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Missouri treasurer wants private equity fee reporting system for state pension fund

Missouri Treasurer Clint Zweifel
Missouri Treasurer Clint Zweifel

Missouri Treasurer Clint Zweifel sent a letter on Wednesday to the $9 billion Missouri State Employees' Retirement System, Jefferson City, requesting it formulate a system to measure the total fee cost of private equity investments.

The request follows Mr. Zweifel adding his name to the letter sent Tuesday to SEC Chairwoman Mary Jo White by a number of state and municipal treasurers and comptrollers calling for an industrywide standard to give private equity limited partners more transparent and frequent information on fees and expenses.

“I am excited to work with MOSERS, continuing leadership and strengthening transparency and accountability for Missouri taxpayers and retirees,” Mr. Zweifel said in a news release. “MOSERS has already done great work to protect the beneficiaries of the state pension fund, and I am confident we will be able to find a path forward to enhance financial security for Missourians.”

Mr. Zweifel is a trustee on the MOSERS board and chairman of the pension and trust investment committee of the National Association of State Treasurers.

“The thing I hope people understand is that our activity is net of fees,” said Gary Findlay, MOSERS executive director, in a telephone interview, “so essentially what's happening is, if you better identify the additional fees beyond what we're able to capture, all it means is your gross return increases and your expenses increase and your net of fees remain the same.”

“With that said, there is probably merit in having better identification as to what the fees are and we certainly endorse that,” Mr. Findlay added.

As of March 31, the pension fund's actual allocation was 29% inflation-indexed bonds, 22% illiquid investments, 17% nominal bonds, 15% alternative betas, 9% global equities and 8% commodities.

Targets allocations are 30% inflation-indexed bonds, 20% illiquid investments, 18% nominal bonds, 15% alternative betas, 9% global equities and 8% commodities.