|[March 03, 2014]
CalSTRS Issues First Diversity in Investment Management Report to Legislature
WEST SACRAMENTO, Calif. --(Business Wire)--
The California State Teachers' Retirement System (CalSTRS) today
submitted its first report to the California Legislature outlining
progress in bringing emerging managers into the stewardship of its
The report, "Diversity
in The Management of Investments 2014 Progress Report," is a
requirement under Senate Bill 294, which became law in 2011. It
nonetheless reflects CalSTRS' strategic goal, since 2003, to bring
greater diversity to its external investment management.
"Reflecting the philosophy of inclusion ingrained in the work and the
ranks of California's educators, CalSTRS seeks to increase the
participation of emerging investment managers, while enhancing returns
at a prudent level of risk," said CalSTRS Chief Investment Officer
Christopher J. Ailman. "That diversity mindset extends to our 108-strong
CalSTRS investment staff, comprising wide-ranging backgrounds and
CalSTRS' strategic goals on diversity fall into three broad categories:
CalSTRS investment staff.
The challenges identified in the "four pillars" of real estate,
corporate governance, global equity and brokerage services.
CalSTRS' foundation of existing programs.
CalSTRS employs four initiatives imed at increasing the diversity of
its investment staff. They are the development of recruitment strategies
to attract a diverse workforce; development of training programs to
facilitate hiring recent California university graduates; creation of
staff training and development programs to retain staff and attract
civil servants from other disciplines; and maintenance of internship
programs with surrounding universities.
The four pillars-real estate, corporate governance, global equity and
brokerage services-present some of the toughest challenges to
incorporating diversity in the management of investments across the
CalSTRS portfolio. CalSTRS focuses on meeting four goals. They are:
Increase the diversity of real estate external managers handling
Increase the diversity of corporate boards of directors.
Develop a direct relationship program with equity managers to move
managers from the CalSTRS Developing Manager Program to CalSTRS' core
Increase the diversity of firms providing brokerage services to
The report also sets out the foundations of CalSTRS' focus on diversity
through its existing programs, which are:
The Private Equity Proactive Portfolio.
The Global Equity Developing Manager Program.
Fixed Income direct relationships with diverse managers.
Local community college internships.
Active participation in industry organizations.
"However we approach our goals, we keep in mind the CalSTRS core value
of strength, which says, 'We ensure the strength of our system by
embracing the diversity of ideas and people,'" Mr. Ailman said. "It's
why we continue to be recognized as an industry leader. We don't rest on
our laurels, and developing new, diverse and talented asset managers is
a key part of our strategic plan."
CalSTRS' leadership in diversity is award-winning and has been
recognized with several recent accolades, including:
November 2013 - CalSTRS received the Association of Asian American
Investment Managers Champions award.
November 2012 - New America Alliance Pension Leadership Award for
Promoting Latino Advancement, presented to Solange Brooks of CalSTRS
Investments Executive Unit.
April 2012 - CalSTRS Corporate Governance Investment Officer Aeisha
Mastagni was awarded the aiCIO magazine's "Top 40 under
State Teachers' Retirement System, with a portfolio valued at $176.2
billion as of January 31, 2014, is the largest educator-only pension
fund in the world. CalSTRS administers a hybrid retirement system,
consisting of traditional defined benefit, cash balance and voluntary
defined contribution plans. CalSTRS also provides disability and
survivor benefits. CalSTRS serves California's 868,000 public school
educators and their families from the state's 1,600 school districts,
county offices of education and community college districts.
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