The US$173 billion California Public Employees’ Retirement System (CalPERS) is restructuring the relationships it has with its hedge fund managers and calling for fees to be based on long-term rather than short-term performance.
CalPERS said performance fees should be judged on a long-term basis, and mechanisms such as delayed realisations and clawbacks can better align long-term interests of managers and investors.
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The Ontario Municipal Employees Retirement System (OMERS) has created a new investment entity, called OMERS Strategic Investments, with a specific mandate to secure co-investment relationships with like-minded investors from around the world, and facilitate a move to its target of about 42 per cent of investments in private markets.
Investors in the private equity secondaries universe must be selective as more assets, including distressed assets, come to market and valuations seem set to head south.
Federal officials in the US, including Federal Reserve chairman, Ben Bernanke, will receive letters from Congress in the next couple of days requesting documents about their knowledge of performance bonuses paid to Merrill Lynch executives just weeks before federal money was allocated to the bank’s merger with Bank of America.
As many corporate executives draw public criticism for their governance practices, institutional investors should exercise their power to influence who is appointed to the boards of companies they invest in, and who remains on them, the chairman of Australia’s A$59.6 billion Future Fund, David Murray, said.
The distress in the financial markets is offering Australian superannuation funds good opportunities to achieve a higher internal rate of return (IRR) on quality assets purchased directly.
Sam Magee, commercial director at Australian investment manager Industry Funds Management (IFM), told the Conference of Major Superannuation Funds (CMSF) held in Australia this week, that there are now more opportunities to buy quality assets at a better price.