Rhode Island State Investment Commission, Providence, approved a new investment policy put forth by state Treasurer Seth Magaziner requiring transparency from investment managers, said Mr. Magaziner.
Mr. Magaziner's “Transparent Treasury” initiative requires money managers wishing to do business with Rhode Island to publicly disclose information about their performance, fees, expenses and liquidity. Going forward, all fund managers will be required to sign a transparency pledge, agreeing to the release of this information before they will be allowed to oversee Rhode Island state investments.
The initiative also includes the creation of a new investment information center on the treasurer's website and new data portal that offers access to state treasury information.
At investment commission's monthly meeting Wednesday, Mr. Magaziner asked the commission to formally adopt his new policy. The commission voted unanimously in favor of adopting the initiative.
“Going forward, Rhode Island will only do business with fund managers that allow us to publish information on performance, fees, expenses and liquidity,” said Mr. Magaziner in a phone interview.
In addition to requiring disclosures of all new funds in which Rhode Island invests, the treasurer's office is currently in the process of reaching out to the state's existing fund managers to ask them to voluntarily meet these new standards for current investments. Going forward, existing managers would also be required to provide the information for new investments, Mr. Magaziner said.
As a part of Mr. Magaziner's transparency initiative, the treasury office will begin reporting fund expenses at an aggregate level immediately and on a fund-by-fund basis later this year.
“I'm hoping this will lead to better financial performance for Rhode Island and other states,” Mr. Magaziner added. “The more information out there, the more leverage we and other pension plans will have in our negotiations to get better terms on fees and other factors.”
The investment commission manages the $8.3 billion Rhode Island Employees' Retirement System, Providence.