State Universities' Retirement System of Illinois, Champaign, plans to develop a new approach for hiring minority and other emerging managers, said James Hacking, executive director of the $6.8 billion fund. The system has dropped its last minority manager - Holland Capital Management, which ran $34 million. Among the ideas the board is considering: using a manager-of-managers approach; choosing a firm specializing in the area; or hiring someone in-house to identify minority and emerging managers, handle searches and make recommendations. Mr. Hacking said the board could decide to use a combination of approaches. It could make a decision in December.
In addition to Holland, the system dropped two other domestic equity managers - Fisher Investments, which ran $34 million, and Rosenberg Institutional Equity Management, which ran $102 million. Proceeds from all three portfolios will be placed with the system's $2.4 billion in index funds managed by BZW Barclays Global Investors.
California State Teachers' Retirement System, Sacramento, scheduled interviews for the CIO position now held by Thomas E. Flanigan. Interviews are scheduled for the second week of November. Mr. Flanigan - whose contract with the $62.5 billion fund expires on Dec. 12 - is one of the candidates, but the number of other candidates being considered wasn't available.
Mr. Flanigan's current total compensation is $226,500 per year. The new contract will probably run for three years with options for extensions.
The board also approved a new CIO pay package and a change in executive structure. The CIO's base annual salary was increased to $230,000 from $185,000 and a performance bonus of 10% of base salary. The CIO also will now report to CEO James Mosman instead of directly to the board.