Vermont State Teachers' Retirement System, Montpelier, made a preliminary selection in its search for a manager to run about $100 million in active international large-cap equities for the $1.2 billion system, said Jeb Spaulding, state treasurer; he declined to identify the firm. The fund interviewed finalists Acadian Asset Management, GMO, Mondrian Investment Partners, Pyrford International and UBS Global Asset Management on Monday. Assets will come from reducing State Street Global Advisors' $114 million MSCI EAFE index fund. Mondrian already manages $115 million in an active international value portfolio. The specific mandate for the new manager has not been finalized.
The board asked the finalists about their positions on the Bush administration's proposal to partially privatize Social Security. Four of the firms had "absolutely" no connection to any parties interested in privatization and were not promoting it, and one "had a mixed past" on the issue but assured the board it was not promoting the plan, Mr. Spaulding said.
On Tuesday, the board approved a resolution that it would "carefully consider the activities and involvement of investment firms in efforts to promote privatization during the selection and retention process of such firms" when searching for managers. The resolution said Social Security privatization is not in the interest of pension fund members.
Mr. Spaulding added he was confident that a firm's stance on the subject would not be a defining factor in hiring or not hiring a manager.