NYC Comptroller Streamlines Pension Board Meetings; Hopes for Higher Returns

New York City Comptroller Scott Stringer, who also serves as custodian and investment adviser on the boards of the city’s five pension funds, brought on some big changes this week in the way the city’s pension boards do business.

Stringer has consolidated the investment committees of the city’s five pension funds to create one big “umbrella” board; instead of each board meeting separately, there is now a mass meeting held four times per year.

Stringer hopes the change will lead to better investment decisions and boost returns.

From Crain’s New York:

Stringer hopes his changes, including the consolidation of meetings among the funds’ five boards, will boost city returns. New, mass trustee meetings will free up time for his chief investment officer, Scott Evans, to closely manage the funds, he said at a breakfast hosted by the Citizens Budget Commission.

With the new structure, “Scott Evans doesn’t spend every waking moment doing the same meeting over and over again,” Stringer said. “That means he can now sit down with our asset managers and … look at good investments, because it’s all about that one-twentieth of a percent. It’s all about hitting that investment at the right time.”

Improving returns by such a small amount would be better than nothing, experts said, but it is the market that ultimately determines whether the funds achieve their target 7% annual return.

“If the S&P is up 3.5% for a few years, we’re not going to make 7%,” former Merrill Lynch risk manager John Breit said. “And we can work on fees, we can work on investment meetings, and it’s not going to make a profound difference.”

Collectively, the city’s five pension systems manage about $160 billion in assets.

Photo by Thomas Hawk via Flickr CC License