The National Conference on Public Employee Retirement Systems on Thursday released its governance best practices for public pension fund officials.
NCPERS, with more than 550 U.S. and Canadian public pension fund members managing $3 trillion in assets, developed the guidelines with Marco Consulting Group.
NCPERS' best practices include establishing a chief risk officer role with centralized accountability; and fiduciary training and risk assessment initiatives across administrative, member service and compliance functions.
NCPERS cited research showing that effective governance may improve investment returns by up to 1% to 2.4%, annually. The practices were developed to avoid the private-sector governance lapses that contributed to the financial market losses that saw pension losses of as much as $4 trillion worldwide.
“Public pension funds play a leadership role in delivering high quality, cost-effective benefits to their members through effective oversight, accountability and transparency,” Hank Kim, NCPERS executive director and general counsel, said in a statement. “These practices are intended to contribute to these outcomes as the markets and the economy evolve.”