Ian D. Lanoff
Partner, Groom Law Group, Washington
Ian D. Lanoff changed the way pension funds invest and changed the capital markets, even though he wasn't an investment manager or consultant.
From 1977 to 1981, Mr. Lanoff was administrator of the Pension and Welfare Benefit Program of the U.S. Department of Labor, responsible for the development and administration of ERISA regulations and enforcement policies governing private pension and employee health and welfare plans.
Most pension plans had conservative investments before the passage of the Employee Retirement Income Security Act of 1974 and for the first years afterward.
Mr. Lanoff was instrumental in advancing the prudent man rule, allowing pension plan fiduciaries the latitude to invest in conventional publicly traded stocks and bonds, as well as alternatives.
Upon taking office, Mr. Lanoff directed his staff to "start looking at modern portfolio theory and the complaint that ERISA inhibits investment in anything but blue-chip stocks," a story in Pensions & Investments then noted.
In 1979, Mr. Lanoff issued a ruling on the prudence issue, which became the catalyst for pension funds to invest in such alternatives as venture capital, real estate and stock index-futures. Indexing also was an outgrowth of that ruling, although that was not envisioned at the time.
He entered private law practice in 1982.
"My hat's off to Ian. He did a great job," A. Richard Susko, partner with the New York-based law firm of Cleary, Gottlieb, Steen & Hamilton, said of Mr. Lanoff's work on the prudent man rule. "They managed to embrace a theory of the prudent man rule that considered an investment not as one investment but how it fits in a portfolio" in terms of its risk.