Mercer adheres to values
The Sept 3 issue of Pensions & Investments carried an editorial column referencing our firm's work on behalf of the Public School Teachers' Pension and Retirement Fund of Chicago. While, as a matter of policy, Mercer does not comment publicly on specific client issues without a client's consent, we feel it is necessary to provide some context to the issues in question. (Accordingly, we obtained permission from the Chicago teachers' board before submitting this letter.)
First, we wish to express our disappointment that the column was ever published in the first place. The letter it referenced was not from our client, the Chicago teachers' board, but from an individual trustee who had not yet discussed it with the board as a whole. This letter contained many factual errors. We have addressed all of these allegations directly with our client, the board. In fact, the board has just renewed our contract for another two years.
We recognize that the column's central issue - the potential for conflicts of interest within the investment consulting community - is a very important one and warrants close attention and discussion. Any business that provides integrated, multidisciplinary services to clients, domestic or global, will inevitably come across possible conflicts of interest. Adherence to three key principles is critical in running such multiple lines of business:
* Establish an internal governance structure and procedures to ensure that conflicts of interest do not arise.
* Disclose fully any potential conflicts of interest to all clients (existing and new).
* Most important, keep the best interests of the client in mind at all times.
William M. Mercer Investment Consulting is rigorous in adhering to these principles and strongly supports the continued discussion and debate of evolving industry best practices in this regard.
The 500-plus employees of William M. Mercer Investment Consulting are proud of the services we provide to our clients in the U.S. and abroad, and extremely proud and honored to have the opportunity to serve them.
Barry McInerney
U.S. practice leader
William M. Mercer
Investment Consulting Inc.
New York
AIMR strict on ethics code
In his Oct. 1 letter to the editor, Bruce Jacobs, a member of the Association for Investment Management and Research, alleges violations of the AIMR Code of Ethics and Standards of Professional Conduct by AIMR members and makes recommendations for how AIMR should handle those allegations. As we informed Mr. Jacobs previously, as well as Barry Burr when he interviewed me for articles appearing in Pensions & Investments, allegations of violations of the Code & Standards are governed by, and handled by, the AIMR Professional Conduct Program in accordance with the Rules of Procedure for Proceedings Related to Professional Conduct and the AIMR Bylaws. (Both the Rules of Procedure and the AIMR Bylaws are available to the public on the AIMR website, www.aimr.org/standards/
ethics/conduct.)
According to Rule 12 of the Rules of Procedure, all proceedings conducted pursuant to the Rules of Procedure are confidential and the records of proceedings shall remain confidential and shall not be made public. What this means in plain English is that, with the exception of the Designated Officer, Professional Conduct Program staff, and members of the relevant Professional Conduct Committees established by the AIMR Board of Governors, no one, including any complainants, can or will be advised regarding the existence, status or outcome of a professional conduct complaint, unless the matter results in a public sanction of an AIMR member. All public sanctions of AIMR members are published in our member newsletter, the AIMR Exchange.
AIMR does hold itself, its leaders and its staff to the same high standards to which it holds all AIMR members. Therefore, regardless of a complainant's or the press' wish to take an issue public, we must, and will, strictly adhere to the Rules of Procedure including the rule regarding confidentiality in order to maintain the integrity of the AIMR Professional Conduct Program, even though it means leaving public accusations unanswered.
Patricia Doran Walters
designated officer
AIMR Professional
Conduct Program
senior vice president
AIMR Professional Standards
and Advocacy
Charlottesville, Va.
