Broward Health System, Fort Lauderdale, Fla., terminated Fisher Investments for management of a total of $104 million the firm manages for the $375 million Broward Health Pension Fund and the $595 million Broward Health Unrestricted Fund.
Broward Health System is the most recent of 11 asset owners and two money managers to terminate Fisher Investments for a total of $3.1 billion managed in active equity strategies.
Like other asset owners, Broward Health System's board of commissioners voted at its meeting Wednesday to terminate the active equity manager immediately because of lewd comments made by Kenneth L. Fisher, the firm's executive chairman and co-chief investment officer, at a conference earlier this month, a video of the meeting posted on the system's website showed.
"I felt like this was something that should come to this board," said Commissioner Christopher T. Ure in the video. "It's really not specifically an investment issue. It's more … the association of this organization with Fisher Investments, whose head, Ken Fisher, made some really shocking comments. I'm not easily shocked, to be honest, but it was really over the top."
As of June 30, Fisher Investments managed $36 million in active international equities and $22 million in U.S. smidcap value equities for the system's Unrestricted Fund and $25 million in U.S. smidcap equities and $21 million in international equities for system's defined benefit plan, the system's most recent investment report showed.
Mr. Ure said although the system's pension and investment committee has primary authority for investment decisions, he felt it was important for the full board to make this resolution.
The investment committee likely will choose index funds in similar styles in which to park the assets liquidated from Fisher Investments and then determine how to go forward with a manager search at its next meeting, Mr. Ure said. The search for new managers to take over portfolios managed by Fisher Investments will likely take three to four months to complete.
Fisher Investments spokesman John Dillard could not be immediately reached for comment.
Separately, during a board meeting Thursday, trustees of the $2.6 billion Chicago Policemen's Annuity & Benefit Fund, ratified the recommendation Monday of its investment committee to place Fisher Investments on its watch list for management of $66 million in U.S. smidcap equities.
In a statement, Erin Keane, the fund's executive director, said the board "is troubled by Ken Fisher's remarks …(which) are not appropriate in any forum and … are inconsistent with the core values and beliefs of the fund and its board of trustees."
Ms. Keane said the board will require that Fisher Investments appear before the investment committee as part of the fund's ongoing investigation.
Ms. Keane said in the statement that Fisher Investments "will be expected to respond to recent events and explain what actions the firm has taken internally to address Mr. Fisher's conduct and promote a diverse and inclusive culture." After the discussion with Fisher Investments, the board "will decide what action to take, up to and including terminating its relationship with Fisher Investments," she said.
Earlier this month, NEPC, the plan's consultant, issued a memo to its clients invested in Fisher Investments recommending the firm's termination.
