Tesla has recruited Hiromichi Mizuno, former chief investment officer of the $1.5 trillion Japanese Government Pension Investment Fund (GPIF), to serve as an independent director on its board and join the board’s audit committee.
Mizuno served as GPIF’s CIO from January 2015 until March of this year, after having had his contract extended by six months past its initial expiration date set in October 2015. He was recently replaced by Goldman Sachs veteran Eiji Ueda, who is contracted to serve for two years.
“[At GPIF], Hiro emphasized the importance of environmental considerations in portfolio management and became a global though leader in sustainable and responsible investment practices,” Tesla said in a statement regarding Mizuno’s recruitment. “He also challenged many established market practices, including short-selling, to promote long-term value by corporations.”
Tesla CEO Elon Musk recently offered public praise for Mizuno and his team after they announced their decision to suspend the firm’s stock lending program, which is used to facilitate short selling programs.
“The stock lending scheme lacks transparency in terms of who is the ultimate borrower and for what purpose they are borrowing the stock,” GPIF said in its December announcement of the suspension.
The fund cited concerns over whether the short selling industry is hurting the companies they are trying to benefit, which would be “considered inconsistent with the fulfillment of the stewardship responsibilities of a long-term investor,” the fund said.
Musk replied to GPIF’s announcement two days later on Twitter saying, “Bravo, right thing to do! Short selling should be illegal.” Being at the forefront of one of the world’s most influential sustainable transportation vehicle companies, Musk has repeated over the years that short selling hurts Tesla’s growth.
Mizuno is a proponent of environmental, social, and governance (ESG) investing and spearheaded the investment of ¥3.5 trillion ($32.4 billion) in assets under management (AUM) tracking ESG indices. He recently announced that four out of five of these indices are outperforming their parent indices and market averages over the past two years.
GPIF is the world’s largest public pension fund and owns approximately 10% of Japanese equities and 1% of global equities.