The California Public Employees’ Retirement System (CalPERS), has authorized staff to invest up to $600 million alongside successful partners in the CalPERS Corporate Governance Programme.
This is due to reports that 10 external corporate governance funds have achieved annualized returns of 17.7 percent from their inception in January 1999 through to March 31, 2006 . This is almost three times more than the industry benchmark.
CalPERS staff will draw the $600 million from domestic and international equity passive accounts to augment $4.4 billion currently allocated to the Corporate Governance Programme.
“The figures tell the story, and it’s all good news,” says Rob Feckner, the Board President of CalPERS. “By improving poor financial performers, our corporate governance investments show that we can do very well by doing good in the marketplace.”
“We’re looking for continued good returns for corporate governance funds, considering their extraordinary results, especially for co-investments,” adds Charles P. Valdes, Chair of the CalPERS Investment Committee. “Expanding this programme is a good idea.”