CalPERS' private equity investment staff is seeking permission from the pension fund's investment committee to enter into bigger monetary relationships without investment committee approval as part of an effort to reduce the number of its general partners.
The agenda for the investment committee's meeting on June 16 includes a resolution giving the investment staff the authority to invest up to 15% of the private equity program's approximate $31 billion in committed capital to one general partner, an increase from the current 10% limit.
Commitments higher than the 15% would require approval from the board of the $295.5 billion California Public Employees' Retirement System, Sacramento.
The agenda item says the policy change would support shifting the overly diversified private equity portfolio to one that has larger commitments while reducing the number of general partners.
Real Desrochers, senior investment officer, private equity, told the CalPERS investment committee in December that a future goal is to reduce the number of managers to around 120 from almost 400.
The agenda item also would increase the maximum amount that could be committed to a second-tier general partner to 2% of the private equity policy target from 0.75%. The agenda item says that move would also help consolidate the private equity portfolio.
