The CalPERS board on Wednesday decided to return the investment committee to a committee of the whole that includes all 13 members.
The investment committee of the $417.3 billion California Public Employees’ Retirement System, Sacramento, had been composed of a smaller nine-member panel that lacked final authority.
Committee member Margaret Brown during the governance committee meeting Tuesday said that the investment committee should be expanded to give the full board oversight. Even though any board member could sit in on an investment committee meeting, only committee members could vote or make motions, she said.
The board also changed its governance policy to make the hiring, evaluating and terminating of the CIO a shared responsibility between the board and the CEO. The CEO had previously had sole responsibility for hiring, firing and managing the CIO.
During the governance committee meeting Tuesday, CalPERS Board President Henry Jones suggested the change so the board would be involved in the evaluation of the CIO.
California state Controller Betty T. Yee during the governance committee meeting said she favored the change so the entire board could share the responsibility in all the facets of hiring the next CIO. Ms. Yee said the change would also relate to accountability, especially if the CIO is ever terminated.
The board also voted to give CEO Marcie Frost a 2019-‘20 incentive award of $100,617. There was no discussion and four board members voted against the award.
Ms. Frost’s base salary for the 2019-‘20 fiscal year was $343,949. Her incentive for the prior fiscal year was $99,920.
The governance committee also is expected to discuss in November whether the board’s pension and health benefits committee should be changed to include all 13 board members.
The item is being placed on the agenda at the request of board member Jason Perez. At Tuesday’s governance committee meeting, some committee members wanted to make the change but could not do so since the matter was not on the agenda.
In other news, CalPERS expects that a state bill it had sponsored to keep private some information about its private debt investments could be reintroduced in the next legislative session. The bill was pulled by its author in early August prior to being heard by the senate policy committee, Danny Brown, chief of CalPERS’ legislative affairs division, told the board on Wednesday.
“It had to do obviously with some of the news about CalPERS but also in light of ... COVID-19,” he said. “It just was a difficult time to really get out and advocate for a bill ... and know whether or not that bill was going to be successful,” Mr. Brown said in response to questions from board member David Miller. “All parties thought it would be best to wait and regroup and come back next year” if the board approves.
Mr. Brown said that he will return to the board to discuss introducing the bill “at the appropriate time.”
