CalPERS is closer to selecting a new CIO, with finalist interviews by the CEO and full board scheduled for mid-December, CEO Marcie Frost said at Wednesday's board meeting.
A first round of interviews with "several candidates" was conducted by a board subcommittee during the first week of November. According to a timeline of key milestones presented to the board at an off-site meeting in July by Ms. Frost and Dore Partnership, CalPERS' executive search firm.
Following the finalist interviews, the next steps are candidate acceptance, with a new CIO joining CalPERS as early as March. This means the new CIO could join the same month the staff is scheduled to present an implementation plan for its new asset allocation, which includes 5% total plan leverage.
The $495.3 billion California Public Employees' Retirement System, Sacramento, has been without a permanent CIO since former CIO Yu "Ben" Meng suddenly resigned in August of 2020.
This is CalPERS officials' second attempt to hire a replacement. The original search process was halted in March, after a subcommittee that included Ms. Frost had whittled down the candidate pool to three finalists. That search was halted without making an offer due to the global pandemic and lack of clarity on whether the new CIO would participate in a long-term incentive program. In April, the board added a long-term incentive program to the CIO's compensation package starting in the 2022 fiscal year. CalPERS restarted the search in July.
CalPERS declined to provide information on the current number of finalists.
Separately, also at Wednesday's board meeting, Ms. Frost announced preliminary returns for periods ended Sept. 30: 17.2% for one year, 10.2% for three years, 9.8% for five years and 9.5% for 10 years.
At the same meeting, Marlene Timberlake D'Adamo, CalPERS' chief diversity, equity and inclusion officer, reported that in fiscal year 2021 CalPERS voted against 197 directors at companies where its diversity engagements had not resulted in changes. CalPERS voted against 54% of executive compensation proposals where executive pay was not aligned with company performance. By comparison, CalPERS voted against 51% executive compensation proposals for poor pay-for-performance alignment in fiscal year 2020 and 52% in fiscal year 2019.
