CalPERS today approved a proxy voting strategy to withhold votes from external auditors that have conflicts of interest, defusing the pension fund's most contentious corporate governance policy from last year. The board also gave staff discretion to withhold votes from audit committee members in egregious cases. When asked whether this would include Warren Buffett, CIO Mark Anson responded: "We have not seen egregious conduct from Warren Buffett." The California Public Employees' Retirement System withheld its vote for Mr. Buffett as director of Coca-Cola last year, leading to widespread criticism.
Separately, Charles Valdes today was elected chairman of the investment committee of the $186.9 billion Sacramento-based fund, returning him to the position after a five-year absence and dashing expectations that fellow board member Priya Mathur would succeed Rob Feckner as committee chairman. George Diehr was elected vice chairman, replacing Ms. Mathur.
Also, CalPERS approved broad target ranges for subasset classes for its $115 billion global equity program. The target range will be 55% to 85% for passive investments; zero to 40% for enhanced index and active managers; and 4% to 12% for alternatives. CalPERS expects to pump more money into its $2.4 billion corporate governance investment program soon, including an increased allocation to SPARX Asset Management, which currently runs $300 million for the fund, said Christianna Wood, senior investment officer. Further information wasn't available.