CalSTRS removed from emerging managers workshop

The California Public Employees’ Retirement System will go it alone on an emerging manager workshop that had been billed as a joint effort with the California State Teachers’ Retirement System.

Parties are usually a lot more fun when you invite people.

In September, the California Public Employees’ Retirement System announced that it would be partnering with the California State Teachers’ Retirement System to host a workshop for emerging managers. One problem, no one told CalSTRS about the event.

“I think it was a mistaken assumption from [CalPERS] that we were part of it,” CalSTRS spokesman Ricardo Duran told Private Equity International. “As far as I know, there was an assumption they would reach out to us, but I don’t believe they ever did.”

CalPERS has since removed CalSTRS’ name from the event, which is scheduled for 3 December. CalPERS spokesman Brad Pacheco attributed the error to a communication breakdown between the retirement systems.
CalSTRS will not be hosting an emerging manager workshop anytime soon, Duran added.

“We’ve got our own programme, we’re pretty happy with it, and we don’t feel any need to do a workshop,” he said.

The workshop will allow emerging managers across asset classes to acquaint themselves with CalPERS’ investment programme, providing insight into how the $240 billion retirement system assesses investment opportunities. 

“We have heard loud and clear from the emerging manager community that we can do a better job with our external outreach,” said CalPERS chief investment officer Joe Dear. “As we’ve detailed in our Emerging Manager Five-Year Plan, we will increase our communication, marketing and networking with the emerging manager industry and this workshop is a continuation of our work to that end.”

CalPERS’ relationship with private equity’s emerging manager community has strained recently, several sources have told Private Equity International. Although the retirement system is still a significant investor in emerging managers, the system's future commitment pace will be significantly lower than the $1 billion it committed to its private equity emerging manager fund of funds programme, called the Capital Link funds, which was managed by Centinela Capital Partners.

Last year, CalPERS awarded a $100 million emerging manager mandate to Credit Suisse. Credit Suisse is also taking on the Centinela portfolio, after the system terminated its relationship with the fund of funds earlier this year.