CalPERS Creates Web Site on Internet
The nation’s biggest public pension fund is building a home on the Internet.
In doing so, the $100-billion California Public Employees’ Retirement System, or CalPERS, may pave the way for other public pension funds to use cyberspace to get in touch with their beneficiaries.
CalPERS is following a growing number of pension funds that find the Internet is a good way to get information to their members and the investment community.
Among the state and local pension funds already on the information superhighway are the $5-billion Los Angeles City Employees’ Retirement System, the $3.1-billion Oklahoma Public Employees’ Retirement System and the $1-billion Houston Firemen’s Relief and Retirement Fund.
Most of these sites chiefly serve beneficiaries--active members and retirees--by providing basic information on investments, services and benefits. The $21.7-billion Virginia Retirement System has interactive features that allow beneficiaries to fill out and submit forms for services such as a retirement-planning session.
The primary audience for the Houston Firemen’s fund site is its members. But the fund directors expect investment managers to visit the site when they are applying to manage money for the system. “At a minimum, we’ll be able to tell investment advisors to consult our Web site instead of consulting us,” said the fund’s executive director, Jennifer Morales.
Bill Sullivan, a spokesman at the Virginia system, said the site is a great way for a prospective money manager to do some homework. “If you were somebody who hoped to be a money manager [for the system], you would be crazy not to look it over,” he said.
A few adventurous funds are even using the Internet to conduct necessary, but sometimes tedious functions, such as distributing “requests for proposals” as they search for new investment managers. Typically, in an RFP process, managers contact the pension fund for an application.
About half the candidates for an emerging market position at the Los Angeles City Employees’ Retirement System, for instance, recently downloaded their RFP application from Lacer’s Internet site, according to Dan Gallagher, chief investment officer. Firms with computer software that didn’t match the application format were able to get a copy via e-mail.
CalPERS doesn’t expect to seek investment managers on the Internet just yet, although it is possible, said spokeswoman Pat Macht. The primary objective is to serve CalPERS’ more than 1 million members and the employers that turn to the fund for information to pass on to their employees, Macht said. The site is scheduled to be launched by year’s end.
One of the biggest complaints among CalPERS members is the inability to contact the system and get questions answered, she said. Members can call CalPERS 24 hours a day. But many of these calls could be handled over the Internet, Macht said. The Internet won’t eliminate the calls, but it gives members another venue. “Our goal is not to create one preferred method of communication,” she said.
At the Virginia Retirement System, the site “saves a lot of phone calls,” said Sullivan, the system’s spokesman. “We put as much on the home page as we can.”
He estimates that phone calls have fallen to 2,000 a day from 2,500 a day; meanwhile, while usage of the Internet site increases an average of 70% to 90% a month.
