MassPRIM gets closer to naming new CIO

MassPRIM’s executive director Michael Trotsky would assume the role of chief investment officer less than a year after the departure of Stanley Mavromates.

The Massachusetts Pension Reserves Investment Management Board’s investment committee recommended Michael Trotsky for the role of chief investment officer, spokeswoman Chandra Allard told Private Equity International

Trotsky will have to receive a similar recommendation from the audit and administrative committees before the appointment can be approved by the board at its 2 October meeting, according to Allard. His responsibilities would include overseeing the system’s $5.8 billion private equity portfolio. 

Trotsky is currently the $49 billion retirement system’s executive director, a role he would retain if he were approved as CIO. He took that position in 2010 after working as the executive director of the Massachusetts Health Care Security Trust, where he was responsible for the investment and management of the State Retiree Benefits Trust Fund as well as payments the state received through a tobacco litigation settlement. 

He also has investment experience as a portfolio manager at PAR Capital Management, an analyst at Greenberg-Summit Partners and as a senior vice president at Independence Investment Associates. 

Trotsky has been MassPRIM’s interim CIO since May, when Stanley Mavromates left to take a similar role at consultant group Mercer. The retirement system has struggled to retain senior investment staff over the last year; Mavromates’ departure was MassPRIM’s third in nine months. 

Michael Langdon, previously senior investment officer for private equity, left in 2011 to help launch Hermes GPE’s new Boston office. Wayne Smith, who had headed MassPRIM’s private equity portfolio, left last August to join fund of funds manager Pathway Capital Management. 

The departures are symptomatic of public pensions’ ongoing “brain drain”, in which talented investment officers leave their respective retirement systems for more lucrative positions in the private sector. 

In an effort to stem that tide, both the Orange County Employees’ Retirement System and the Florida State Board of Administration announced plans last month to undergo a review of their investment staff’s compensation. The reviews may lead to changes such as performance based pay, which may incentivise staff to remain in their current positions.