see a vaccine that could be used widespread in the population. I would say that is highly ambitious, we have never had a vaccine developed in that timeline, one of the fastest was the Ebola vaccine, that took five years to be developed. If you think about HIV 30 plus years later we still don’t have an HIV vaccine. the scientists are very helpful there are a lot of efforts underway great partnerships underway with large vaccine manufacturers GSK, Santa Fe, Pfizer, J&J, organizations that have deep expertise in the development of vaccines, are all working on this. I mean we’ve seen the announcement by Pfizer and their partner BioNTech, they started their phase one trials in humans just last few days, so a lot of efforts underway and we expect to see even more of these vaccine candidates go into clinical trials buy it by the end of the year. What’s happening and accelerating that timeline So typically it’ll take ten plus years to develop a vaccine what is happening right now or that we’re continuing to follow the right clinical trial process scientific process a phase one safety trial followed by Phase two where you grow the patient population that are getting that dose and then a phase three trial where you’re talking about hundreds but potentially thousands of patients what’s happening right now is these companies and tech and biotech companies are working very closely with the FDA to continue that process but to compress the timelines so for example we saw the majority of vaccine that went into clinical trial in March and in May you now have approval to go into Phase two that timeline under typical circumstances would be months potentially if not years and what that means however is we need to watch and follow the safety profile of these vaccines very closely over time as well as efficacy for different populations. In addition we have seen a lot of companies large companies as well as organizations like the Gates Foundation that have said we will go at risk to ramp up manufacturing concurrently with clinical trial development so we we have a commitment of that manufacturing of products in trials are already starting that as soon as we have an FDA-approved product or even potentially very promising data come out of phase 2 trials, we may have emergency use authorization that says we can get this this product out to the general public

or to front frontline workers while we wait for additional data to come through and that’s absolutely critical because vaccine manufacturing is a very complex process that takes quite a bit of time to certify the manufacturing sites which are all over the world and depending on the nature whether your DNA or RNA or an attenuated vaccine or with an at revant there a number of different scientific mechanisms it can also delay the manufacturing the very complex manufacturing process having that commitment to spur manufacturing concurrently with clinical trials I will say it would be a very big game-changer here the other thing to note is that we have a lot of collaboration that is happening across both treatments and vaccines unprecedented level of collaboration with both public and private institutions that we have met we have we saw during the time I would say of HIV though happening at a faster and faster pace that we saw then we’re seeing collaboration within even the scientific academic research institutions where institutions that typically will not share data or share invest investigators are doing so in real-time in an accelerated way. The last comment I’ll make before pausing for questions is testing the question of testing which I’m sure you all are dealing with as well from a testing perspective surely the gold standard continues to be PCR tests these are the tests that are provided when you go to a healthcare institution where a health care worker with the appropriate PPE are able to take that nasal swab that’s actually very deep into the nasal cavity in order to perform the PCR test which is highly sensitive and can confirm with a high degree of accuracy that you have in fact been that you have in fact the virus and can give you a firm diagnosis we’ve heard a lot around serology tests or antibody testing which are tests event you can take to determine if you’ve had the virus and have sufficiently recovered and therefore you’ve built up antibodies in your body to prevent you potentially from a second infection the FDA in March issued that allowed serology tests manufacturers to develop those tests without an FDA approval what we saw was the marketplace was completely swamped with right now I’d measured about a hundred and eighty different serology tests with no confirmation if they work or they don’t work FDA has now gone back to say we do need to institute a review process here they’re now approving with a good degree of confidence those tests there are more accurate versus what has been marketed to the general public so following very closely the FDA approval for the serology test is important to to determine which can be helpful in giving us the right information to know on a scientific basis we do not yet have the answer to the big question of if you’ve gotten the corona virus and you even have antibodies in your body will you not get a secondary infection that question has not been answered so while you may have a serology test that says you have antibodies in your system we do not yet have data that demonstrates you cannot be infected in the future which is what you really hope to see to give people we call immunity passports where you can freely go in the public and continue on about with your business in that vein and NIH has launched a study which was announced a few weeks ago where there will be testing on a population basis the number of people who might have gotten the virus but were asymptomatic they’re using serology tests for that it provides helpful information to know the level of immunity within the population to determine whether we’ve hit herd immunity some of the results that have come back not just from this test from from others in New York City is that we’re about fourteen fifteen percent of the population has had the virus where you need about fifty to sixty percent of the population to have herd immunity so we may not we were successful in social distancing but what that means is that not as many people were exposed to the buyers we may not have that necessary hurried immunity therefore as we continue to open things up there’s a possibility for individuals to get the virus and to see infection rates continue to rise so what do we need going forward from our perspective we need active surveillance that includes testing that are in in

imbalance with reopening up different institutions and the economy we need contact tracing so that you can identify where the hotspots are emerging and very quickly start to implement social distancing in those localities and we continue to need the appropriate serology tests that can give us the right kinds of information so I’ll pause there hopefully that landscape was helpful and take any questions you may have Thank You Esther for that clear concise and factual information about where we are and where we need to go joy I’m going to turn it over to you to see if there’s any questions from the committee okay thank you Harry um we do have one question from Betty like stake controller Betty thank us they’re very much for the overview first of all I think it’s just really marvelous and really astonishing that there’s just been this tremendous rally around just all of this work and and I do have to say and I don’t know this is your take as well but seems to be a lot more cooperative as well in terms of just a lot of partnerships and certainly looking at our institutions here in California coming together as well. I just had a question, several days ago or more recently there’s been coverage in the news about the Coronavirus actually mutating into a more aggressive virus that could be more contagious bring on you know a second wave that could be even more devastating and so I was just wondering if these efforts that you’ve just described are kind of taking that into consideration or is this going to be a kind of an ongoing moving target yes I likewise have seen those reports as well and the jury is out in terms of how infectious differently so the now what we might see in the fall could be from a scientific perspective on the corona virus it does mutate but what we’re seeing in terms of the mutation it’s not mutating as quickly as you would see in other potential viruses one of the big challenges with HIV is how quickly it does mutate and which is really why we don’t yet have a vaccine so it is mutating but not at the increased pace that will prevent us from continuing to target the various therapies that are in development and in the works and so too you know that second question of are these efforts potentially going to not necessarily give us the right kinds of results because of a mutation with the virus, I would say that is being watched that is being investigated, but right now there is high hopes that what is being investigated can very much still be effective though we will see various strains potentially of this virus but the level of mutation is not such that it may not be it may be ineffective thank you. Thank You Betty Chris you had a question or some comments Esther thank you, my comments are about the the vaccine you used ,12 10, 12 to 18 months and that that was highly ambitious. One of our speakers opposed concerns about this upcoming election in the fall is there any chance of a vaccine by the fall I’m sure there’s a chance but should we just discount that that that’s just short of the miracle Well one it would be an amazing feat to achieve a vaccine in the fall We have as I mentioned earlier we have never seen a vaccine even under four years in the so what we’re trying to achieve here has actually never scientifically been done before so whatever the timeline whether it’s nine months or whether it’s 12 to 18 months will be a huge effort there are two places that I will point to you where there are high hopes that a vaccine could be developed by the fall there’s an effort out of University of Oxford in the UK that have shown a high level of efficacy in animal with their vaccine, and they are hoping to have a vaccine potentially be available by the fall vaccine efficacy in animal versus vaccine efficacy in human tend to be two different things. So I will say the jury is still out as we see the vehm ramped up in in in human studies which

has actually happened and and and and we will begin to get the data from that the anticipate data being available early part of the summer if that data proves to be positive they are already there part of that group cohort where they’re ramping up manufacturing so they’re closer I would say than others that effort out of University of Oxford it’s funded by the UK government it’s also funded I’m stuffy which is this coalition for epidemic preparedness who all they do is vaccine development so they were they’re good people working on it the second one I’ll point you to is Pfizer’s effort with bio in tech that started clinical trial they are highly ambitious about the possibility of having vaccines available by the end of the calendar year and also ramping up manufacturing they’re using a similar process as moderna is using as an mRNA vaccine which the manufacturing development if that can happen much more quickly because of the platform that that’s being utilized so that’s its whole quote madura is also hopeful there’s a lot of hope until we start to see the data and I think that’s where we should hare who should pay close attention we’ll get a better sense of that as we come to the end of the summer what the data starts to show for in human and I will say what really matters is in human for our larger populations so you may see good safety data for forty five healthy adults or 100 healthy adults it’s when you scale it to the thousands that you will be to see the efficacy and safety prove enough and one follow-up question I don’t understand the manufacturer of a vaccine you say that they’re scaling up but how long does it realistically take once once discovered to create hundreds of millions of doses? Well typically a manufacturer will scale according to the phase of clinical trial so if you’re doing a phase one study with a hundred healthy adults you will typically have the DOE supply in order to carry out the protocol for that study design you get the data you review that data with with your investigators with FDA you then put in an application for your Phase two trial you create manufacturing capabilities in order to be able to execute that protocol whether it’s a few hundred or a few thousand patients and then you continue on typically you will not go at risk as a company to scale up millions of doses if there’s no clear signal that you’re going to get FDA approval and and and so the timelines vary of course depending on how long are you following those patients in between those clinical trials before you ramp up manufacturing for your next phase I’m so seeing these developers with commitment from different funders to say that they’re going to scale up before you even get data out of good phase two trials that’s quite unprecedented. Thank you, really appreciate it. Thank you Chris. Gayle. Thank you and I also appreciate you being here in terms of that the treatments you spoke about, whether it’s the ideal I cry disappear or the some of the antivirals so you you made the point about HIV and thirty five years later not having a vaccine but the the treatment is is obviously has I don’t want to I’m out of my lane in terms of expertise but but is there how much hope is there in the treatments in in terms of really being able to fully open up the economy and letting people kind of go about more more of an you know at the new normal does that does that provide kind of the same level of hope in some ways as it did during for AIDS and HIV and how scalable are those products and in terms of manufacturing and the supply chains in terms of getting them all over yeah we have great questions and you raised a very good point which is exactly right that despite not having a vaccine for HIV because we have such good therapies on the market antiviral therapies for an individuals that’s come that are compliant with their regimen you can take before it used to be a cocktail really high stalks of cocktail the individuals took the AZT combo and others now you’re down to a pill a day that you can take that can suppress your viral load and keep it undetectable as you’re compliant with that medication and keep it undetectable to the point where you may not even transmit that virus to another another individual in

light of not having a cure for for HIV that in effect has allowed and created a lot of you know good you know course of treatment for patients that have it and has saved a millions and millions of lives similarly here with the corona virus if you have an effective treatment that can mitigate those patients that have the buyers getting severely ill as you see the data the vast majority of individuals either asymptomatic, or have a very mild case of the illness. But for our subset of the population that we’re learning increasingly more about, whether you have an underlying condition, whether you’re elderly we’re seeing something interesting happening with children we have to study that to see what what exactly is happening there there might be more severe cases if you can mitigate those severe cases you can prevent people from getting intubated you can prevent people from having to go on ventilators or needing even more complex care in the hospital because you have a great treatment regimen there you may create the same level of confidence that we have that it could get HIV there are good treatment options that are available to you the risk is not zero but it’s certainly you know better than what we have today again I do think that we will continue to learn a lot more as we see the data that come out of these antibody studies that are happening right now there’s a lot of hope for for the plasma that is either synthetic version or extracted from from recovered patients I worry about the scale the scale will likely only allow those therapies to be available to either the frontline workers or to those who are severely ill and potentially that might be all we we need in a way at the moment if others are prevented from getting more severe illnesses but what it will not be necessarily is is a prophylaxis a preventative treatment right it’s not something that you will take to prevent you from getting the virus it will be available to you after you’re already ill and potentially after you’re already hospitalized but if you give confidence to the population that there is something for you if that were to happen that creates a lot more confidence to go about in reopening our economy. Thank you Gayle If there are no more board members in the queue but Esther and thank you so much for joining us it was a really fascinating overview and I think I think it captures a lot of what many of us have been reading in the in press just one question I have you know I know we’ve we’ve talked about some of the either therapies or what what the outlook is like for for vaccines but when we also you talked a little bit about what we need in terms of potential contact tracing active surveillance you know there also is a conversation around how we balance our response to to the pandemic and managing it and individual privacy and confidentiality and I thought that maybe you know outside of the specific work that faster cures is doing but I just wondered if there are any comments you could share about that and where you see that discussion going yeah that’s a great question we do work on that in a different way when we talk about the role of big tech in healthcare and there’s already a consumer mistrust generally speaking with the use of their health data and then you live layer on top of it we’re now in this pandemic environment so that the questions about privacy continue to emerge I will say what we are now trying to balance is the need for privacy but yet being able to respond in an emergency situation where individuals may be more willing to have you know potentially a little bit more exposure on the privacy sign in order to mitigate again some of these things that we’ve talked about already there are contact tracing applications that are very conscious of that and are providing information in a de-identified way but when you’re trying to hone in on a hot spot and then localities increasingly you are going to at some point deal with real live individuals at the end of that who whose data are being provided to there’s not a clear answer there and what that right balance is it’s it’s certainly a trade-off I think those trade-offs are being well managed by different technology applications like Andy identifying individuals but this is very much something that means

happen at a local and state public health department as they are really those at the front lines of managing where they see emerging clusters of the virus and and I think all of us are socially responsible and can determine our own risk tolerance for taking that up and sharing our data on that app that allows our local officials to be as effective as possible thank you yeah I agree I think it’ll be interesting to see how that discussion proceeds because I think it um some of those issues are ones that people raised as we’re also talking about how to reopen the economy return to work travel get clearance to travel things like that um Harry we are we don’t have anyone else in the queue I’ll turn it back over to you Thank You joy thanks everyone for your questions and again Esther Thank You first US spending some of your day with us today and I remember when Magic Johnson was I made his announcement and of his illness who was a death sentence time and it’s people like yourself and organizations like faster cures and investors who invest in life sciences that go about saving in a race to save other people’s lives and that renews my hope in humanity and I want to thank you because you’ve renewed my hope in humanity the organization faster cures renews my hope in humanity and at our last investment committee when we met in person we spoke about an investment that CalSTRS has made through a private equity relationship that we have into the life sciences in terms of trying to find some breakthroughs in in cancer research he’s gonna say something really amazing right we’re right at the great place of kids or in cancer research which of course the Milken Institute through the prostate cancer foundation have invested in for many many years and have also turned the attention of that foundation to looking across the library what was effective in cancer that could be effective for this virus as well so researchers are working certainly around the clock we missed her last minute or so hairy sorry well no it’s just you it’s the investment in humanity or if there are a lot of good people out there doing great work and one of them and so is faster cures so thank you so much good thank you for having me have a great rest of your meeting thank you back to you Chris Harry that was 6a do you want me to go into 6b or do you want to go back to number 5 yeah 4 to 6 feet okay that’s the chief investment officer’s report for the public’s case you can see within the report that the portfolio stood at 243 billion back on March 31 apartment february 29th that was before the market continued to decline but now obviously is for in april we’re back in that better position and what is probably surprising for many people as the portfolio is pretty close to where it started the fiscal year so our return to date is pretty flat if you look at a return on the chart going into February we were actually up at a 10 percent return we saw the portfolio obviously drop almost 20 percent that but then rebound 10 percent so we’re very much in a flat position as we have two months left to go in the fiscal year we’ve heard from experts that this is certainly going to be a rocky road I had shared with the board in closed session that you know the bull market that lasted 11 years was ended in on late February we’re now in a bear market even though we have seen a strong rally in that bear market we’re still in a recession and as we heard from we’re still a long way for a solution to this health crisis so the market rebound has been nice to see but we are a tad more skeptical the asset allocation remains fairly defensive and we’re going to continue to hold our cash position and be underweight global equity at least through the summer until we hear more information about the medical breakthroughs we’re at a point where obviously the challenge is with States opening up whether we’re going to see more infections clearly the public is reaching its limit in terms of shelter

at home and you’re starting to see push backs on that in many parts of the country if we do see a resurgence of the virus in the fall as is likely the the case I think there’s going to be a risk about how much people in society are willing to go back to shelter in place and that’s going to be a challenge for governments in that cycle when you look through the risk report and I’ll have part of the team mentioned that one thing I wanted to highlight that’s rather unusual on INV 34 we’ve actually seen the emergence of two emerging market stocks into our top ten our top 10 stocks are usually us-based but now we see Samsung which has been their South Korean company has been in a top 10 for a while but Alibaba the first Chinese company to show up in the top 10 of the global equity portfolio and even though you can see on the preceding page imv 33 that China is a very small part of our portfolio it’s a little about about one and a third percent but some of the individual stocks in that have a very high capitalization and it’s a reflection of the fact that the market has been very concentrated in what I call shelter-in-place stocks Alibaba obviously being the Amazon for China and but just in the USA Facebook Amazon alphabet Google Netflix even Microsoft have all done extremely well in this environment and I had shared with or that those five stocks make up now almost 20% of the sp500 and about 17% of the Russell 3000 we’ve seen that kind of concentration in the past but it usually doesn’t stay historically those companies come back down in value right now their price to perfection because that’s the services were all using and it’ll really depend on how this economy opens up for us at the staff level the real challenge is they were able to stop the economy almost on a dime but how do you restart it and it’s gonna get back to a lot of individuals you know I heard that movie theaters in Texas are going to open this weekend how comfortable are people going back into movie theaters going back into a hair salons you know and I think the real challenge obviously is going to be to the airline industry when are people willing to go on airplanes now you’re required to wear a mask the entire trip you know I think it’s going to be a while before we see even if the self chart home orders are lifted in some places some people are gonna be eager to get out of the house and go places other people are going to be more cautious and so I think it’s going to be a slower pace unwinding I have heard anecdotally many times the comments from people that they don’t really want to go back to the office they don’t want to go back to work they like staying at home and working from home and so I think you’re gonna have a pushback from the public of a rush back clearly there will be some industries where people want to get out and go to places but I think we’ll see more of a stumbling out in the recovery and that’s really the challenge for us that the staff is trying to figure out with this rally in the equity market and then what we’re seeing in GDP numbers going into June and and into the summertime where is the economy going to be are we going to continue to be in a recession as Stephen McCourt said to us recessions don’t last days or weeks they last quarters, the good news is bear markets generally don’t last more than about nine to 18 months, this isn’t a multi-year challenge but we still think that the market is we will consider it that we’re in a bear market and likely to be in a trading range. I think that we have concerns about how we do here in the summer and then especially as we get into the fall do we see a resurgence of the virus, how does that affect retail sales consumer activity in the fall and then even more importantly how does it impact the US election is at some point the economy will turn ahead and start looking into the election and the uncertainty there of whether we’re able to vote in person or whether it’s mail-in voting with that I’ll turn it over Scott do you want to add some information? oh I was just gonna say no Chris I think you covered up it all thank you. Okay with that I’d also like to bring in Geraldine and Josh to talk a little bit about the report hello Geraldine Jimenez, Director of Investment

Strategy and Risk, I did want to highlight the risk report Chris already just mentioned it, but we want to highlight a couple other areas particularly in these uncertain times I think it is good to know that this team is up and running they oversee the risk in the portfolio and not only provide that’s my committee every meeting this report we provide reports the internal Oh senior leadership as we’re making teams as the RAC makes decisions you’ve heard that name a lot risk allocation committee as we’re positioning the portfolio and the risk is not just the risk of the volatility and the expected returns you know which we do monitor there’s also counterparty risk we monitor which is those we trade with their quality their ratings we monitor the leverage in the portfolio the total fund and we also monitor the liquidity and do modeling on liquidity and as has been said a couple times cash is king I do want though to tell the board and all of the members that are listening we have an iamb 38 page 38 we report every board meeting which shows our ability to pay benefits and so you should feel confident and comfortable we monitor that we are very comfortable in our ability to pay benefits while we talk about liquidity we now take it to the next level how can we have extra liquidity to be optimal in the portfolio and to take advantage go up to use when they show up in the rebalance so we’ve had a long-standing part project since last summer we actually got ahead of this thinking about what do we want to do in the dislocation and so we’re feeling comfortable I don’t want to be overconfident because you never should be with all the uncertainty out there that we feel comfortable with our review and our consideration of them so now I’m going to pass it over to Josh Cedars who leads the risk team and he’s gonna talk a little bit about volatility in the markets great thank you so we have a chart that we put in to this risk report every for every meeting and thankfully most of the time there’s really not much to say about it and so there’s a chart on inv 36 that we call market turbulence and I really like to start because it takes some pretty complicated relationships and a lot of information and condenses it into one pretty simple visual and the way that we interpret this is is to get a sense of you know is what we’re seeing in the market normal or is it abnormal in terms of the moves for staying could be the size of the move so if the market is moving a lot for things that should move together are they moving together or not moving together and so the simplest way to look at it is if you’re below the red line that you see on that chart you’re in normal territory if you go above that you’re you’re abnormal so markets are moving differently or they’re moving a lot more than normal and the farther you get away from that red line the more abnormal it is so if you look at that chart 11:00 there you know we’ve heard allusion to the unprecedented speed nature of the move we’ve seen in the market this is sort of the visual evidence of that if you will with you know that scale we saw moves particularly in late March that significantly exceeded the volatility we saw even in the great financial crisis and a lot of that really was just the speed and magnitude of those moves and so I think when we we talk about it and we sort of felt it but this is kind of taking everything that we see in the market all sorts of different markets equities foreign currencies interest rates everything and sort of condensing all of those moves into one single picture and and the bottom line of that was it was truly unprecedented by a significant margin at the same time given the even with that volatility thinking back to the AOM that we finished last year, this chart sort of gives you the context that the market moves by putting it in the context of what we expect out of the portfolio long term you know we would expect given our capital market assumptions and the portfolio structure that the portfolio would lose value about once every four years and so if you know being sort of flat now I think is well within sort of the expectations the types of things we would expect to see longer-term in the portfolio and I think as we’ve alluded to you know sort of is is a good even given the magnitude of the moves you know the testament to the

diversification of the portfolio and other things that we’ve done that that it really is basically flat now year-to-date I think I’ll just maybe pause and stop there but I just think this is a pretty helpful visual Thank You Josh and Geraldine and Chris when we go to questions at this point is that okay Chris yeah joy I’m going to turn it back to you for the questions sure no problem Harry first question is from Bill thank you Joey I appreciate it on that chart that you just referenced chart 11 you’ve got the outlier distance what is that what are the elements that are composed in the outlier distance so we we use that as sort of a term to measure if you a way to think about it is if if you expect you know the stock market day in a day to move you know up or down 2% and it moves 10% you’re pretty far away from from that normal that normal move and essentially that distance is how far away are you from normal moves so the higher that number the more the far away you are from what you would typically expect to see with respect to just the day-to-day volatility in the market it’s probably the simplest way I could think to to sort of understand that that number so I mean this past March you know compared to the global financial crisis we were twice as far away within it at the highest point is that right that’s right yeah yeah that’s correct okay thanks I think the thing I’d add you know from an investment staff perspective after the ’08-09 crisis we talked a lot about the shape of the recovery and we’ve already mentioned that a few times today is this a u-shaped recovery you know right now the stock market is showing you a v-shaped recovery that by the second quarter brought me the third quarter starting in July that will suddenly be all back to normal and everybody will be getting on airplanes we’ve heard people say it’ll be more of a u-shaped recovery where it will have a flatter bottom maybe through the summer before we get back into the into the fall but then there’s also the risk of it being more of an l-shape recovery and especially with Esther’s comments about the timeline on a vaccine I think that that the markets aren’t expecting it to be more drawn out they’re not expecting it to be a resurgence in the fall and we’ve heard different scenarios and the risks that we may face and right now the market is pricing in probably the absolute best scenario in a v-shaped recovery as we’ve shared with you from staff perspective we’re skeptical of that we are hoping for more of a u-shaped recovery but since this is a medical crisis and the medicine forward is social distancing it is uncertain how long this will take for the economy to return and human behavior will we easily once restrictions are lifted will we go back to our same level of behavior clearly as Stephen McCourt pointed out with the volume of people unemployed companies are going to be slow to hire them back because they’ve had debt service during these last two months that they need to have a resurgence and pay that off so if employment is slow that’s gonna lead right into all those questions about retail sales as I’ve said before almost 70% of our GDP is made up of retail and if people aren’t able to to have disposable income then we’re gonna have a slower time coming out of this so our expectation remains that that it was easy to stop the economy but it’s gonna be harder to restart it sputtering doesn’t mean that it won’t restart but I think that’s really gonna lead into the questions about medical advancements and success otherwise we do run the risk as we’ve discussed of a real negative outcome of the resurgence in the fall the economy stays flat and in a bit of a recession you’ll have trouble with in Europe and the north and south dynamic you’ll have trouble in the US versus China relationship and that all unfortunately leads us right into the fall into the November election and questions about how you even hold an election if people are required to do social distancing so on one hand I have to say I can make a nightmare scenario that is something

right out of a Hollywood movie on the other hand Wall Street is you know thrilled and happy and everything is fine and and we’re going to be over this in a time or kind of a middle case where we’re gonna have to to work our way through this we can’t give you a hard probability on any of those outcomes that we know that we face them and so we’re gonna maintain the diversification the defensive stance in the portfolio if this equity market rallies up to 3,000 on the S&P 500 then we will have missed out on that but I think the volume of information that our fingertips tells us remain defensive and be cautious we’re not out of the woods yet so here if you’ll allow me I will put it up to Steve McCourt and Meketa if they want to make some comments. Thanks I’ll be brief because I think most of what I, Steve McCourt from Meketa Investment Group, most of what I would comment on echoes the comments that Chris and others have made so far a few points I want to highlight March was as as Josh highlighted in the risk report a particularly unusual month in the market with a lot of liquidity and a lot of extraordinarily volatile days as we look at returns through the end of the month and sort of seven or so weeks through seven or eight weeks through the bear market one important fact to note is that the relationship in returns across asset classes held pretty consistently with past experience and by that I mean given the magnitude of the drawdown in the equity markets globally being down between 20 and 25 percent for the quarter other asset classes behave the way you would model them to behave and so the assumptions that we use in our asset allocation analysis and that CalSTRS uses to support its asset allocation policy is bore out during this period so far anyway secondly I want to highlight that the degree of policy support provided to the markets already has far exceeded that which was provided in 2008 and 9 both in terms of the scale of the support from both the federal reserve and the federal government in the scope of support across various economic actors ,consumers and businesses, and certainly a large reason why the market has rebounded so significantly since the the trough in March was a function of that policy support Chris alluded to it already, but I do want to note that two things would cause us to believe that we’re far from finished with the chaos uncertainty and risk associated with with this market the first being that recessions when they occur typically lasts for a matter of quarters if not over a year they don’t last weeks or months and reminding everybody from the experience in 2009 it took our economy six years to bring the unemployment rate back down to five percent from the peak of 11 percent we hit in in the beginning of 2009 so job destruction tends to happen fairly quickly job creation has happened much much more slowly also market volatility once elevated as it has been tends to persist for a while so I think we and your staff are aligned with the belief that we’re likely to see more volatility before we’re out of the woods on this and the final thing I want to highlight is potentially the most lasting legacy of this period for pension fund investors may very well be the very low level of interest rates that have been created by the recession and central bank activity globally since the pandemic hit as we’ve discussed in the past low interest rates have a lot of implications on forward-looking returns

across all asset classes and so that’s a particularly important financial metric that we would encourage the committee and staff to keep an eye on as we evolve through this period and with that maybe I’ll hand it over to Allan Emkin to say a few words as well Mr. Chair, members, Allan Emkin, it’s good to see everyone again, I would just like to underscore the commitment that your staff has made to continue the day to day job and an extraordinarily challenging environment making sure that vessel policy was complied with that the assets will prudently continually put to work that there was adequate liquidity in the portfolio and that all that was managed remotely in an almost seamless manner and the credit goes to Mr. Ailman and and Scott Chan and the whole investment team for not missing a step taking advantage of opportunities that presented themselves taking profits where they were created in the RMS portfolio and redeploy those assets at better prices in the equity market really is no precedent for what they’ve accomplished and I just want to commend them for that activity thank you very much. Thank you Allan I don’t know if there is anything else stuff from staff or was there anyone else that you wanted to pull in on to this portion no Harry that’s it really just to help the public understand the portfolio is is stable we’re actually really close to where we started the fiscal year at this point so we’re very flat on the year to June 30 we have two months to go so we’ll have to see how we trade for the rest of this time period but the diversification that the board put into place, the creation of RMS as an asset class is added value during this time period when equities have been so weak and we will have to see where we close out at June 30 to be able to determine how we do on the year, thank you very much Thank you everyone don’t see any hands up so why don’t we proceed directly to Miss Smith. Thanks Harry I want to Chris yes its Joy I’m sorry to interrupt Harry but I know we’re the next item was for to recognize Debra, I just wanted to flag there was a work plan the agenda item five I didn’t know if you wanted to cover that before we move into Debra That’s probably a good idea, thank you joy great idea so we’re going to go back to item 5 which is the work plan and as a point of reference each year the investment committee identifies a priority for the staff I had opportunity to speak with Chris and other members of the team and asked them whether or not they thought it was prudent and wise to put something on the work plan given their focus and where we know the majority of their time needs to be in terms of managing the portfolio itself that in and of itself is a full-time job we we embarked on a two-year work plan to look at the transition to a low-carbon economy and that work will continue into the 2021 year and beyond that will continue to be a focus so that’s a carry over into it as a two-year plan after speaking with others we believe that the adoption of a work plan one topic for the second half of 2021 which is really the study of Asia it’s on inv 20 and then inv 21 speaks to what the recommendation is so I’ll turn it back over to Chris at this point thanks Harry as you said we’re not done with a little carbon and future study we got part of the way done but we still want to continue to work with the Committee on addressing how do we want to tilt the portfolio how we want to look at companies about their ability to to frankly be flexible and to adjust as well as whether we want to put dedicated parts of the portfolio and maybe even tilt some of the indexes to

anticipate a low-carbon future I’ve mentioned in the past you have an investment belief that you believe the markets are highly efficient mostly highly efficient this would be a question oh because now we have an investment belief about climate risk do we think that the markets are properly addressing the risk of climate change and the potential regulatory impacts of that and whether we’re willing to tilt some of our portfolios in anticipation it would be a recognition of some level of active management but it wouldn’t necessarily violate your view that markets are largely efficient we don’t say they’re completely efficient the second topic is another area that I’ve been mentioning in our off-site discussions of couple of times which is really a shoe and the high-growth areas particularly obviously China which is very politically sensitive right now I’ve always kind of put it very simply as whether China is a friend or a foe it’s not that clear-cut and they’re probably both and they will probably continue to be both are they a competitor are they a partner or are they an adversary? And they’re all they are all one and if we’ve heard it’s probably going to continue to be difficult but I think it’s an area it’s it’s in our portfolio it’s part of the global indexes it’s really something that we need to do a bit of a deeper dive Karen Yamamoto challenged me with a question of you know what are the goals of these studies for you well that’s really up to you and what you want to do with each of these studies but I think in this one in particular it would be difficult to ask you to make a hard policy on Asia but I think what we can come to is given the ESG risks in that part of the world the fact that it’s a different different political system different accounting rules what are some of the due diligence steps some of the extra criteria you’d like to see staff do on investment opportunities in that region to help protect fun and and how do we look at that long term in many of the investments they’re going to have a high growth because of the population and the demographics but rule of law is different political system is different and so how do we look at that and obviously the u.s. relationship with other partners around the world changes over time so I think it would be fascinating I’m hopeful but hopefully we’ll able to get it done in the spring time of 2021 obviously depends on how we’re able to hold meetings but I think we have several very exciting guest speakers lined up with other experts in this area that really can present kind of a true global and a long-term perspective on Asia and the growth of Asia thanks Chris we’ll open up to any questions or comments there is a recommendation on inv 21 for your referees um Harry the so there aren’t there just looking there aren’t any board member board members seeking to speak I think I would just you know lend my support to the plans yeah and I think all of us know throughout our conversation we’ve talked about how much uncertainty we have with with what the future holds we know how to pivot we know how to be resilient and and you know focus on things differently if we were to to need to sure so we’d be entertaining a motion that if we could someone make a motion to disagreement its joy I’ll move approval it’s done it’s been moved by joy eager seconded by a controller he to approve the recommendation on inv 21 relative to the work plan and the accompanying work plan for the upcoming fiscal year on ie 22 and 23 any discussion come on do we have to do a roll call on that? Yeah we should do a roll call vote on that. That’s what I figured Marking senior counsel to hear to take the roll on the motion to adopt the fiscal year 2020-21 normal workplan. Controller Yee, aye Mr. Yamanaka, aye, Mr. Prazant, aye, Ms. Yamamoto aye, Ms. Bradford, aye, Ms. Hendricks Hendricks, thank you, yes aye, Ms. Miller, aye. Mr. Keiley the motion passes. Thank you Mr. King You’re welcome, brings us back to item 6c that’s in Charlie, this is the recognition of our outgoing Chief Operating Investment Officer Debra

Smith, I’ve been on the board quite a while Chris I’m going to turn it over to you thanks Harry and thanks Jonathan for bringing up that lovely picture I’m really glad that we’re able to take a moment today to to recognize and honor Deborah she is announcing her upcoming retirement as I have told the board I am pleased to say that after taking some time off in May Debra will rejoin us as a retired annuitant to help us work through the summer through this transition – we’re back hopefully at some point into the office so I really thank her for adjusting her personal own family plans to do that Debra has over 40 years of experience in the financial services industry and as you can tell by the picture she started about the age of 10 Debra has about 24 years of experience with the state specifically with CalSTRS she started her tenure at stirs in 1996 as a member of the audits branch and two years later joined and transitioned over to the investment branch as an associate investment officer that’s a title we don’t even use anymore Debra quickly climbed the ranks to Investment Officer 3 in 2010 she was selected as the director of investment operations and then I’m pleased to say in 2014 she was hired to be our first chief investment or chief operating investment officer, our first COIO reporting directly to me and part of the senior staff and senior leadership Debra’s had some incredible contributions to the investment branch she’s been part of the executive staff for Jeon Jack’s team she’s represented the branch and and the board strategic plan the enterprise risk management as part of her duties as CEO IO she oversees investment operations she has created our investment compliance and performance unit and she oversees the administration unit within the branch I think when I look back at probably most proud of Deborah’s accomplishments really as Harry mentioned was pioneering and helping put together our investment cost report allan emkin has mentioned that that is industry-leading is one of the most comprehensive cost reports in the industry I gotta give credit to Paul Rosensteil all a former board member was the one that pushed us pretty hard to put that report together and I’m pleased to now say it’s a report that we used pretty extensively across the investment branch and and you guys have found incredibly valuable so thank you Debra for helping spearhead that effort to put that whole thing together it was a it is a major undertaking in 2016 Debra was appointed to the Public Committee Accounting Oversight Board, it’s a long word but the PCAOB standing in advisory committee she represented institutional investors that’s a group that it meets in Washington that’s a subset of the SEC and is really important also in 2016 and I know she was really proud of this Deborah received the leadership in Business Award from the Sacramento chapter of the National Coalition of 100 black women Debra has been a powerful mentor and leader to so many people in the branch and even to CalSTRS and to the community she’s made her spirit her integrity and her accuracy known to so many people I always told Debra that she is ideal in the role of the COIO because of her attention to detail and attention to accuracy I’ve been honored to work with Debra for 19 years that I’ve been at CalSTRS a tremendous number of accomplishments I personally have been very blessed by her presence so Debra on behalf of the investment staff I want to thank you for all your hard work your tremendous leadership and especially your mentorship to so many people on staff you know and we know that you will continue to be a super success in the next part of your career and if I can ask Scott Chan and a few of the staff that work for Debra, board if you’ll allow us that we’d like to make a few a make a few comments so stop yeah thank you Chris I think Debra you know that when you announced your retirement we’ve had an ongoing joke because the markets just falling apart right after that so is it COVID, is it because your retirement I mean I think it’s actually a pretty close call here I wanted to say that for me four words describe you Debra I’m just gonna start with the first three grace poise and professionalism so just starting with groats you texted me about two weeks ago and you you wanted to provide reflections for what was on your heart and what that manifested into is just one of the best meetings I’ve

had here at CalSTRS you went around the room and had a positive reflection for all the directors there’s such a powerful meeting and to me that that’s grace you know four point as for poise and professionalism let’s just put it this way this is your last board meeting and I think that you’re just as prepared for your last one as you wore for your first one and I think that what people don’t see but I see is that you were actually prepared for every single meeting and when it what a what dedication my last word and this is the best word is is mentoring mentoring is your passion and I think that you have set an example and been an inspiration to me and to a lot of the junior staff you’ve mentored a lot of our staff and so you’re part of this culture I think that’s going to continue to to live on and as Chris was saying you’re going to be wildly successful in that next endeavor which pursuing your passion of mentoring other professionals so I’m going to end with this I will cook for you and not even a pandemic who’s gonna save you for my cooking we’re taking a rain check on the retirement party and I’m gonna miss chip thank you Jack can I ask you to make a few comments that Debra and her leadership. I could make a lot of comments by Debra tonight I bet you never imagined your goodbyes via zoom this is a this is amazing experience to do it like this but I wonder would end with Scott’s comment Debra is clearly you uh you even though there’s a lot of training and thought that goes into being executive unfortunately it’s always hard to have the big picture and the vision in that role because you want to advocate for your branch advocate for your resources and everybody knows understand that piece of managing but for you you did that so well but then you also did the other piece which was advocate for the organization so as Chris said he’s thinking you and me have the branch I also want to thank you about all 1200 CalSTRS employees because they all benefited from your contributions because you helped shape the organization’s success these last years on the executive staff and you’ve been a good friend and a great executive as part of our organization and I wish you the best in retirement take care. Harry I’d like to call on three of the staff people that work directly for Debra all three ladies all three minorities, so let’s start off with April Wilcox hi um so I first met Debra at a Taekwondo studio doing kickboxing and let me tell you she can hold her own um she was focused and determined the same qualities I saw in her we started working together at CalSTRS which was completely coincidental by the way um you know the same thing that others have been saying Debra has been instrumental in shaping my career she really is a true mentor for 15 years here she has guided me challenged me and pushed me and she always gave me an opportunity to succeed and what I mean by that is you know if there was a chance to meet someone important she would invite me to join her if there was an opportunity to present she would ask me to do it and show up to support me she always had my back like Jack said she fought hard for her staff and she taught me one of the most important roles to some you know about it’s a 24-hour role and so that’s if you don’t know it if you’re emotionally affected by something wait 24 hours before you respond and I can’t tell you how much that role has helped me and not only my career but my personal life I am just one example of Debra’s passion to mentor and lets up women she devotes a lot of her time to diversity and inclusion and the importance of maintaining a strong culture we have here at CalSTRS so Debra you’re gonna be missed and I wish you success in your future endeavors I know you will continue to do great things. If I can call on Muriel Here I am there’s there are so many things that I could say about Debra, she has not only been an amazing boss but she’s been a fabulous mentor to me

since I have been able to work with her there have been many conversations that we have had no tears we have had that she has walked me through both professionally and personally I have been amazed by her strength in leadership not only as just someone who’s just intelligent in I’m passionate but someone who is passionate when it comes to specifically people of color and women of color in business and it has caused me not only to our conversations have not have caused me not only to gain more passion and what I do but it has caused me to like a light bulb to come on as far as how I would like to live out my passion and so I just want to thank you Debra for all that you have done all that you have shown this all that you have taught us and you’ll definitely be greatly missed Thank you, Muriel, I’m crying myself. Shifat Hasan Hi Debra, um I think your your retirement still feels very surreal to me because as Scott mentioned that ever since you announced your retirement everything around me has been surreal at a global level the pandemic the lockdown markets so on and so forth I’m not gonna say a lot today because this is not easy for me and it’s not going to be goodbye so I’ll keep it short I have learned so much from you in the past three years you’ve hired me from the financial services branch and the value you’ve added to my career by being a leader and not much of a boss but really being a leader with your guidance is truly priceless to me and for that I’m very very grateful um you’re a great mentor like I think we’ve heard that many times today and I think that can be repeated enough times you have guided me and you have challenged me to be better at everything that I do I’m truly inspired by your passion for diversity and inclusion and when I really think about it I don’t think I’ll terribly miss you after your departure because I’m going to carry those values are those inspirations that you have instilled in me and feel your presence all the time and thank you very much Debra for everything the entire investment performance and compliance team will miss you and we wish you all the best in your next adventure I know we had a lot of speakers so there but there were people are very impassioned by Debra and and really wanted to talk It’s amazing to say but there are three people on the investment staff that we’re here with all with Debea for all 22 years instead of all three I asked one though they to pick one which is Steven Tong to make some comments about Debra. Thank you Chris, Debra um I think it’s a privilege for me just to speak to you, and I think I feel sadness but also happiness for you and like Chris I said um I’ve known you for the entire Tidy billion investment office and it’s been a real privilege to get to know you before I begin like to share my thoughts I just want to share with you a quote from John Wooden and just find a way of background he’s the was UCLA head coach back in the 1940 to late 1940s through 1975 and over the years on when I look for leadership I’ve read a lot of his materials but I wanted share a deal with just a quote that he had and I think it encapsulates encapsulate who you are and this is the word success and how he defines successes it’s come coming to know that you did your best to become the best that you are capable of becoming I think that really speaks a lot about you and when I think about great leadership there’s really two things that come to mind and one is exercising the gifts that you were given from God and the second thing is investing your time in

other people and you have done both of those things so these are my thoughts and there are very few people who have inspired me in Debra you would have been one of those individuals, you are an excellent leader and it served California public teachers for 224 years left a penny at CalSTRS and the last five years as chief operating investment officer and as one speaking for the entire office we really appreciate just your leadership and how you really we see just your contribution to the office operations Debra is it you’re very confident and also displayed great humility it’s one of the aspects I really appreciate about you, you know very caring and selfless person and you know leadership is just not about yourself it’s about individuals you work with and the success that you share with their endeavors your selflessness has taught me a lot about sacrifice I know that you as a leader you’re also a positive role model as others had mentioned Debra you always made yourself accessible to others including myself I know that on many occasions we have private conversations and and so I appreciate each one of those ones that we had but I really appreciate one thing I appreciate about you is that you understand that great leadership is this not focused on us but it’s focused on others and that’s a lesson that I applied today as I learned to lead they will mess you appreciate you as a friend and as a colleague and I want to wish you well and you mix endeavors so I’ll turn it back over to you I see your hands raised. Thank you Chris, Chris did you have any other members of the staff that wanted to make some comments? Other than Debra at the end, I want to give her a chance to say goodbye. Okay thank you well I actually realized I made a critical error in in going after your your staff instead of before because um their remarks are hard to talk but I think you know I will keep mine really brief because I think the words that everybody shared have captured a lot of what I wanted to say about Debra you know Debra I think I would just say you know I want to say thank you for everything that you’ve done in your career at CalSTRS in the time that I’ve been on the board there’s elf there’s a lot that we’ve done that I’m extremely proud of but one of the one of the things I’m most proud of I think and reflect on is our commitment to inclusion and diversity and it’s not just the commitment that we have to inclusion and diversity when we look out but it’s also what we when we look in and the fact that we model that when you look at our board when I look at the faces on the screen in front of me when I look at our executive team when I look at tourists and you Debra and our investment team when I look at you know all of our staff you know we represent not just what diversity looks like but what diversity and inclusion can can help an organization achieve and we’ve heard a lot of people talk about the big role that you’ve played in doing that, I know you’ve been recognized by others for all your accomplishments there, you’ve clearly had a role not just on a policy level but also doing it individually with the mentoring and coaching that you’ve done I have really enjoyed getting to know you in the time that I’ve been on the board you know as a colleague as a leader as a woman leader and as a working mother because doing that juggle is something that I think working mothers are often the only ones who understand so I just want to say thank you we see the best in your in your next chapter although I’m glad that your next chapter I think will continue involve CalSTRS so we are we’re lucky to be a part of that, but thank you Debra do you want make some more she goes yeah Debra yes I want to thank you for all that you’ve done for CalSTRS for our members there are very few people who can you know capture my attention on such a wide range of topics like risk reports and cost reports and all the issues that you oversee in terms of making sure we’re in compliance and then pivot and ask me if I’ve been to what am I doing with my daughters and that that

that’s I have a lot of respect for anyone that has that type of ability to have a range of conversations that are truly important and meaningful and I’ll always have fond memories of when we were in New York seems like a long time ago seems like a lifetime ago it was cold it’s December we’re going to an event at the library the Schwartzman library and you had asked me if I knew how to get from 40s where we want 41st and 7th or something and could do how could I help you and I think Geraldine was with us and June may have been with us as well and I thought wow I can be useful I can walk them across and get him to the Schwartzman library on a cold windy New York December evening and it’s those types of interactions that for me for me are really valuable because at the end of the day the in organization is only as good as the people in it and you are your great human being you’ve served this future. Thank you very much, thank you Harry, thank you Joy, Chris Ailman I was here before he started and I knew that you were gonna be a great CIO for us personal and professional you stretched me and I thank you for that Scott haven’t worked with you as long as Chris but I am looking forward to tasting all the food that you post on your zoom pictures Jack I want to thank you and Cassandra or encouraging me to take the executive development program that was instrumental in my career thank all the executive staff I think all the investment branch staff we have a great team we are a family and like family we get along and sometimes we don’t but we do use that 24-hour rule and we come together and we’re able to manage this portfolio Thank You April Thank You shafaat Thank You Muriel Steven Tong you were here when I started and you’re still here and you’re just a great friend and I’ve got to know your family as well so thank you so much to everybody I’ve had a very rewarding career here at CalSTRS I love working with people I love helping people especially teachers and it was Chris edit you know the COIO position was made for me, I love my position I love my job so I will be here in a different capacity through the summer time and one thing I know about the investment branch and one thing I know about CalSTRS is we know our mission we know our members we know our families and we meet we work very hard to accomplish those goals and objectives and they will continue to do that as a team a quote that I just wanted to leave you that just kind of sums up is Maya Angelou quote my mission in life is not merely to survive but to thrive and to do so with some humor some compassion some passion and some style so I want everybody to keep calm, stay classy, stay healthy and stay safe, thank you. Thanks Debra. Chris this brings us to the review of information requests, I don’t believe we have any requests for information if we did ask Lamont, let me know, ok don’t. Item 8 is a draft agenda for the next committee member committee meeting, it’s I would say more likely than not more likely than not, that in July we’ll be meeting remotely as well and you can review what the draft and it may or may not be modified between now and then depending

on what may occur so it’s there I don’t know if you wanted that ain’t had anything else there Chris no I would just highly ously we pushed a lot of the important work from this meeting not knowing how virtual meetings were off to July and it may obviously be as well virtual but will we we do have one guest speaker so we’ll time that properly and then we do have some important details to get through and as I mentioned we’ll bring you the investment policy because I think we’re ready to move step one on the asset allocation long term plan that’s it. Okay thanks Chris I don’t see any hands from members of the committee, clearly Sharon and I will be speaking with Jack in terms of pacing and timing and our ability to stay focused and it will learn some lessons from this and we’ll make some changes in my fly around timing and pacing so we do I just received a message that we have members of the public here to address the board there are three members I believe of the public that wanted to speak item five so they’ll have three minutes each and then we’ll hear from members of the public for items that do not appear on the agenda and that will all be facilitated by our staff with a maximum of 30 minutes for non agenda items of no more than three minutes each so with that I will go to public comments for item 5 which mine is saying there’s three members of the public three minutes each. Hi Harry we have actually just two members of the public for item 5 now and I’m gonna bring in our first caller, her name is Paula, thank you Bryan. Hi I’m Paula Buell I’m a retired teacher in a CalSTRS member I want to commend CalSTRS and the board for the focus on a low-carbon future in the work plan I understand that the presenters at the October to 2019 off-site made a strong case for a transition away from carbon producing industry so you already know global warming caused by carbon pollution is wrecking havoc with our environment human life and the economy worldwide when I last spoke to the board I mentioned the danger of holding on to oil and gas until it becomes worthless we’re seeing the weakness of the fossil fuel industry now in real time as the economy reacts to the Cova 19 crisis I urge you to create a divestment plan and act on it immediately any delay will only increase the damage to our pensions the global pandemic should be a wake-up call for the changes yet to come as climate change will also cause disruption to and opportunities for our economy the work plan can and should focus on creating a roadmap for fossil fuel divestment and guiding CalSTRS to invest in a green just and sustainable economy our pension money can be used to support development of alternatives such as carbon sequestration advanced batteries and clean energy and maybe there will be even opportunities in Asian markets for those kinds of investments that’s what we current teachers retired teachers students parents community members and taxpayers want for our pension funds CalSTRS position is a large and highly regarded pension fund places you in an excellent position to leave the transition to adjust for free economy thank you. Bryan I believe we’re ready for their next speaker next caller is Vanessa Vanessa go hair on the line hi my name is Vanessa warheit I’m the executive director of fossil-free California and my mother who lives with me as a CalSTRS retiree I was at the October off-site which began this year’s study of a low-carbon future and I’m delighted to hear that you’re continuing this work but I’m also concerned that you’re operating on a timetable that denies science and that you’re continuing to bleed CalSTRS members precious savings into the dying tar sands and fracking industries in particular so the benefit of any teachers listening today or later on watching on YouTube I just want to point out that over the past year CalSTRS has lost over a billion dollars of your retirement savings on investments in fracking and tar sands alone and that number incidentally does not reflect losses from the day when oil was trading at negative 37 dollars a barrel these numbers come from the equities in

CalSTRS passive portfolio and we understand that the passive portfolio gets the lion’s share of the fund because data shows that markets do better ultimately than in two visuals in terms of performance and trying to pick winners and losers is in the long-term usually a living bet but as Chris Alan Reece just pointed out you know sometimes markets aren’t quite as wise because they have like significant blind spots and I just want to mention the S&P is not the only market index out there there are tons of data now to show that fossil-free indices are increasingly outperforming the market even more data shows that there are plenty of fossil-free indices that you could be following instead and if you really wanted to there are plenty of ways you could just hug the S&P returns with a fossil-free portfolio so on behalf of my mother and all the teachers of our great gated really prefer it if you outperform that benchmark at the moment so I’m here to ask you please shift calstrs index to one that excludes an industry and secular decline that is poisoning our communities and threatening the future of our students at that October sight Alicia’s vigor both plainly she told you climate has canceled business as usual and to invest as usual is to get to take a bet against physics so we need you to stop betting against physics and shift our money now to investments to build a safe Green recovery and start earning our hard-working teachers a decent return then lastly I’m just confused by the proviso that the work will last until January 21 if the committee can return to traditional in-person meetings what if they can’t does that mean you’re going to kick the can even farther down the road we know these are difficult times that teachers have been able to rise to the challenge radically restructuring how they teach and we expect no less of CalSTRS so please prioritize and accelerate this deadline to address the urgency of the climate crisis only being compounded by the COVID pandemic and divest now from fossil fuels, we’re counting on you, thank you brian is that conclude public comments for item 5 that concludes public for public comment for item five correct and we have our next caller her name is Diana. Thanks Bryan How many callers do we have on this item Bryan? We have seven callers including Diana. Okay thank you, three minutes each thank you Bryan hello, I’m a retired teacher and a member of CalSTRS, at this time oil riskiness as an investment and oil company executives and their allies in the White House are clearly colluding to prop up their dying industry. One of those executives, Lee Raymond the former CEO of ExxonMobil and its predecessor Exxon is that for re-election to the board of JP Morgan Chase CalSTRS now has a powerful opportunity to truly make a difference using your strategy of engagement to support ESG policy and in reference to the current crisis the Cova crisis we know that population is suffering from the toxic effects of fossil fuels are at higher risk for the worst effects of Cova 19 calpers and calsters are the third and fourth largest pension fund share owners of chase JPMorgan Chase is the largest funder of the fossil fuel industry pouring more than two hundred and ninety six billion into fossil fuels since the 2015 Paris agreement Lee Raymond has been lead independent director of JPMorgan Chase since 2001 CalSTRS please join officials from New York State New York City and Pennsylvania to urge a no vote on Lee Raymond’s re-election to the board of JPMorgan Chase at its AGM on Tuesday May 21st as well please ask pers and sters to urge large chase share owners Blackrock and State Street to vote no on Lee Raymond’s reelection, thank you Harry, our next caller is Rio. Thank you Hello I’m Rio with the earth Guardians Bay Area crew you probably recognize my voice because I’m one of the students who has been coming to your board meetings for over a year now I and other students and teachers have been on hold for almost three hours and a half and I asked you not to shorten our speaking time thank you so I really feel tired and frustrated because we’ve

been asking you to put divestment on the agenda so it can be discussed but you keep refusing so even even today and the CIOs report the value of your fossil fuel investments wasn’t mentioned you tell us we should be patient but the impact of this pandemic is nothing compared to what we will face from the spreading Quran that Christ what crime it crisis well I guess you got upset when we pointed out that we read that in 2017 the CEO and CIOs of CalSTRS each made about $800,000 in just one year while choosing to give billions of dollars to a fossil fuel industry even with your CEO making so much money he didn’t keep his promise to reply to our questions that one of our adult coordinators was emailing about that’s not okay last week I watched a really hard but powerful movie it was called Virunga and it’s on Netflix it explains the story of a Wildlife Reserve in the Congo it shows how an oil company has been a fueling war just to get land for oil in Germany including inside the reserve there was so much corruption and the company paid groups to do really horrific things to the people who lived in the area and that tried to protect the land of the animals I feel really overwhelmed and disgusted after seeing how people are actually getting bribed and killed so companies can get oil out of the ground and into our cars the company’s name was SoCo international I googled SoCo and calsters and found that on near June 30th 2019 list of international equities socool international was listed the company recently changed its name and even says that they are about sustainable growth they left Congo but continued to do really horrible things in other places but this is just one story of so many of the fossil build companies you are rewarding with our teachers money I’m outraged that you keep saying your engagement strategy it’s actually a solution our earth Guardians group is partnering with youth activists in Congo who are getting hit with climate disasters are ready in the varuga region they used to see floods in about 12 villages but this year over 84 villages were flooded and they’re getting a second hit of floods right now they lost their schools clinics medicine and most of their crop mean putting money into fossil fuel companies there is a clear line drawn in the sand on one side are indigenous protectors frontline communities youth and everyone working to keep the oil on the ground on the other side are the climate deniers fossil fuel companies with CalSTRS pouring money into their mouths to keep them alive when they clearly are the ones meant to be dying my main question is today are you finally ready to step up into the Periyar Megan hello thank you for allowing me to speak my name is Megan and I’m a third year at UC Davis I loved what someone said earlier on the call with respect to the corona virus vaccine which was that his faith in humanity was restored by investing to save other people’s lives I’m here to ask you to divest to save other people’s lives burning fossil fuels is related to the carniverous in three ways one fossil fuel combustion leads to the very respiratory health problems that are making the corona virus lethal also climate change is increasing prevalence of viral infections according to researchers I UC Davis – so climate crisis itself is causing immense loss of life which will worsen heat diarrhea childhood malnutrition disasters food shortages and vector-borne diseases are among the effects of the climate crisis 3 the economic impact CalSTRS has lost more than 19 billion dollars from fossil fuel investments already and the World Economic Forum considers climate change the number one threat to the global economy which relates to your earlier discussion about adjusting a portfolio and consideration of climate change more personally in my whole life I have known I wanted to be a mother now at 20 years old every time I consider the possibilities for my future I confront the projections for our world the food shortages throughout disasters and youth itself I am heartbroken that fulfilling my dream of having a family could be unethical how could I bring someone into a world of such chaos please save us to save other people’s lives so that I might have a family someday

please make fossil fuel divestment a topic for your July agenda Our next caller is Jay. Jay go ahead, you’re on the line. Hello hi my name is, I am 12 years old and I am a part of the Earth Guardians Bay Area crew, we ask you questions and marks that you still haven’t answered two of them were really important to be answered before May one of them was if you will vote against three Raymond being on JP Morgan’s board at the annual JPMorgan shareholder meeting in May he doesn’t even believe in climate change do you still want to support him on the board when will you answer the rest of our questions I come to you today with another question are you going to choose my future or supporting fossil fuel companies we need your money invested in clean energy on this call right now there is destruction happening all around me because of this pandemic the one thing that sometimes brightens my day is going out walking around and seeing the beautiful nature have you seen before and after pictures of skies and places like India and China because of the decrease in Volvo fuel consumption skies that used to be so polluted you couldn’t even see the sky are now clear because of less fossil fuels being used people are able to breathe better because of less fossil fuels there is less destruction this illness is something that I hope will never happen again but this destruction if you don’t divest will this destruction will be the result of climate change let’s face it engagement does not work the whole company is fossil fuels it embodies the destruction of my future embodies the destruction of the you future your children’s future when I am old and my grandchild asks me why why didn’t you stop the destruction I’m going to be able to answer I tried I tried to help and save you and I tried to keep this destruction from happening but will you well the heavy don’t but you don’t do as much as you told weigh on your shoulders you can tell yourself that engaging in fossil fuels for the your engaging fossil fuels for the right reasons but you’re not when you have grandchildren and they ask you the questions that they ask me you won’t be able to say that you did all you could because deep inside I really really believe that you know giving money to fossil fuel companies is not right please listen to it listen to that little voice inside your head telling you that it is not right no matter what your position is and be brave speak our next caller is Joan Joan go ahead hi there thank you for taking my call we have been waiting on the line for almost three hours my name is Joan Lowe and I live in Oakland I’m the 76 year old spouse of a CalSTRS retiree and I’m calling today to urge the board along with the voices you’ve just heard to put divestment from fossil fuels on that July agenda it needs to be brought forth when cities like New York and London are moving to digest when huge universities like the University of California have voted to divest when science tells us that we must leave 80% or more of our fossil fuel in the ground to avoid further climate catastrophe when youth like the ones you heard from today around the planet are lying down in front of banks and lying down in front of CalSTRS begging with their bodies for institutions funding fossil fuel in communities of color and other marginalized communities suffering from the toxic effects the fossil fuel extraction on their air water and land are disproportionately impacted by the coronavirus when fossil fuel stocks are plummeting along with

the demand why why is CalSTRS dragging its oil drenched heels on this issue that carries so much financial as well as climate risk for our teachers for our pension fund for our planet for the sake of my 14 great nieces and nephews who will inherit this planet in whatever shape we leave it please act swiftly wiggly and with courage to move the divestment question to your July agenda. Thank you the next caller is Rick. Rick go ahead, you’re on the line Hello can you hear me? Hi Rick we can hear you. OK, you can hear me, I’m a teacher a teacher for 30 years a member of the United Educators of San Francisco and I currently retired and receive my paycheck from CalSTRS. My field of economics and I would like to tell you that it is true that this crisis is unprecedented however it was not unexpected there are people who have been talking about pandemics for years and have said we needed to prepare for pandemics so this is unprecedented but it’s not unexpected I’d also like to point out that we’ve had two economic crises in the last of less than 12 years so you better be prepared for more economic crises because they’re going to come and furthermore they will come with a climate crisis that is right on our doorsteps now a lot of people chose to ignore the scientists who said pandemics are a possibility and people are ignoring the scientists who say that climate crisis is a certainty so I would like to ask you to protect my future not just my financial future my future to live and I would like to ask you that you put this on the agenda it has to do the top of the agenda I waited for three hours today to make a comment that’s not right that’s absolutely not right this is something that people want to talk about so I would like you to just hope I have the courage get rid of those those securities I will tell you Warren Buffett just dumped all of his airline stocks because you realize they’re valueless and you should dump all of your fossil fuels because they’re just as valueless so please listen to that very eloquent people who spoke before me I know that you people are hard-working I appreciate that but you’ve got to really undo what you’ve learned in in college and start looking at the real world and make some projections based on the real world and not on these economic and business are projections that really bear no relationship to reality yes I do have a rational market is nuts, thank you. And our last Magdalena. Magdalena go ahead you’re on the line. It sounds like you just kicked my brother my brother Rio and my oath Guardian friend you see off the call but you can’t censor us my name is magdalena I’m 12 years old and a proud member of our audience Bay Area crew I have been coming since last May with other youth and duel allies in a pandemic while entire regions and communities are starving and left to the side you keep giving money to companies that lie and cause destruction and are trying to get even more oil out will while everyone is focused on a pandemic I am hoping that you’re still playing this game with the fossil fuel industry why do you still want to engage with the fossil fuel industry when they are all about taking oil out of where it belongs the urgency and irony that you still think it’s fine and the right thing to support community is that the companies that fly off the backs of people and the planet the O’s can’t take any more of your engagement and neither can be the fossil fuel

industry can’t change their ways that’s their job to make money from destruction of indigenous sacred land and life the people and nature on the frontlines and you are needing you to stop and you are a cry wake up a nap indigenous leaders frontline communities science nature and the youth have been screaming but you still were you’re still wearing your green washing axe diversity including people to the tables is also listening to the ones living going to work and school on the front lines of the climate emergency because of environmental racism and classism my teachers are losing money and the youth are losing our future and home so why are you scared is to stand with your money for the truth for all and your future existence will be living with the mess you made excuse me to think of my future the virus is just a dress rehearsal for what is coming this is a warning we would be living with landslides floods storms and droughts. This is not the future my teachers want for me and other youth and you work for the teachers teachers work for many years teaching the youth but now without much knowledge or letting our future die and crumble you work for the teachers and the teachers teach us and we give up our childhoods the planet and future I will not end with hope I’m going to end with this as Eden somewhere IV a told us may the future has its eyes on you Harry that concludes public comment thank you Brian Thank You members of the public for your comments for your patience today as we navigate this new format of running a meeting we’ll certainly evaluate what’s the best time in the agenda to hear from members of the public so that you’re not necessarily inconvenience as we try to balance the business of managing the portfolio at the same time I want to thank everyone for getting through this agenda thank the staff Brian and the communications team that helped coordinate and facilitate that that was well done and really appreciate on behalf of the committee thank you very much Sharon I’ll turn it over to you is the chair of the board in terms of timing and lunch break and when we’re gonna come back it’s lunchtime I yeah again I appreciate the public comment I mean the first time we’ve done this and so we want to we want to be responsive and we’ll have our questionnaire that we do every time after today the Amy we’ll send out so please give us feedback on things lessons learned like maybe breaking up a meeting into two pieces, two different days which is what I’m thinking up from this one, and so we’re gonna break for lunch and we’re gonna come back at 2:30 hopefully that gives you, it’s 2:05 so and I apologize I know we planned on meeting around 2:45 or three but we’re probably gonna go until I’m guessing about four ish if that’s I know other people might have other calls I apologize for that well we’ll do our best to get through the rest of the day we have a valuation action item and a couple of other items as well so take a break and remember to come back on this line the open session line at 2:30 make everything right Jack anything else? All right. Thanks. Here Frank Superintendent of Public Instruction mr. Yamanaka yeah I represented the superintendent yes I’m here I lied in with for thee and it was a little blurred there forgive Mr. Prezant, here, Ms. Yamamoto, here Ms. Bradford here, Mr. Keiley yeah is he good here for the state treasurer Mr. Saha, that was a yes Finance Ms. Miller, here, chairperson I hand it to you, we have a quorum. And before we go I think I need to report out from closed session we did take one action item which was yeah we just have to say that all right We just took we took action on an item Jennifer do I have to say anything else? No. Okay all right so that takes us to item five and I believe that’s you Jack. It is this is your annual election of

board officers and also the approval the committee assignments and the committee assignments to take effect for our next meeting hopefully if you’re all satisfied with them we will use those so I this the one part of the meeting I run so I’m going to first open up two nominations for board chair for fiscal year 2021 do we nominations? Jack, it’s Joy my hands raised I got my we do this poll I don’t have a viability of that I’m sorry That’s okay yeah okay, Joy yeah. Thank you thank you, so thank you Jack and thank you thank you everyone I know it’s been a it’s been a long day and I’m you know where I think we’ve we’ve gotten a lot done just a couple of comments I wanted to make before I offer a nomination. I just really would like to recognize and thank Sharon and Harry for their leadership as our chair and vice chair this past year that the two of you lead us with integrity and empathy and humility you value and really respect different perspectives that we bring to the board or that stakeholders bring to us and most importantly if you really keep us focused on our core mission and who we’re here to serve which are which are our teachers as the chair and vice chair the way you partner together leads to lead our boards that’s such a great and positive tone and I know this will continue as you continue to work together with the board with the CalSTRS leadership and team as we navigate our path forward it’ll be it’ll be rocky and I’ll probably be wiggly I don’t know what will we’ll work together. So having said that it is my honor to nominate Harry Keiley, to be the chair of the CalSTRS board. All right thank you joy and do we have a second for that nomination from joy I second that from Karen think thank you and do we have any other nominations for chair of the board, seeing none that I will close the nominations all those in favor of that of the nomination please say hi, or raise your hand or bridge or any or any opposed, we actually raised my hand sorry by unanimous consent Mr. Keiley, you are the board chair of the coming year Congratulations And now we must proceed for nominations for the Vice Chair of the board for the fiscal year, do we have any nominations? Gayle was that not were you not me, I you saw a little yellow hand I here think, I don’t know what that was. I’m happy to make a nomination that’s appropriate Joy you still got your hand up still I see, no I was clapping for Harry and Sharon I think we’re all used to using emojis with them with cell phones but if if this way of life continues we might have to learn how to use them with with zoom too so um well thank you and congratulations Harry you know before I make a nomination I just want to also make some comments you know our our our past chair for the year Sharon is is a woman of incredible talent. In addition to serving as our board chair the past year she was also elected by asset owners from around the world to be a director on the PRI association board which i think is it is an amazing accomplishment and it’s amazing for CalSTRS because her leadership on that board has helped us and will continue to help us extend our voice globally on unimportant on issues and important issues related to responsible investment and while I know we are really focused on a lot of the challenges that we have ahead you know with with the fund and with the portfolio I think responsible investing and all that stands for is something that’s been a hallmark and core to our system and knowing that Sharon will be able to continue doing that and representing us and bringing those views back to us to inform what we do we looking to me to be really important so Thank You Sharon, and I’m pleased to nominate Sharon Hendricks to be the vice chair of the board. Wonderful thank you very much and do we have a second for that nomination? I will second. Thank You Betty. So any other nominations before the board for Vice Chair, seeing none the nominations are closed, all in favor please say aye. Aye Any opposed? No. Congratulations you’re in it for another twelve months. Could I just make one comment if I may? So just because I I think

today is a perfect example of why I miss you guys so much and why our board works so effectively, is we are colleagues and sometimes we disagree and we do that respectfully we have different ways of thinking of things we have different backgrounds in different ways they come to this board but since I’ve been on this board eight years one of the hallmarks to me is we can disagree agreeably and we can be collegial without being overly nice if you know what I mean by that right because you know those people that are it’s nice but not there’s not that sharpening of each other too and so I think you know my partnership with Dana and Harry through CTA has been so significant and now with Denise coming on board and I’m really proud that in the midst of other teacher labor wars other places that we don’t have that at CalSTRS and that we are partners building each other up and it’s an honor to serve as an active teacher the three of us on this board and to lead it as an honor and a privilege and I’ve been really grateful to how that honor this last year and to me it’s all about like today you know demonstrating how we can support each other through our skills I mean making the board better so I’m excited about Harry being chair I’m excited that the band is still together ki and I are gonna be sure and I sure continuing on the good work at CalSTRS so appreciate that. Fabulous, and then if everyone is comfortable with committees did anybody have any other changes from anyone now that we’ve got the template out? That worked for everyone, okay Can I make one one other comment? Oh sorry, yeah Matt had his hand up We sent out an amended version Matt hopefully you saw that with your with your elections on that We’re not picking up your voice’ for some reason even though you’re not muted are you really talking?Ooh yeah that’s perfect. So I had a chance to talk to the treasurer about the assignments earlier and she has had a small request I know that she was I think added to the compensation committee and she was just asking that to not be added and maintain her committees that she previously had in last fiscal year. So you’re saying she wants to stay on the committee she was on last year? Is that what you’re saying, Matt? Correct yeah she was hoping to stay on those, I think that she was added to compensation and she was just hoping to keep the one that she had previously. OK got it and yeah I double-checked the requirements of how many board members it looked like it was still okay so it is yeah yeah a good five members on the committee and and we just need 3. Ok thank you Matt. One quick comments about the investment committee too, just because because I’ve also appreciated the leadership of the investment committee and we’ve made some changes this year I’m really excited about the transition Harry’s been so phenomenal on the investment committee he thought it might be too much to do investment committee and the board so I’m glad that he’s been willing to be vice chair and have joy step into the role of chairing the investment committee this next year I think that just seems really exciting and in the spirit of us all learning new skills I just feel like I don’t know I just I love that I’m an educator I love people learning and getting new opportunities so I makes me happy looking at all of you and thinking I hope that you know we just have different opportunities to step into leadership roles at different points with their expertise and that’s a that’s a pretty great thing anything else Jack congratulations yeah all right so we’re gonna move to item 6 which is the CEO reports, Jack I’ll do this and then Julie will come right after me with the risk management report which they really fit together well I mean you’ve heard a lot of generalities already today about the transition to teleworking but we wanted to make sure you knew exactly what was going on also I think with a little different in this report that you have before you which are really proud of but the staff was able to do this is we’ve got measurement it isn’t just saying to you yeah it’s all working and we’re paying the bills and we’re doing this we’ve actually tried to measure week by week how each of the production areas is doing and compare that to pre kovat and during the Kovach crisis so we actually not only can we assure you and our executive staff they were getting the work done but where there are some gems here of success there’s some lessons here that tell us that we better not go back to the old way of doing things either because there are absolutely some signals in this data that would tell us

that we need to take some different courses on coming back so just a broad comments we cassandra has really been our point person and led our EEOC from the beginning the the Emergency Operations Center so there she is so she has led the team and works on this every day a little bit on what we’re doing and not just in terms of getting us out the door in home environment but now her heavy load is working on the task force to return at some point in time but as you can see by the dates of this weekend beamed that yo se quite early in the process and for many years we’ve had a plan in place and we’ve done tabletop exercises including a pandemic exercise oddly enough many years ago where we simulated a flu coming in from Hong Kong and we talked about what would that would mean for the organization but we certainly never expected it to be this level of a footprint on the organization requiring us to have all 1,200 employees go home you know and our first look back on this on this telecommuting is that there’s been a couple either of the good planning or a little luck there’s been a couple very critical technology issues that our way and that has made this work very well and it’s five things and I just want to make sure you kind of hear those so you kind of appreciate just how pivotal they are to everybody else doing their jobs first off is that we moved away from desktop computers now I’ve got some friends that work in financial services organizations and they have classic computers desktop screens a CPU beside their desk and when it came time for those companies to go home they couldn’t do it they had all this equipment that was really stuck in the office so she should his team had moved us to a laptop scenarios some time ago and they plugged into a desktop in our office so absolutely that made it easier for us to be able send employees home right away with a laptop computer and then we also allowed them to take their monitors home too because for some of our staff it’s just too constraining looking at a laptop all day long to do transactions on the screen and use our systems so number one having laptops number two we had gravitated the organization to using Microsoft 365 a lot of you probably use that on your home computers but offices are still making that transition but thankfully we all gravitated to that we’re ready to use that office suite thirdly we had our imaging system well running so that documents that are put into the imaging system in the mailroom and scanning facility are accessible to all of us at our homes so having that scanning software available to us we were using a Genesis platform for our call center in the office but again our technology staff and Bill and the benefit staff we’re able to expand that platform to home use so really I mean much to our pleasant surprise the call center and all those that need to work with our members had a platform available fluidly to be able to use at home and then fifthly and most importantly we started out on that those first couple of days with about 400 employees having access remote access into our core systems and again Aashish the technology branch all the staff worked hard to quickly expand so that everyone in the organization and availability to use the core system so those five technology drivers really enabled us to get to where we wanted to be today what we’re doing this report goes through it isn’t the whole organization I wanted it just for this report highlight primarily the member facing aspects of the organization so you feel you understand how the members are impacted as well as for Julie’s area are we getting the money in the door from the schools so that it gets invested appropriately so as you go through this report page by page I think I think it’s pretty clear for all the service areas they’re performing at a very good level of performance and that we’ve got a few that are performing even better than they have before and I and I do highlight the the call center particularly because it is tough work for us and and we’re always watching out to make sure we’re doing well with that but on TRB 18 if you can see their telework results they are exceeding their targets that we set for them their annual performance targets and their every speed to answer is 30 seconds and I couldn’t be more proud I mean if you’ve done any phone calling during this period of time with any of businesses you do business with it would be pretty pretty rare anybody would pick up the phone in three seconds and talk to you and so all those benefits the services staff are working tough hard to make sure that we get these numbers

where they are but these are incredible statistics on this page absolutely great so throughout the whole report I think you’ll see good stories in each of the areas of the organization and also the money coming in from the County County offices has been coming in on time and when Julie does her risk report a minute if she wants to add commentary to that but again I think you know the things we have control of we could actively manage we all worry about supply chain failures for us the supply chain is actually the money coming in from all the school districts and has not been but probably all 4c we all be a list of a short list of things we thought this is good definitely going to go wrong and actually it’s worked very well the whole ecosystem of collection and payment going throughout the system and of course the checks have all gone out appropriately to our retirees our only stress point has been on the international mailings that Julian can talk about in in the risk report in terms of challenges things we’re starting to see right now bubble up that are they’re a bit bit of an issue this is getting be long so although people took a laptop home with them not everyone has a home office so all the things that we enjoy and working in an office setting the ergonomics the desk someone cleaning every night with and I said all the things that you do in an office setting don’t go on in your home so I mean as we think about this long term and if we’re thinking this could be not just months but could be a year maybe for some employees we need to think about that Home Office and making sure it’s supportive of the health of the staff well their home we realize just how dependent we are on the mailroom of the scan facility we’re averaging about 50 employees in the office every day but a core part of that is that mailroom scan staff because they’re bringing the documents into the system for the rest of us for you so that’s a very strong dependency we still have some paper we’ve reduced a lot of paper but we still have paper that has to go out to the members especially for our retirement readiness staff doing estimates and counseling so on Wednesdays the benefits and services staff comes into the office a small contingent but they’re preparing the packets and they’re mailing those out to the staff so we’re still dependent upon that we still need some hardware or some better headsets for our staff our home not only for having inbound calls but so they can make outbound goals and then finally I’m sure you’ve all used DocuSign in your personal life for a mortgage or some other piece but it’s it’s turning out to be such a valuable technical we do a lot of document work with the controller’s office and other organ parts of the organization and having jockey sign is is truly a godsend and we can expand its use within CalSTRS as well so those are some of the challenges we want to work on so now we’re turning the corner and thinking about things I just want to share a few minutes just kind of set kind of our perspective on this and I know we’re starting to see some signs of retail opening up and you know I think if people get that the taste for fresh air or the taste for the taste for retail transactions that’s going to create a lot of that external energy but I will tell you our executive staff and the team that casandra’s put together for the return to the office we have a very conservative view of this and we absolutely are not going to rush into this and not rush yet people back in the office it’s very clear to us we’re not going to turn the green light on and ask everybody to come to work in June or July it could be a period of many many months of gradually bringing back employees and it could be because it could go into 2021 I hate to say but there are just so many issues as someone said earlier today go coming going back to the office is a lot harder than leaving the office on the areas of social distancing tracing testing what happens when someone does get contaminated all the things that are gonna there will happen we’ve got to think through and do it in a again a slow methodical safe process and that’s the message we’re trying to send out to our staff so it’s possible we may see some signs of life in the building in June but I think it’s going to be later than that before much gets going and issues around travel and visitors are also compelling issues that that we’re going to have to think about to get right so bear with us it will keep you updated of course

but we’re doing a survey this week of the staff and trying to one make sure we kind of appreciate what the experience has been like for them telecommuting because I think there’s an opportunity here for much of the some of the staff I don’t want them as much or some to remain in a telecommuting status so we want to appreciate that better and then we want to understand what we need to do to get people back in the office of Cassandra and her task force will digest all that data next week and when it comes in and start to really develop a concerted plan around that because I sure won’t let you jump into if you’d like you’ve been doing so much of the work eating everything would you with the parts that you want to reemphasize her no I think he went over really well we’re just externally happy that we were able to transition so quickly and so seamlessly it was a lot of hard work and coordinated effort and just underscore that we initiated the EOC a March 2nd which was far faster and sooner I think than anybody else hadn’t really been thinking that the pandemic was going to go in such a trajectory that we have ended up in and so we started planning early on and she she was working early on it and ramping up the bandwidth of our technology systems and again underscoring that we had been preparing for our ability to be mobile you know years ago when we started assigning laptops to everybody because we wanted to be able to have the flexibility to work in different environments so it’s all gone well I agree again I want to underscore that we are going to take a cautious and very thoughtful approach and bringing people back in because there’s so many considerations in doing that and it is and could be very high-risk and we want to make sure that we’re just able to do our core missions mission of collecting contributions investing contributions to paint our members as the primary focus with coupled with keeping our staff healthy and safe so I think we’re doing a great job at executing that with all the help that we have in the organization say thanks thanks Cassandra yeah I mean I think it most you know the in the first weeks when we’ve gone home everyone who clearly was challenged they wanted to get it right there was an awful lot of energy to get it done and now that we’re setting into a longer term vision of this you know I think it’s our our job to figure out how do we keep that more out how do we keep people communicating and the social connections that that you need in a workplace the some of our boys don’t like telecommuting they actually want to get back and see it a fellow human being not on a video screen so there’s a lot of psychological aspects to this if we’re going to be doing this for the long term so that’s another aspect of this around communication tools that we’ve introduced some social tools indoor into our toolkit with the staff and try and do some fun things with the staff to again to keep people motivated interested connected to the organization what we do I was gonna talk a little bit about the headquarters expansion unless anyone had a question just about the transition itself I don’t see anyone Jack okay just you know again a good surprise I mean the building construction is going up quite quite readily by the time well if September’s our next physical meeting and then building you’re gonna see a number of levels of the parking garage completed by September we’ve had minor issues to deal with in terms of change orders noting that in any way threatens the budget so there’s nothing to highlight there per se we certainly have had to introduce a number of procedures around screening the construction workers before they get on the site so this is certainly new new for construction workers to fill out questionnaires and have their temperature taken before they get on the construction site but we have to be that careful with them as well in what they’re doing I when we first went into this kovat mode I was really concerned that we would have a lot of supply chain problems with materials because the project is moving quickly although for the most part where we’re focused on concrete right now, so it’s one particular supply chain link that we need but again our team has not identified yet any weaknesses in that supply chain even though we have materials coming in from a lot of different places and again in the case of a couple of materials even overseas but so far there has not been any time delays in that supply chain so the construction is still on target and we have not had many rain dates so we’ve not used many rain days in the schedule either so all good there I mean to our hopefully you saw on the write-up amazingly this project was named environmental bond of the year like like for the world I mean it’s a the

organization that does this so that was just real real nice to see because as you remember there was really the board that came up with the idea of even doing this with with a bond and it morphed into a green bond and it’s just nice to see that that ended up as a side benefit to the project so I’m great to see then Julie staff has done so much work to make sure that it was a the green bond piece of what was done right so I think that’s all I had to focus on if you didn’t have any more questions I’ll let Julie it’s gonna morph into this and do the risk I did just want to mention before you have you had it off to Julian that I really if you’re aware but Jack was doing these like Jimmy Fallon imitation like videos if you’ve watched some of the late-night guys doing the stuff at home Samantha beaches and women as well but Jack you did it I just I think that personal touch and kind of using some humor the midst of a really challenging situation just demonstrates your strength as a leader I also do want to give a shout out twitch sheesh and my campus our de coordinators which is like your distance ed coordinator those people in particular are just completely overloaded right now and I feel like if she shows like our de core degrees like the IT guy and so I know it takes a village and there’s a team behind him but I just do what I think him for helping to kind of facilitate that process along with Lisa and lots of other people in my estate and so I know all the executives and our teams have done so much work so thank you for that mm-hmm so Julie you want to talk us through the risk reports because risk is something that we’ve definitely been thinking about the last eight weeks for sure that’s for sure yes thank you madam chair members of the board I’m Julie Underwood chief financial officer and as you’ve been hearing all day regarding the kovat 19 pandemic calstrs faced an unprecedented time where our risk quickly escalated into issues that needed immediate management while we still worked to mitigate manage other ongoing risks that were evolving and changing at a very rapid pace now this is the normal time where we would have presented to you our normal semi-annual risk report with our updated heat map due to the timing in the fluid and unpredictable nature of the pandemic and just how quickly we had to deal with both risks and with issues that resulted from it we felt it would be prudent to provide you a risk report that focuses on our mitigations associated with the pandemic from a risk and an issue perspective for each of our 10 risk categories male since the report before you is comprehensive and considering that the investment committee this morning and Jack CEO report included many discussions with you on many of the risks and issues that we faced I’ll just touch on a few of our top risk areas and issues as we’re continuing to mitigate the effects of cope at 19 first I wanted to talk just a little bit about technology and tell you that I’m pleased to report to you that there have been no elevation of phishing attempts or fraud campaigns when compared to prior to the pandemic that we’re aware of but we do continue to monitor our systems very closely from an essential services perspective on the investments I just want to reiterate what Geraldine had told the investment committee this morning we do have sufficient liquidity to pay member benefits well into the future our benefits are secure and continue to be paid timely now we do rely on the state controllers office to assist us with our payment process and they have assured us that our that payments are also their priority and we do thank them for their continued partnership now we are currently monitoring the delays and international delivery of mail in some areas we are monitoring the suspended service areas for both USPS and FedEx and so far we’ve been able to utilize DHL for some of these mailings when we need it contributions continue to be paid and member files continue to be submitted by our employers despite school closures as was mentioned earlier and we continue to monitor the impacts on school budgets relative to the state’s projections for lower than anticipated revenue just wanted to quickly mention a few things on our funding plan our actuaries are monitoring the markets and their potential impact to future contribution rates but it is too early to determine how the pandemic will affect our funding levels now we do expect the state to reassess their 2021 supplemental payment to us as a result of lower than expected revenues but note that this payment was not included in the most recent actuarial evaluation now we are beginning to hear of some advocacy calling for suspending contribution increases in pension reform as you may

be aware of contributions are delayed now they could be even higher in later years so we are monitoring very closely for all pension reform efforts now in Jax CEO report there’s some information about the budget because the state is projecting such large decreases in their state revenues we believe that’s going to have long-term implications to both the state and to our employers and because we are supportive of the state’s objectives to maintain a balanced budget we are recommending to reduce the board approved 2021 operating budget by 88.7 million now that includes 3.9 million for 27 permanently authorized positions and 4.8 million for contract expenditures now we will still be moving forward with our request for the 53 million to fund the completion of the pension solution project as delaying that project would cost or in the long run now with their proposed reductions we are currently reprioritizing a evaluating the long-term impacts to the organization’s strategic initiatives with the goal to keep those initiatives on track and maintain our service levels will be an extremely prudent an expenditure of our resources given the current state of affairs now we will provide you with a revised operating budget at the July board meeting regarding staffing just wanted to mention here that we are monitoring absences due to COVID 19 and the added benefit provisions and the emergency family medical leave and paid sick leave acts as of earlier this week we have 67 active requests and currently we are able to absorb most of that workload since approximately 70% of those absences are intermittent only and we are as mentioned earlier working on return to work scenarios and also we need to think about potential resurgence scenarios as well with the goal to preserve the health and safety of our employees regarding the three large projects for the collaborative model you heard a bit of that this morning at the investment committee so I’ll just add that work does continue on the pillars project there were some minor delays in that project but staff has prioritized and are working on the highest priority goals and we continue to monitor the resources to support that project and staff will provide the investment committee a more updated update in July on the progress of the pillars project a Jack already updated you on the headquarters expansion so the only thing I’ll add on that is that we do continue to monitor all the risks in the project we receive regular updates at B headquarters extension executive steering committee meetings for the pension solution project so for that project continues with minimal loss and productivity related to the pandemic but we could experience setbacks if the shelter and place orders are prolonged since this is a project that requires continuous communication and collaboration now the user acceptance testing and training are upcoming activities and we are currently developing mitigation strategies to convert these efforts from in person to virtual experiences to minimize the impact in addition you may recall for the last board meeting that our contractor CGI started experiencing delays and their contractor acceptance testing now these delays are continuing and are estimated to cause an overall one to two month delay now we do have a three month contingency in the schedule but these delays may likely impact the compression of the remaining activities that both staff and CGI need to perform now we do have some ability to overlap testing activities to mitigate the extent of some of the delay so we’re actively monitoring CGI’s test results on a weekly basis and communicating with them on the impact of these delays so overall just say that we do continue to monitor all the risks and this in the further pension solution project and we receive regular updates on the project’s risks at the pension solution executive steering committee meetings now overall for the strategic plan right now we are experiencing some short-term step backs and some initiatives so for example promoting a pension to participation is a lot more challenging giving the current market volatility as well as school closures however I’d say overall we do remain on target to accomplish the board’s strategic plan but we will continue to monitor our progress and will notify the board should significant risks arise lastly just wanted to mention a little bit about third-party risk again we’re not experiencing significant issues with supply chain or non performance issues other than some delays in small items like obtaining masks and sanitizer as many of us are also experiencing so I just say overall I’m considering what we’ve recently been through our business operations and our risk profile do

remain stable under our new normal as we work differently with an added emphasis on COVID19 risks and issues so our focus now will be on managing continuing issues while still monitoring the risk areas reflected on TRB 39 including those return to work scenarios and accomplishment of the board’s strategic plan as well as keeping a watchful eye on our customer service levels and our performance indicators lastly I just wanted to mention that we did kick off our annual risk awareness online training for all staff on May 1st and that training will reiterate the importance of risk management so that’s my prepared remarks I’ll open it up if you have any questions really thank you and thank you again I know Harry and I got to meet with you and through this I just appreciate your your precision your focus the structure in which you present things it as a fiduciary we want to make sure we we understand all the things that were supposed to oversight in terms of risk and you’ve really given us a helpful document so I appreciate that I’ve got a couple people in line joy and then bill joy great thank you thanks Sharon and I don’t know this question is is to Jack to you or to Julie but it kind of goes to the headquarters expansion project you know we’ve spent a lot of time throughout the day talking about the uncertainty that we have including return to work both for CalSTRS and how you’re managing that for our workforce but also just for the you know for the general public for people we work with I guess I wondered with the expansion project have we given thought to how what we designed and up you know and approved and are moving forward with pre kovin whether that needs to be adjusted to become it given the new world I know that’s hard to maybe the hard to assess given the uncertainty but things like you know space per employee that you know the type of open space environments those are all the kinds of things that businesses seem to be thinking about and I I wonder how we’re factoring that in a lot about that issue because it is hard to know you know to make purchasing conclusions on how we feel today this month in the middle of this versus how is this going to feel in a business setting 36 months from now and that that is tricky because you’re trying to make a fairly expensive furniture purchase for a building so we are trying to navigate that but two things on the current office tower there are parts of our current office tower that do not fit a six-foot social distancing standard so either a will have to do some physical changes to that setting which costs money or what I said to you originally is that we’re bringing people in slowly or on a rotational basis we may not have to change things physically in the current office tower if we can achieve that distancing just by calibrating the return volume into the building welcome to the new facility we’re just in the early conversation with the furniture vendor and you’ll be interested that the titles to their documents that they share with us actually say on the precoded COBIT furniture design so they are these furniture designers are doing their thinking on different ways of twisting the office as someone sneezes where is that exactly the land if I had twisted the office over here with a land differently so they’re getting the bad level of detail looking at changing surfaces that our hands are on just like you touch door door handles now that are you know antiseptic clean and can we have work services that way so I think we’re okay in terms of the timing of this of getting some benefit of research we don’t have to make a buying decision for several months so we’ve tasked the furniture vendor with that research but we will be making change at the end that’s the short answer is what we probably initially thought the design would look like is going to have to be changed and be more physical separation in the space and what we do so we’re going to have to absolutely be be flexible around that what we do the other thing is just in terms of the volumes of people we projected to be in the building um this can go both ways on the one hand if we end up leaving a contingent at home on a permanent semi-permanent basis then we have less need for people in the building and more space on the other hand if we’re changing the space in the building to give people a little more space then that may take up that extra space but bottom line is we you have a buffer here it turns out we would move more people into the expansion headquarters that frankly will lease out another floor and bring more

revenue any counselors you know so we’ve got some flexibility that way but right now it’s not looking like that’s going to happen because of the changes in the people’s social distancing expectations I think it’s going to turn out we end up filling up the space just with the different configuration you know in our offices were always a little bit smaller than stake over in offices when we built the headquarters tower we didn’t look to other state agencies really for our thinking we went to San Francisco and really benchmark the financial services organizations which which tend to be a little tighter with their Road with their real estate and they tend to watch the bottom line a little type tougher on office space so ours are not that big to begin with I would say so yeah it’s gonna weigh on us a lot how to how to figure that out I’ve got a couple more folks in the queue bill and then Harry thank you I don’t know who I should answer this question maybe maybe it’s Brian if for example one of the employers the school district were to take the position that they’re gonna take maybe not even taking the position but be unable to make the contribution in a timely way or claim to be unable to make that contribution is there a remedy available to force an employer to make a contribution I I know that’s sort of a rash statement but you know you look at the funding plan and our funding plan is so inherently driven by the elements which are you know investment returns and and employer and employee contributions as well as the state and here we are we’re facing a variety of elements which put all of those in risk at risk and so my question is is there a remedy and and I and if not in what are we engaging I know there’s a one remark and this report was that discussions and consultations are being held with stakeholders including the administration the legislature and I’m sure employers regarding the funding plan what’s going on there oh just the first part of your question I I think the second part is probably more from Jack and Julie so the employer contributions are mandated by statute so if the employers did not contribute they would be in violation of the law who would enforce the law who the interested parties so I mean there are legal remedies when there’s a violation of a statute hopefully we don’t get to that point but if we did then we would explore what those opportunities are whether it’s a motion for declarative relief or there’s some other there’s some other sort of drastic function but I really do think that the organization is more geared towards the second part of your question which is the part I think that I’m not the person qualified to answer that part of the question well they just had under and Julie you you manage this force I mean we have had experience where a school has not paid us so we have test-driven part of the law not in court but we have test-driven this wina when charter school based bankruptcy so we do have that issue of financial risk now around those types of situations so resolving that and frankly involves the state controllers office since they control the appropriations going to the school and it’s a it’s a frankly it’s a delicate political issue I wouldn’t I’m not gonna make it sound like sure it said it’s simple to solve and it wasn’t simple the time we had it but there were mechanisms to make sure that CalSTRS was fully paid when we did have a bankruptcy situation but you know clearly Brian’s Brian indicated there’s the courts have another alternative Julie did you want to add anything to that a piece of that I think you said jacket we have legal remedies because it is required by law to pay the contributions and so we would work with our legal department should we not receive contributions but we try really hard to work with our employers especially if they’re having issues with reporting and pain and we do our best to work with them when we can and that I have a whole staff dedicated to do that and so we do our best to try not to get to that point in terms of the political question you asked about schools and I guess that how they’re approaching this dilemma I mean unfortunately you know in our jobs we’re fiduciaries and we have a pretty narrow view we’ve got to support the funding plan and making sure that

what gets paid what’s what gets up and gets paid and that we don’t make political decisions over the funding of the plan so you know we don’t have any opportunity for forgiveness or delay for a school’s financial plight to the extent that is facing some schools I’m sure it is you know their ability to resolve that lies with the administration and looking at ways that the administration funds them or can help in other ways and those conversations absolutely are going on with the administration and I think the school’s recognize that that’s the dialogue they have to have for us here today and with just a few minutes we’ll be doing the actuarial evaluation I mean you’re there there is no wiggle room for us you know we have to keep the train moving toward full funding and we know the law and to the extent the valuations suggest changes that you have to make we move we have to move forward with those hey I’m Jack I’m gonna move us forward Harry has his hand up and then I think we’re gonna move from Harry’s comment to the next item so thanks Julie for your report and thanks for your responsiveness to the letter that Sharon and I in consultation with Brian hoards attorney drafted for management around risk oversight in our role we had a chance to speak earlier in the week and I think it’s important for other people to hear this it’s possible that rather than happen at least for the upcoming fiscal year rather than doing this semi-annually it might merit a quarterly report to the board short term risks the medium term risks and the long terms here we’ve got some interruption on your audio feed again yeah my back your back but we’re didn’t get the middle part we just got the beginning in the end anyway so perhaps rather than doing it semi-annually, this risk report to the board in our oversight role we may consider doing this quarterly, we can talk with Jack and Cassandra and Sharon but a year ahead and then breaking these risks down into immediate risks short term risks medium term risks long term risks and existential risks to the fund and what is the appropriate monitoring mechanisms, what is being done to mitigate these risks, and then ultimately how to report these risks to the board so in talking with you and Jack and Cassandra and Sharon and I think we’ve been brought into the conversation as well at some point we might want to change the pacing of the risk reports and fine-tune them a little bit because we may also have to be talking about the types of resources that may be necessary and required and they may be they may need to shift depending upon what takes place in the landscape I mean just today we we received the report out of out of the administration in terms of the challenges facing the state of California we’ve got some concrete numbers now so I think in the short term the risks be going away I venture to think they may escalate so it may require a different pacing of reporting and talking with the board about these issues around risk thank you thanks sorry so I know some people have to leave and we have action item so I’m really trying to move that’s part of you and I apologize right now to David Lamoureux and his team and David Nick mark but we have the actual evaluation item eight is an action item, item nine, item 11 12 and 12b, so we need to get, would be great to have at least a quorum before the end of the day, so and again those of you need to leave believe it when you need to but I would love to get these action items done if we can, so with that hi David and it’s I just want to do a time check its 3:26 and I know some people have to leave it like 3:45 and 4 o’clock so with that David, hi We are here to talk about the 2019 valuation however the last couple of months have changed things so much this is what we, yeah it’s a little bit looking for folks they will

do looks been a very short time going over there and then we also want to kind of update you on where we are based on what we’ve seen in the last couple of months and then we want to leave time for questions and comments so we’re going to shorten our presentation by quite a bit before I turn it over to David and Mark and Nick you know this has happened a few times before words hit shop market the plans so this is nothing new for the fund I remember back in 2001 after the.com but Lord John and I were here and we we advised the board to keep a steady hand and make some changes that are necessary but not to panic because this is a long-term fund and we have long term objectives and we’re we’re still in good shape no matter what is happening last couple of months so I think we should keep that in mind when these things happen I always like to take a look at and I’m looking at it now if you look at TRB 57 in our actuarial report, what it shows is the long-term historical funded status and it starts in 1975 and in 1975 we were somewhere into twenty percent twenty nine percent funded status and if you go back before that we were even worse off so we’ve had very hard times before the fun can withstand it if we are steady and take the long term approaching and don’t panic so I think you need to keep that in mind and the last thing I wanted to point out was that in 2001 when we said the advice you gave in 2001 is still good in 2020 and another 20 years when another market decline occurs I think the same advice would be good for whatever board is in place then so those comments I’m gonna turn it over a market maker here talked about the evaluation and David will lead the discussion on where we are currently based on a couple of months so I’m gonna turn it over to David now to lead the discussion. Thank you Rick yeah nice to see everyone not in person but on the screen better than nothing so we’re here to present the 19 valuation, it feels a little outdated but just a few things I want to highlight, is so the valuation you have in front of you does reflect the supplemental payments we received from the state last summer we receive about 3.3 billion dollars in supplemental contributions which is was one of the main reason that led to the improvement in funding levels the funded status went from 64 to 66 percent between eighteen and nineteen it also the valuation is based on the newest assumptions that the Board adopted last January so all of this was built into the valuation on this I just wanted to highlight that every couple of years we hire an independent firm to review and replicate the work performed on mark and I’m Elliman at last year we hired a firm called Chiron to review their work and I just want to highlight that between January and today Karen finished their review of the experience study and the assumption that the Board adopted last January the report is now final finalized it’s available on our website for the public to view and Karen was able to replicate all the results and assumptions and mark and Nick recommend it to the board and they said they were reasonable and they were an agreement with the proposed assumptions we just want to highlight this so what you have in front of you going back to the evaluation this is an action item so if you recall the funding plan gave authority to the board to adjust contribution rates with certain limitations so for this state the board has already been able to exercise that authority for a few years, so this is one of the action item in front of you is we are recommending an increase in the state contribution rate of half a percent, so you can see what we are what will be the impact of the recommendation if you go to TRB 44 you can see a table that compares you the contribution rate that the state is paying this year and what we are recommending and what the board has control over is the second line of that table what we call the supplemental contribution rate for the state it is currently five point eight one one percent and the funding plan limits annual increases by the board to half four percent of payroll so we are recommending it recommended that it be increased is six point three one one percent as shown in that table and with that recommendation the state would be

contributing to CalPERS the CalSTRS a total of ten point eight to eight percent for the year eight point three to eight to the defined benefit program and two-and-a-half percent to the what’s called the SDM a the inflation protection program that you administer so that would be what you’re looking at and the main thing I want to highlight here is if you ignore what’s happening this year we still have to remain on schedule but the funding plan we are still looking at two more years of increases in the state contribution rate so even with the increase today we are still not where we would need to be for this state to eliminate their share of the unfunded liability that was in place last year as of 90 so just keep that in mind we still have two more years of increases and as Julie mentioned in her item I know everyone is anxious right now about what’s going on what is that gonna do to funding levels and contribution rates it’s still early to to tell exactly but if you remember our discussions we’ve had the last few years especially in our Risk report in November how we’ve highlighted that most of the investments risk is borne by the state what is likely gonna come out especially if we stay where we are Chris Ailman mentioned this morning that looks like we’re about flat right now so if we do end the year with a zero percent return it could easily add another decade of necessary increases to the state contribution rate to be able to achieve full funding by the end of the funding plan by 2046, so just keep that in mind and again we stand ready to come to the board early in the fall once we know exactly where we finished a year so that we can update everyone on what it exactly means but to end my comments as we stayed in the item the main thing I want all of you to be aware we are in a much better place today to withstand what’s happening because of the funding plan because of the fact it provides us board member the authority to adjust contribution rates even if it’s limited to react to these drugs in the markets and even if our funding if levels were to decline as a result of this because of the funding plan we would expect to make progress toward full funding and the last thing I want to remind the board is on TR B 45 we list the employer contribution rate for the upcoming year those rates are set in statute so it is currently the employers are currently required to contribute 18.4% this upcoming fiscal year that’s set in statute and what I want to remind board members this is the last year that that rate is set in statute when we come in front of you a year from now not only are we going to be asking you to adopt the state contribution rate like we are doing this year but we would also we’re also going to be asking you to adopt the employer contribution rate which will be the first time in the history of CalSTRS and the board adopts the employer contribution rate so that’s a year from now and with this ends my comments I’ll let if Mark and Nick want to say anything I’ll let them jump in and just everyone knows if you see marks video appearing and disappearing mark emailed me to let me know that his internet is going in and out soon so it looks like at the moment we only have Nick on the consignee if you want to make any comments ok well I’ll take over from mark because he was getting out the comments I mean I think the story on the valuation it really is a new news is good news but obviously that news is out date so basically there’s nothing really too much to remark on on the valuation I just kind of reiterate what David said about you know the funding plan is doing what it should do but it’s gonna probably be taking some significant stresses so we’ll just have to monitor that closely and really the best time to address that it is in the fall when we’ve kind of dust is kind of settled and we know what the June 30th 2020 numbers are so with that I’ll turn it back over to the board thanks Nick and if and if markets back on it has something he wants to add we’ll make sure we hear from him I’m so bored I can’t um thank you madam chairman and thank you Rick and David and Mark I think it’s you know it your jobs are always hard and especially during these unprecedented times I am gonna abstain from this vote madam chair I understand how hard everyone has worked but I I want to just give you a little bit of context the you know we the state I hope you’ve all arrived by now as anticipating significant economic impacts from the pandemic and the

because we know that a recession is here as we talked about in our investment time and the significant decreases in state revenues and the increase in caseloads for all our safety net programs to take care of people who are really suffering right now in addition to our frontline workers you know we are evaluating multiple proposals to address the the contribution increases for the state and employers school employers and so I did I wanted to make sure to have full transparency around what what is going on at the Department of Finance and the incredibly difficult choices were making when there’s you know the number that was recorded is 55 billion and as a deficit so I am abstaining I completely understand where the board and why we have to do this today but I do think the context is important in terms of kind of with madam chair just participating in in no surprises so I we look forward to continuing to work together and and you know coming out of this as we always have before and to mr eNOS this point that we have all we are continuing to work together on this and there’s a lot that goes on so we really do appreciate the work of CalSTRS and how and how devoted everyone is to releasing us through this so thank you for that monitoring they won’t take up any more of your time well if you could just note my abstention please absolutely we’ll make sure that that we do that thank you any other questions from the board the recommendation is on TRB 46 and what our actuaries are asking is adopting that normal cost rate of 18 point 1 3 3 percent of payroll and for the 2% of 62 members and increase at the state rate from five point eight one 1% to that six point three one 1% here all make questions or at entertain a motion, this is an action item So moved, oh that’s right we do roll call sorry so roll call Thank You Bill, it’s been moved and seconded Jennifer is it, Jennifer yep can you do a roll call vote for us for those items. Sure yeah. Thank you. Ms. Paquin. Mr. Yamanaka yes mister Yamanaka aye mr. Prasad hi Ms. Yamamoto, aye. Ms. Bradford aye Mr. Keiley, aye. Ms. Higa, aye. Mr. Saha, aye I’m sorry is that a yes or a No I still couldn’t hear miss Miller I’m abstaining Jennifer Thank You chairperson Hendrix would you care to vote yes although yes the motion passes. Great .Thank You Jennifer and thank you, David, Rick thanks to Nick and Mark. I think you know Gayle’s points are good we’re facing unprecedented stress on our state budgets and we recognize that I think I just want to reiterate that you know we as a board our soul you know commitment is is the you know financial health of our system and this tension and this the funding plan that we put in place and so we recognize there are some challenging conversations ahead but I appreciate that the partnership and we’ll work through this California where a strong state and we’ll get through it but I appreciate the perspectives shared by the board and thank you for approving this so you have your approval thank you David Rick Nick thank you yes if you thanks so much item number nine is the emergency delegation procedures Brian can you take us through that real quick did we lose Brian no just wrong wrong button oh I’m operationally challenged so this may seem a little bit like closing the barn door after the horse got out but we did have some discussions about having to put into place contracts and right now the the way the system works is the board has delegated to the CEO certain authority to approve contracts than on investment contracts up to a million dollars and up to a hundred thousand dollars for sole source contracts the board has retained the approval authority for contracts above

those limits in the case of a declarative see if we need to to enter into a contract above those levels we would have to bring back the board to get a majority vote given the difficulty of sort of infuse Chris’s metaphor of turning that ship into the wind we thought it was prudent to to create an exception in the board policy manual should we need it for the chair and the vice chair to approve contracts above that limit up to ten million and a million based upon the recommendation of the CEO and then as a control well there are two controls when it’s only in the case of a declared officially declared emergency and to those contracts of course would be transparent they would follow all of the state procurement rules that are applicable and then would be reported back to the board so again this is a this is an emergency measure we may not even need to use it at this point but it does seem we face two major emergencies in the last two years and it seems like it would be a prudent provision to in the governance manual so that’s that’s why it’s before you so Gayle is that your hand up again? Okay go ahead. So I’m make sure yeah I’m just gonna, thank you madam chair and thank you Mr. Bartow, I am a little bit curious I hear what you’re saying I mean there’s I just always want to be mindful about what we are and are not approving during emergency circumstances so what I’m a little bit so there’s nothing currently Mr. Bartow, that you think we would have to know contract we currently have to enter into that that would use this approval. No and if there were we would be presenting that as an item in your contract approval process which is coming up in couple of items to to give you an example I think when Ashish Jain took over as the as the Chief Technology Officer, one of the things he discovered you know bringing his expertise is that a lot of our servers were out of date and we were going to potentially lose some of our services if we didn’t update them immediately and he estimated that amount that five million dollars which was which was within our technology budget and so it was it was something that we had to approve immediately which was in our budget and it was not something that had to go before the board but it was it’s that type of emergency had and we needed to pay to place servers or additional purchases above a million dollars to for technology to move out of the building it would have been very difficult for us to do that without violating the policy which of course I would not let anybody do, so I thought this was a this was a good stopgap measure and hopefully we put enough controls in it to recognize it will be used very rarely.Thank you for that I guess I’m a little bit unclear on so if how long what would the waiting period be just in terms of the criteria, I understand kind of the the emergent criteria you set forth, but I’m not clear on kind of because so you’re just saying if it happened to follow within the six weeks that the board isn’t meaning and you needed to make a decision within that period of time yes that’s correct it would be it would be between board meetings and it could not be we couldn’t notice a special meeting 10 day notice but it was a it was a decision made by the CEO to recommend this and then it was a decision agreed or followed and made by the board chair and the vice chair but only on the recommendation of CEO okay thank you that’s helpful I would just be you know I think we can sometimes folks as contracts in times of crisis can be complicated so I assume this would just be a very very rare one-off event so I would just note that like you know for example if if the return to work order or to come and enter into an emergency PPE contract or something like that so I’m comfortable with the parameters but I think we’d also want to be really mindful of of what these contracts potentially look like so thank you madam chair thank you now an excuse my breaking dog it has begun Harry and Karen so Brian is is it possible and maybe this is are already contemplated to have remove review and approval by the General Counsel’s office as well oh yeah some that’s implicit in it but but

I think it you know the more we make it apparent that this is not just you know gonna be three people you know looking at it and saying yeah let’s go and I know that that is not the case but I do think that if we can make a record that this is going to be reviewed and approved by General Counsel’s office it gives us a little bit more comfort I appreciate your asking the question and that was actually in my in my notes it will follow our normal procurement process it’ll just be a little bit more rapid and that involves review fiscal review as well budgetary review it will involve legal review it will adhere to state tracking processes the public contract code law it will have our our standard terms and conditions so it is really just an emergent seapower if if it’s necessary for the for the organization to function but it will have the same internal controls the only thing that would be missing would be a full board presentation which which we put into the policy would happen immediately after the fact that the next regularly scheduled meeting or the next meeting so thank you for asking the question so thanks for uh same concerns that Gail and bill raised so my understanding is it would only be for contracts that needed approval between board meetings that the CEO was recommending and the chair and the vice chair as well as well as your office would review and then the transparency the reporting out will be at the next board meeting at what point does the dollar amount which is now up to ten million go back to the 1 million dollar threshold well the concept is the the the threshold the ten million dollar threshold is only in the case of a declare officially declared emergency otherwise the normal this so this is an addition to the policy manual so the normal policy remains in effect that an ordinary course of business the board approves any contract over a million dollars in any sole-source contract over a hundred thousand dollars and as I sit here today I don’t see any contracts right now that we would need to to invoke this emergency provision but if we needed to create an emergency provision we’d have to pull together the full board to vote on an emergency provision which would then sort of defeat the purpose so again I or your normal policy will remain in effect as a matter of fact you’re going to be looking at some contracts later in your agenda, so this is only in case of emergency break glass. So okay so the emergency is one that’s declared by the state? Well it’s it’s an officially declared emergency and the reason I it’s it’s broader than that is right now we have a national declaration of emergency we have a state declaration of emergency we have a Yolo County declaration of emergency and I really don’t know but I’m gathering is maybe a West Sacramento declaration of emergency you know and I’m sorry we’re in this situation but it really is kind of difficult to nail down which one’s going to be affect us at the time that’s pretty broad use of the term of state yeah which is why I try I put in the phrase officially declared state of emergency has to be by unofficial which would be the governor the president the mayor City Council the County Board of Supervisors whoever has that authority I’m happy if there are any drafting considerations I’m happy to make those thanks Brian more people on the queue and I think we’re gonna turn we’re going to the next agenda so Karen hi so thanks for all the clarifications I just have just one more so can you just clarify that it’s for anything any vendor any item anything as long as it’s me between those dollar figures okay yeah and an on investment contract so it would be for equipment for services so anything that would normally fall within the the CEOs and the board’s a power that’s been something that’s been delegate to see a hundred million dollars okay so so anything yeah okay outside of them deserts okay thank you Matt thank you sharing of just two quick questions I know this is all comes a try

to x-bike process this is amazing which i think is such a good decision but I assumed just because the nature of that there’s not really an opportunity for other board members such as statewide elected officials to weigh in or provide any opinion on such a contract approving that sort of thing you’d have some bagley-keene difficulties in trying to entice okay I assume that that that could be a conflict that I wanted just for clarification say that that would sort of be an untenable thing to try to thread that needle if for instance a board member you know had an opinion on a particular no contract even I don’t want to address but lastly I just really quickly I guess deserve and it is a not a feasible thing either but well if a contract you know is approved under these circumstances is a possible but it could be reported to the board prior to the board meeting as sort of a heads-up this action was taken or is there an issue with that as well no that’s an excellent suggestion I’m sorry I’m I’m glad you raised it we will add that get that into a process to immediately notify the board and so that’s a great suggestion Thanks yes well yeah I don’t think it’s any issue with obviously notifying it but at the next public board meeting I just felt like for those that might get questions about such a thing it might be good to just be aware the delegate authority we have about making it making a judgment on legislation we just did that in a particular piece of legislation that Harry and I kind of were delegated the authority to make a decision and then we send a note out to the board notifying you guys of what we did so I think I think that’s a really good idea Matt and we can we can do that before the next board meeting yeah it’s one one quick comment Brian when you when you draft this resolution I would like you to add all the language that you’ve referred to in terms of you know the process that you normally go through just so that it’s you know clear that this is a rather robust review prior to the approval by a variety of different people at CalSTRS and and and and consistent with California contracting law as well yeah so Brian I think that’s this the lessons learned we’re just trying to find things that have happened that we said we could have done this better and there could have been some technology expenditures we would have had to make within hours so we’re trying to just clean up stuff that we know could go wrong in the future that’s all great so I will add that language as well as, as what Matt just pointed out to that board members will be immediately notified. Great thanks Brian so this is an action item and I would imagine we could do a roll call vote with the amendments board members amended. I’m just moving the item as amended, madam chair. It’s been moved it’s been seconded, now we need to do a roll call vote Jennifer Ms. Paquin, aye. Mr. Yamanaka, aye Mr. Prezant, aye Ms. Yamamoto, Ms. Bradford Mr. Keiley, aye. Ms. Higa, Mr. Saha, ate Ms Miller, aye. Chairperson Hendricks, would you care to vote? Sure the motion passes Thank You Jennifer and Brian if it’s okay with you can we skip to item number 11 can we do 11 12 8 12b and then go back to 10 is that ok since that’s an information item I guess actually you gotta thank you because I don’t want you to lose your quorum, since let’s go ahead 11, Brian. Because some of the board members will be abstaining from from the

vote, this really has to do with reimbursement for the services that educated board members provide to the board and at the same time they are employed by a by educational institution by a county by a employer that contributes to our system and our statute the way it’s draft it allows for reimbursement for the cost of an employer to hire a replacement for such a board member an educator board member and it doesn’t really have any limitation on it so conceivably like statutes in other states it could be a hundred percent of the time in 2006 the board adopted a policy that really set forth some some percentages some of which was tied into various levels of participation such as being a chair of the board the investment committee or an individual committee and over the years we’ve seen a steady march and increase in percentage because we’ve seen a steady march and the challenges in the amount of time that educator board members have to spend on board business unfortunately away from the classrooms where they I think sometimes would prefer to be and so we’ve the last time we visited this two years ago we did extensive research on the amount of time and effort that educated board members were spending on board business the stakeholder and interest group engagements the educational requirements that just they amounted even in our survey up to 80% and in considering the revision to the policy the board also decided to eliminate the distinctions among the various levels of committee chair just recognizing that all educator board members are all in all the time and it was up to 80% and as you witnessed the last couple years the engagement and the stress and the amount of work for educating board members has greatly increased continues to increase and certainly as we’ve seen during this crisis I mean the board educated board members as many of the other board members have been all in all the time it’s required a tremendous amount of effort to steer this ship and it would not be fair to an employer if we would not be able to allow them to be or reimburse for a hundred percent of that activity by hiring a replacement so the proposal here is is really twofold one is to is to allow the reimbursement up to a hundred percent for the board activities of the educated board members educator board members and then also to approve that going forward it used to be a two-step process because you would do you would do the education I’m sorry you would do the appointment to committees in elections in this meeting and then you would adjust the reimbursement based upon those positions now since two years ago you eliminated that that tie it really would be just approving the reimbursement rates going forward so that’s why it’s it’s split in two processes one is to change a policy and then the other is to approve the reimbursement amount going forward so I happy to answer any questions I went through that rather quickly but I think is a pretty good historical description in the write-up so I’m happy to answer any questions Gail thanks madam chair I just wanted to move this item it’s been moved I second it Karen okay hey discussion and as I said I I will abstain I think I think the electives are abstaining from the vote so Jennifer if you wanna take a roll call sure uh miss take one aye mister Yamanaka hey mr. Prasad all right Maisie i’ma moto definitely I miss Bradford do you want to abstain his mom abstain mr. Keeley stay okay Missy go I yeah mister say huh I am miss Miller motion passes thanks Jennifer and then let’s do items 12 a and B Brian are you doing that Brian for me speaking of contracts requiring approval

no but I can well what-what are we there just means if someone wants to pull it does anyone want to follow those items then we can approve those own consent right yes let’s do that then we have to take a roll call vote for that or move items 12 and by being for to consent please yes and something for affirmation I need the language lawyers Brian help me out objection okay okay so Toby so we can go back to item Tanis Brian fiduciary counsel and I Betty’s not care about we just want to thank Betty and Bill for their work I believe it was an eight-hour it was almost as long as today but at least we we didn’t have the anti fossil fuel people but we had lawyers they talked just as much wouldn’t limit them to the three minutes though and this is an information item and Linda do my jumpin before Brian oh sure I just want on behalf of Betty you know she really appreciated the process and thought it was a great process and she’s pleased that now that we have a deep pool of firms drawn with the necessary experience of both to my benefit pension funds and also ESG issues so very pleased with the process okay yes and please tell her thank you for all her work and for you to Lynn we appreciate it Why we’re a good board, teamwork. All right I’m Brian well so Betty and Bill did a great job making the lawyers squirm which I thought was great we did have we did have a number of interviews we started out with 21 narrowed it down to 11 we ended up interviewing a number of firms in two in Sacramento and then for virtually and both Bill and Betty were very prescient about the issues that you’re going to be dealing with over the next few years and I could tell you that the selection of these counsel was from various levels of types of expertise that you may need to call on over the next few years so it was a it was a very good process we had some we have some very good candidates and they made good presentations. Bill and Betty are really tough questioners so you were well represented no lightweights got through so anyway this is the result, we we have good fee arrangements with these firms and we will have them on contract for you to use they understand they will understand that they represent you they will generally work through me but they do represent you and that’s very clear we’ll continue to make that clear that’s really all I have there’s any questions happy to answer any questions from board members none great thank you thank you you know is that we’ve had one fiduciary counsel for a very very long time and now we’ve changed to a pool model which I again I appreciate our willingness to adapt to new we have a different need at this point so we’re making changes so I really appreciate that change for us okay we are gonna stick in action here I think right item 12 items refer to Committee for board decision we have anything I don’t think so item 14 new business review of information requests Jennifer I did not have anything see anything and then we have the draft agenda for the next meeting yeah so the dates are July 6 7 8 and you know I think we all recognize from today that it’s at least two days to those three days if not more the items you see on this agenda the first ones are ones we always do in July which is the business plan which we’ve already

actually written that item for the most part number three and then the committee work plans that you would do with your key people those those evaluations are bumped from this meeting when we were trying to make this meeting the kind of short so uh there you go if possible some of these could be bumped also to September so I’ll work with Sharon and Perry on that and then the rest are just standard items okay I will comment we really thought we paired the agenda down and so I think again Harry and I’ll work with Jack for the July agenda but I do encourage you when Amy gives you that questionnaire after this meeting to give any helpful feedback that you think do you like the idea of two hours over if you know each day for three days or three hours for two days or really open to whatever works best for the majority of the board in terms of your brainpower and schedule and that kind of thing so open to ideas, Harry Thanks Sharon, thanks Jack I think Jack mentioned it something that will work on in the weeks ahead and he’ll probably come back in some some format it’s a draft agenda for July and we’ll reflect on what went well today and what’s necessary for the next meeting what doesn’t need to be on the agenda and the formatting of it so we’re kind of together and then bring it back most likely virtual as well. I don’t see any other hands so okay and opportunities for statements for the public and I think Brian let me know that there’s one person wanting to speak so Brian can you. I hear connection. Yes First of all thank you so much for all the work that you’re doing. I’m a member of CalSTRS I really appreciate all your hard work stewarding our retirement funds. I’m calling because I really want CalSTRS to divest from fossil fuels in the past three school years the sixth grade students at my school are will schools be closed for 15 days due to four different climate related disasters the Tubbs fire, the Russian River flooding the paradise fire and then most recently that Kinkaid fire, and as a sixth grade teacher I am I stand right at the interface for the generations and I’m charged with teaching objective climate science and many adult scientists experience trauma symptoms just sitting with and listening to the objective detached reality of the situation and I read the notes from your October 2019 off-site and I I really appreciate that you’re trying to mitigate risks and there’s tons of uncertainty but nowhere in those notes and nowhere in the counselor statement about sustainable investment did I see any mention of things that I know are certain the fossil fuel industry is responsible not just for fossil fuel pollution and driving this climate crisis but that has imprinted on the neuropsychology of our children and I hid in a sixth grade classroom in a way that I think a lot of people can’t see when I teach them objective clients and climate science everything that we’ve taught them about healthy learning communities about the core foundational beliefs and values that make our schools healthy places that is absolutely all thrown under the bus it is clearly generational neglect and I know that you have a policy of sustainable investment and I appreciate the intent behind that but the fossil fuel industry is clearly not capable of acting in the best interests of our children and so you can draw a bright line in the sand and I just encourage you to try to zoom out a little bit and think about drawing

this bright line in the sand for our children milling should be treating them this way and with that I believe each of you do every day and like how you transition to this you know especially supporting our children who really need their teachers in ways that I think you know it see how what how much you bring to them every day has been difficult and incredibly high opening and just filled me with gratitude so thank you very much Thank You California teachers, it is teacher appreciation week, thank you California teachers. We”l see you next time, bye

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