The adopted practices will also eliminate the pension fund’s watch list process ( and replace it with a quarterly performance report) and establish a spring-fed pool of qualified managers.That allows managers who meet minimum qualifications and scoring standards to be part of the pool for up to five years. Managers may not be funded but remain under contract and available for funding.
The changes were made after CalPERS investment staff surveyed numerous public and corporate pension funds and endowments to compare external manager practices to CalPERS practices.
“The way in which we have administered our external management program has not changed in 15 years,” said Sean Harrigan, CalPERS Board President, in a press release. “These changes bring us up to date with industry standards and I’m confident that will translate to improved performance, more efficient administration and enhanced perception of CalPERS as an attractive and valuable client by money managers.”
Currently, CalPERS has 60 accounts with external money managers that invest more than $47 billion in US and international equity and fixed income.