CalSTRS Begins New Diversity Effort in Investment Management

News release

 Sacramento, CA  – The California State Teachers’ Retirement System announces the start of a unique effort to expand the diversity of ideas and people throughout its $129 billion investment portfolio. This comprehensive approach will look at the way investment decisions can integrate diversity to yield good investment returns and simultaneously reflect the new face of California.

“The change in California demographics sets a new standard on how matters of diversity are addressed by well-run organizations. The majority of Californians are members of an ethnic minority and young – we know this because our teachers’ classrooms have been reflecting this for some time,” said Jack Ehnes, chief executive officer of CalSTRS. “The trend of rapidly growing ethnic communities continues, not only in California, but across the U.S. It’s what makes us vibrant and strong. This trend, identified by many and harnessed by few, creates an enormous opportunity that can translate into valuable and attractive products for the investment community. We want to channel California’s vitality, richness and strength for the benefit of our teachers.”

Assisting CalSTRS in this disciplined, inclusive approach to finding new investment opportunities is Altura Capital, a member of the Ramirez group of companies. The consulting firm, based in New York City and headed by Monika Mantilla Garcia, specializes in identifying competitive abilities of undiscovered, underutilized or undercapitalized investment talent, markets, communities and service providers. The firm’s work for CalSTRS will include research and development of a database of emerging financial services providers as well as investment strategy assessment and recommendations for policy changes.

“This effort will expand and capitalize on diversity and demographic trends. We will be looking at diversity in a measured, comprehensive manner – the same way we make investment decisions and select investment partners,” said Christopher J. Ailman, chief investment officer of CalSTRS. “Diversity in the management of investments is another key strategic business component in securing the financial future of California’s educators.”

This initiative to incorporate diversity of people and ideas throughout the investment portfolio is the next step in CalSTRS’ recognition of the opportunities. Currently CalSTRS has more than $2.5 billion managed by nineteen minority firms in its domestic stock portfolio and $35 million in its alternative investment portfolio.

CalSTRS is the third-largest public pension fund in the United States. It provides retirement, disability and survivor benefits to California’s public school teachers from kindergarten through community college, serving more than 755,000 members and their families.