Iowa Public Employees’ Retirement System, Des Moines, rejected hiring Holland Park Risk Management as the $21.1 billion fund’s first risk management consulting firm but will review the issue further, according to Judy Akre, IPERS director of communications.
IPERS issued an RFP in October for a risk management consulting firm.
Other firms that submitted qualifying proposals were Russell Investments, McKinsey, Gifford Fong Associates, and M-Cube/Alpha Engine, Ms. Akre said in an e-mail.
The board voted 3-2 against the evaluation committee’s recommendation to hire Holland Park at a Jan. 19 meeting, she said.
Because two board members who supported searching for a risk management consulting firm were not available for the meeting, Michael L. Fitzgerald, Iowa state treasurer and board chairman, decided to place the issue on the agenda for review at the board’s March 25 meeting, she said.
Of the members opposed to the hiring, “one board member indicated he still did not fully understand what a risk management program would accomplish, and did not feel comfortable voting for it,” she said. “Another board member had concerns about spending money on the project during tough budget times, as well as some concern about the contractor’s expected outcomes. The other board member did not voice any of his concerns.”
At the time the RFP was issued, Karl Koch, IPERS chief investment officer, noted, “We are looking for a consulting firm that can facilitate an in-depth review and discussion on investment risks for board and staff, and help us develop a better sense of the system’s risk appetite and what strategies we could use for managing those investment risks. I view it much like a strategic planning exercise, except this will focus on investment risk.”