The origins of Pensions & Investments go back more than 50 years before we started the publication in 1973.
My dad, the late G.D. Crain Jr., who founded our company in 1916, ran a business-writing news service in Louisville for several years prior to his launching our first publication, Hospital Management. He and his staff served as the Louisville correspondent for over 100 trade papers, one of which was National Underwriter, then and now a major insurance newspaper.
Dad thought how unfair it was that corporate insurance managers didn't have a publication edited for their needs, just as National Underwriter was edited for insurance agents and brokers. He determined that one day, when he could afford it, he would start a publication for corporate insurance managers -- the buyers, not the sellers, of insurance.
Fast forward to 1967. On a winter day in Chicago I was riding in the car with my dad when he asked me whether I'd be interested in editing a publication he had in mind that he wanted to call Business Insurance. It was the idea he had kept on ice for 50 years.
I was then a 29-year-old reporter for our flagship publication, Advertising Age, and his job offer sound to me like a good opportunity for advancement.
So I eagerly accepted the job, not knowing anything about insurance. I remember spending the first day in my new job trying to figure out how to spell "Marsh & McLennan," the big insurance brokerage firm.
One of the missions of Business Insurance was to cover not only the property and casualty side, but also the life and health side of corporate insurance buying -- the employee benefits package. Part of employee benefits was pension and profit-sharing plans.
We reported on pension plans from the standpoint of what benefits they offered employees. But I noticed we were running across many possible stories about how companies invested all of that pension fund money and what kind of results they derived.
But Business Insurance didn't seem to me to be the place to report this information, because the employee benefits manager more often than not didn't have anything to do with the investment aspects of the pension plan.
So I thought that we needed to bring out a separate publication that would cover the escalating costs of operating pension and profit-sharing plans and the impact of investment returns (or lack thereof) on corporate bottom lines. We also wanted to report on activities in Washington that would lead to more disclosure of pension plan investment results.
Steve Gilkenson, who took over as editor of Business Insurance, and Al Malecki, publisher of BI, were entrusted with the responsibility for researching the feasibility of the spinoff.
As Steve recalled: "We knew it would not be an easy sell because we were on the threshold of a protracted bear market, which deflated enthusiasm for new ideas with the Wall Street crowd -- our target for advertising support. Nevertheless, we naively charged ahead, boldly telling our story to all who would listen at bank trust departments, insurance companies and money management firms."
Our early research was not very encouraging -- and one lunch we had in the summer of 1973 was very discouraging. It was in the paneled executive dining room of a large New York City bank. We had invited ourselves there to talk about our idea with a staid group of bankers who managed (poorly, it was believed) one of the biggest pools of pension assets in the nation. They most likely cooperated with our request for an audience to find out what we were up to.
Let Steve tell the rest of the story: "We laid out our plans to report comings and goings in the business and dig into the nuances of investment performance and how pension plans could be more efficiently managed. The lack of enthusiasm was deafening, and I will not forget the parting words of the public relations man who had set things up. 'Good luck,' he said, shaking my hand. 'However, I must tell you that getting people to give you the information you want to put in your magazine will be as difficult as spreading the membrane of a gnat's brain over the hood of a Volkswagen.' "
Steve did an outstanding job of keeping our ship afloat in those early years, aided and abetted by three other skilled and persistent journalists -- Mike Clowes, executive editor, who came to us from Forbes; Steve Yahn, managing editor, who joined us from the Chicago Daily News; and Julie Rohrer, senior editor.
Mike, Steve and Julie "caught the vision, and each was extraordinarily good at developing reliable sources among a small group of insiders wired into a tight-lipped market," Steve Gilkenson said. "A most important contribution of P&I in those early years was to take investment performance information of pension funds from (figuratively speaking) the back of napkins to the light of marketplace accountability. That was due largely to the relentless pursuit of the subject by Mike Clowes, who assembled quarterly reports on investment performance against all odds."
Our very first issue created controversy. One of the unreported corners of the pension fund business was the hirings and firings of investment advisers, and we boldly wrote a front-page headline, "IH (International Harvester) dumps Harris, two other managers." That's the way we chronicled the ad agency world in Advertising Age, but we quickly discovered the pension world wasn't quite ready for such flamboyance.
It's always a reporter's dream to shed a little light on a business that had been secretive and uncommunicative, and I'm very proud of the contribution we've made to help put the spotlight on pension plan investment results for betterment of the plans themselves, the companies that contribute to them and, most of all, the benefit recipients.
Steve Gilkenson, by the way, after becoming group publisher of our company, left in 1991 for a greater calling: He became director of ministries of the New York City Mission, which provides meals, clothing and shelter to the homeless on a budget of $1.5 million. Talk about a good return on investment.