Florida State Board of Administration's Investment Advisory Council hired Mercer for compensation consulting services in an effort that could produce recommendations to restructure staff pay levels.
The hiring, pending contract negotiations, appears to be the first time the IAC has independently sought and hired a compensation consulting firm, said Dennis D. MacKee, communications director of the Tallahassee-based FSBA, which oversees $154.3 billion.
Mercer's review will include benchmarking the compensation and pay structure for all FSBA staff positions to pension fund industry peers and to the regional market, Mr. MacKee said.
“Because it is compensation, and it has an impact all the way up to (Ashbel C. Williams Jr., executive director and chief investment officer), IAC wanted to make the hiring decision to ensure the integrity of the study so the people doing the study wouldn't be beholden to the people hiring them,” Mr. MacKee said.
In the study, Mercer also is expected to evaluate the compensation structure to assure it meets the organization's objectives of aligning interests within established risk guidelines.
The hiring was the result of a request for quotes the IAC issued in July to eight consulting firms, four of which responded. In addition to Mercer, the other three responses came from CBIZ, Evergreen Solutions and McLagan.
Under the current structure, the FSBA's board of trustees sets the FSBA budget, while delegating to Mr. Williams authority for managing and setting pay of all 183 FSBA professional and support staff, Mr. MacKee said. Mr. Williams serves at the discretion of the trustees, who set his compensation. The trustees appoint the nine-member IAC.
FSBA last updated its pay grades and ranges in 2006.
The IAC expects Mercer to present an interim study at its Sept. 17 meeting and a complete report at its Dec. 10 meeting. Mr. MacKee said.
