CalPERS today approved a $1 billion increase in its absolute-return program, raising the total hedge fund allocation to $2 billion. The increase includes a first-time $500 million allocation to hedge fund of funds; CalPERS staff believes it will help pump more money into the area and will boost the program's impact on fund performance.
The board of the $177 billion California Public Employees' Retirement System, Sacramento, also adopted a three-year plan to rein in excessive executive pay practices. Under the plan, CalPERS will submit a sweeping compensation proposal to the SEC next year, seek support from stock exchanges in requiring tougher disclosure standards, and press the compensation consulting industry for reform. In addition, the strategy will create a focus list for companies with poor pay practices, target corporate compensation committees and establish awards for companies with exemplary practices.
The CalPERS board also approved renewing contracts for six international fixed-income managers that run a combined $5.9 billion. The managers are Baring Asset Management, Bridgewater Associates, Julius Baer Investment, Rogge Global Partners, Wellington Management and Western Asset Management.
