HUTCHINSON, Kan. — Kansas State Treasurer Steven Johnson is pleased so far with how his office is implementing the new Kansas Public Investments and Contracts Protection Act.
"What we know is we need the highest return investments at the lowest risk," Johnson said. "That's what we need. We don't need a policy mandate that says you must do x, y or z, whether or not you make money at it. We've got to look at, what works to feed the world, what works to fuel the world, then, for our assets, what gives us the highest return? The legislature passed a bill this last year, we implemented it in June and it took effect in July that in our investments, in our state contracts, we are neutral on the issue."
Environmental, social and governance (ESG) is a framework used to assess an organization's business practices and performance, but most ESG factors aren't tied directly to financial data. All the legislature wants Johnson's office to look at, is what makes the most money in the safest manner for Kansas.
"We look at what the return and risk are and we make the decision based on that," Johnson said. "The neutral piece relates to, we do not put an overlay of policy initiatives to make that decision. It is simply on the return and risk."
There are currently $25 billion in the KPERS trust fund.