Head of California pension fund travels to Swiss conference
Beleaguered Wall Street bankers might be staying away from this year’s World Economic Forum at Davos, the Swiss ski resort.
But that hasn’t discouraged Jack Ehnes, the chief executive of the California State Teachers’ Retirement System, from attending his fourth get-together of global movers and shakers from economics, business and government. The conference runs through Sunday.
Although his $134-billion fund, the nation’s second-largest public pension fund in assets, had lost about 25% of its portfolio as of June 30, the end of its last fiscal year, its board approved Ehnes’ request for the European trip, which is expected to cost around $4,000.
“It is a beneficial trip for us,” said Ricardo Duran, a spokesman for the fund known as CalSTRS. “It keeps us in the forefront of some of the issues the board has identified as being important and that they want to deal with -- one of them being climate risk.”
Duran also said Ehnes’ contacts with business and governmental leaders also were valuable.
During the invitation-only event, Ehnes is scheduled to make a speech on “financing low-carbon growth” and plans to present a paper about “green investing in 2010,” Duran said.
Although Ehnes is taking an active role in the 40th annual Swiss conclave, his counterparts at the country’s biggest government pension fund, the California Public Employees’ Retirement System, are staying away from the high-profile meeting. The $200-billion fund is embroiled in a controversy over multimillion-dollar commissions paid to middlemen from investment managers that help them secure business with CalPERS.
CalPERS’ portfolio is down about 20% from its 2007 peak.
“Given the current fiscal realities, we are trying to reduce the cost of travel,” said CalPERS spokesman Brad Pacheco.
Critics of California’s big pension funds, however, say they don’t have a problem with Ehnes’ attendance at Davos. “I don’t have a heartache with the money,” said Marcia Fritz, the head of Californians for Pension Reform, a group that is pushing to put two pension-related measures on the ballot. The proposed initiatives would reduce pension costs by delaying retirement eligibility for future state and local government and school district employees.
“I think it’s good that he’s going because the pension funds we have are international both in scope and size,” Fritz said. “I think it’s good for him to interface with other countries because he can see that the other funds are moving toward their members having longer working lives.”
Ehnes’ wife, Cindy -- the director of the California Department of Managed Health Care, which regulates health maintenance organizations and preferred provider organizations -- is also attending the Davos forum. Her office said she was traveling on personal business. Her expenses are not being paid with state or pension fund money, CalSTRS said.
