2016 Arizona Revised Statutes
Title 35 - Public Finances
§ 35-393.02 Investment; restricted companies list; notice; immunity; exception

35-393.02. Investment; restricted companies list; notice; immunity; exception

A. On or before April 1 of each year, each public fund shall prepare a list of restricted companies and shall provide a copy of the list on request.

B. In preparing the list of restricted companies, the public fund may consider at least the following:

1. Publicly available information, including information provided by nonprofit organizations, research firms and government entities.

2. Information prepared by an independent research firm retained by the public fund.

3. A statement by a company that it is participating in a boycott of Israel or that it has taken a boycott action at the request of, in compliance with or in furtherance of calls for a boycott of Israel.

C. The public fund shall notify each company that is included on the list of restricted companies that the company is subject to divestment by the state treasurer and the retirement systems.

D. If a company that receives notice pursuant to subsection C of this section submits a written certification to the public fund that it has ceased its boycott of Israel and will not engage in a boycott of Israel for the period of time that the state treasurer or a retirement system invests in the company, the public fund shall remove the company from the restricted list.

E. Each public fund shall:

1. Sell, redeem, divest or withdraw all direct holdings of a restricted company from the assets under its management in an orderly and fiducially responsible manner within three months after preparing the list of restricted companies pursuant to subsection A of this section. On or before August 1 of each year, the state treasurer and each retirement system shall post on their websites a list of investments that are sold, redeemed, divested or withdrawn pursuant to this paragraph.

2. Not acquire securities of a restricted company as part of its direct holdings.

3. Request that managers of its indirect holdings consider selling, redeeming, divesting or withdrawing holdings of a restricted company from the assets under its management.

F. With respect to any action performed pursuant to this section, the state treasurer, each retirement system and any person acting on behalf of the state treasurer or the retirement system:

1. Are exempt from any conflicting statutory or common law obligation or fiduciary duties with respect to choice of asset managers, investment funds or investments.

2. Are subject to title 12, chapter 7, article 2 regarding immunity for acts and omissions.

3. Are indemnified and held harmless by this state from claims, demands, suits, actions, damages, judgments, costs, charges and expenses, including attorney fees, and against all liability, losses and damages because of a decision to sell, redeem, divest or withdraw holdings of a restricted company made pursuant to this section.

G. This section does not apply to investments that are made by the state treasurer pursuant to section 35-314.01.