CalPERS Pension Fund Names an Insider, James E. Burton, as New Chief : Investment: His predecessor hectored corporate boards to look after shareholders. Burton says he will be low-key.
The California Public Employees Retirement System, the nation’s largest public pension fund, said Friday that it has selected insider James E. Burton as chief executive of the $80-billion fund.
Burton, 43, who had served as CalPERS’ assistant executive officer for investment operations, said he will focus on improving the fund’s operations and use of technology. Unlike his predecessor, Dale M. Hanson, Burton said he will play a much less visible role in promoting shareholder rights and the corporate governance movement, which seeks closer supervision of the management of publicly held companies.
But CalPERS’ own programs to promote corporate governance will continue, Burton said.
Hanson, who left CalPERS in May to run a private investment firm in San Diego, used his post and media savvy to become a prominent advocate of shareholder rights.
Under Hanson, CalPERS used its giant portfolio as leverage to pressure the directors of General Motors, International Business Machines, ITT, Occidental Petroleum, Lockheed and other corporations to become more independent of management and more accountable to shareholders.
“Dale was the star, and everything he did was written about,” Burton said. “I’m a little more low-key. I do not intend to spend much of my time with the media. (Corporate governance) will work without a star.”
Burton, who will earn $110,000 annually plus bonuses, was selected after a three-month search by the Sacramento-based organization, which administers the retirement, health and other benefits of more than 1 million members employed by a wide variety of public employers.
“Jim brings the experience and perspective as both board member and staff to the position,” William D. Crist, CalPERS president, said in a statement. “He has a clear grasp of the major issues confronting CalPERS. His insights and opinions are very much respected by the board.”
Burton also won praise from a wide variety of outside investment officials and state employee groups as an energetic and knowledgeable financial manager.
“He has a lot of integrity and is a straight shooter,” said Bob Zenz, general manager of the 100,000-member California State Employees Assn. “He is an excellent choice.”
Despite Burton’s decision to play a less visible role in the shareholder rights arena, CalPERS, by virtue of its sheer size and frequent innovations, is expected to remain one of the leaders in the field. Other public pension funds, such as the Wisconsin Investment Board, have followed CalPERS’ lead to become aggressive advocates of shareholder rights.
“CalPERS has continued to expand (its) program, with a new emphasis on (foreign company) holdings,” said Howard D. Sherman, director of Institutional Shareholder Services, a Washington-based consulting firm that advises clients on corporate governance issues.
